2007 (12) TMI 327 - AT - Central Excise

Summary

Issues:
Challenge against dropping of demand of duty on 'induction furnace' installed, erected, and commissioned in a factory. Whether the respondents can be considered as 'manufacturers' of the furnace due to their involvement in the erection and commissioning process.

Analysis:
In this appeal, the Revenue challenges the dropping of duty demand on an 'induction furnace' installed at a factory. The furnace was supplied in CKD/SKD condition by M/s. ABB and assembled, erected, and commissioned by M/s. ABB engineers at the factory premises of M/s. RVS. The Revenue argues that the respondents should be considered 'manufacturers' due to their employment of supervisory personnel and laborers during the process. However, the Commissioner (Appeals) found that property in the furnace transferred to M/s. RVS only upon erection and commissioning by M/s. ABB engineers. The Revenue claims that M/s. ABB were mere hired laborers and that the complete furnace was manufactured by the respondents. The learned SDR reiterated these statements while the Counsel defended the impugned order.

It is noted that in a similar case involving M/s. ABB and M/s. BIL, the proceedings against M/s. BIL were dropped by the adjudicating authority. The Tribunal found that M/s. BIL were in a similar position as the present respondents regarding the furnace's erection and installation supplied by M/s. ABB in CKD/SKD condition. The appellate Commissioner acknowledged this fact in the impugned order.

After considering the submissions, the Tribunal found no reason to interfere with the decision of the Commissioner (Appeals). It was established that M/s. ABB supplied the furnace in CKD/SKD condition and their engineers undertook the erection and commissioning services. The Tribunal deemed the argument of treating the respondents as manufacturers due to providing labor for civil works as flimsy and unsupported by valid reasons. The Order-in-Original accepted by the department in a similar case serves as a precedent, leading to the dismissal of the Revenue's appeal.

In conclusion, the appeal failed, and the Tribunal dismissed the same after thorough consideration of the facts and legal arguments presented during the proceedings.