Content Provider | Supreme Court of India |
---|---|
e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | exemption notification Central Excise Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Disposed Off |
Headnote | Central Excise Act, 1944-Exemption Notification-Entitlement of Assessee manufacturing parts of loco wagons and rolling stock at its factory and bringing it to other factory for use in repair and maintenance of transport equipment used within the factory-Benefit of exemption sought-Issuance of show cause notice alleging breach of Notification: Tribunal held that Notification not applicable as the machinery for which parts were meant not installed in the factory but used in factory-Plea that when placed on rail, it can be set to be placed in position, and thus, installed-On appeal, held: For want of some more factual details with regard to installation of machines, matter remanded back for fresh adjudication-Furthermore, the Tribunal failed to consider that the expression 'machinery installed in the factory' not covered in the Headnote of the Notification-As such the Tribunal directed to consider the effect of the absence of the words. Section 11A-Central Excise Rules, 1944-Rules 9(2) and 196(1) and Chapter X-Assessee manufacturing parts of loco wagons and rolling stock at its factory and bringing it to other factory for use in repair and maintenance of transport equipment used within the factory-Benefit of Notification sought- issuance of show cause notice proposing duty and penalty for contravention of procedure under Chapter X of Rules by consignee-other factory on failing to intimate actual use of goods received from consignor under Rules 9(2) and 196(1) and section 11A(1)-Authority holding section 11A(1) applicable whereas Tribunal holding notices within time with reference to Rule 196-On appeal, held : Tribunal .introduced Rule 196 without giving opportunity to assessee-Assuming that assessee entitled to exemption but the Tribunal did not consider whether the consignee could be proceeded against for not following the procedure under Chapter X and violation of the terms and conditions of the License in proper perspective-Hence, matter remanded back for fresh adjudication. Words and Phrases: 'Install' or 'installed ',Meaning of Appellant-assessee manufactured parts of loco wagon and rolling stock at its factory and brought them to the other factory for repair and maintenance of transport equipments used for moving the material and products within the factory. Appellant sought the benefit of the Notification No. 281/86 dated 24.4.1986 exempting the excisable products used for repairs and maintenance of machinery, with regard to the parts of loco-wagon and rolling stock falling under Chapter 86 of the Schedule under Central Excise Tariff Act, 1985 manufactured in its factory and brought to other factory for repair and maintenance of transport equipments used for moving the material and products within the factory. Department issued show cause notices to the appellant's factory alleging breach of the terms and conditions of the Notification. The Tribunal held that locomotive or rolling stock wagon or bogies are moving items and were not so placed or put or fixed in a position as such the benefit of the Notification was not available since it applied to machinery installed in the factory and not to the machinery used in the factory. Hence, the first and second appeal. Appellant had sought permission under Rule 192 of Central Excise Rules for bringing parts of loco engine and rolling stock from its factory to the other factory without payment of duty, claiming the benefit of the notification but the same was refused. Department issued show cause notice to the appellant proposing imposition of duty and penalty for contravention of procedures contained in Chapter X by the other factory-consignee having failed to intimate the actual use of goods received from the appellant's factory-consignor under Rules 9(2) and 196(1) of the Rules read with proviso to section 11(A)(1) of the Central Excise Act, 1944. With regard to the show cause notices to be within limitation period, the Adjudicating Authority and the First Appellate Authority proceeded as if section 11A(1) was applicable whereas CEGAT held that for, raising a demand under Rule 196, limitation under section 11A(1) is not relevant and since no period of limitation is prescribed under Rule 196, notices were issued within time. Hence the third appeal. Appellant-assessee contended that the term 'installation' does not mean that it should be embedded to the earth only, but means setting up or fixed in position for use or service; that the wagon and the trucks which were quite heavy are used in the factory premises on fixed rails and when they are placed on rails they can be said to be placed in position; and that the CEGAT made out a new case relating to applicability of Rule 196 for the purpose of limitation depriving the appellant of presenting its case. Respondent-revenue contended that the revenue authorities as well as CEGAT clearly held that the parts were in fact not used for repair or maintenance of machinery installed; that in the common parlance the word "installed" means embedded to the earth with no possibility of movement from one place to another; and that both Rule 196 and section 11A(1) operate in different field'. |
Judge | Hon'ble Dr. Justice Arijit Pasayat |
Neutral Citation | 2005 INSC 113 |
Petitioner | The Tata Iron And Steel Co. Ltd., Bihar |
Respondent | The Collector Of Central Excise, Patna |
SCR | [2005] 2 S.C.R. 457 |
Judgement Date | 2005-03-02 |
Case Number | 5421 |
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