1984 (5) TMI 240 - AT - Central Excise

Summary

Issues involved:
The appeal challenges the orders of the Collector of Central Excise & Customs, Pune alleging violation of Central Excise Rules by a Government of Maharashtra Undertaking regarding the manufacturing and assembly of bullock carts.

Detailed Judgment:

Issue 1: Manufacturing of Bullock Carts
The Collector alleged that the appellants were manufacturing excisable goods, bullock carts, and demanded duty for a specific period. The appellants contended that they were not manufacturing bullock carts in their factories but were assembling them at customer sites using parts purchased from the market. The Collector imposed penalties and demanded duty without legal authority. The Tribunal found that the show cause notice could not be sustained as there was no evidence to prove manufacturing of bullock carts at the appellants' factory. The Department failed to provide any evidence to support their claim.

Issue 2: Application of Notifications
The Department argued that the clearances of both units should be combined as per specific notifications. They claimed that since invoices mentioned the sale of bullock carts, manufacturing was evident. However, the Tribunal noted that the appellants were not engaged in manufacturing activities as they primarily assembled bought-out items at customer sites. The Tribunal emphasized that the appellants could rely on specific notifications that precluded certain clearances from duty assessment.

Issue 3: Time-Barred Demand
The appellants argued that the demand was time-barred under Section 11A as the show cause notice did not allege suppression and the officials were aware of the assembly process. The Tribunal agreed, stating that the appellants had consistently maintained they were not manufacturers, and there was no evidence of suppression. The appeal was allowed with consequential relief.

In conclusion, the Tribunal ruled in favor of the appellants, finding that the show cause notice lacked merit, the appellants were not engaged in manufacturing bullock carts, and the demand for duty was time-barred.