1984 (7) TMI 387 - AT - Central Excise

Summary

Issues:
1. Whether certain items manufactured/fabricated in the factory are liable to payment of excise duty.
2. Whether components manufactured in premises not considered as a 'factory' under the Factories Act, 1948, are exempt from excise duty.
3. Whether certain infrastructure facilities like storage tanks should be considered as complete machinery and subjected to excise duty.

Analysis:
1. The appeal involved a dispute regarding the liability of certain items to excise duty. The Collector held that items like Steel structure, spray pond, boiler chimney, etc., were not considered as "machinery" and valued at a specific amount, while the rest were treated as complete machinery and subjected to excise duty under Notification No. 118/75-C.E. The appellants contested this, arguing that certain components should be exempted from duty as they were manufactured in premises not qualifying as a 'factory' under the Factories Act, 1948. The Tribunal examined the records and concluded that the items valued at &8377; 12,36,054 were liable to excise duty under Item 68 CET, setting aside the Collector's order partially.

2. The second issue revolved around components valued at &8377; 10,39,407, manufactured in premises not meeting the definition of a 'factory' under the Factories Act, 1948. The appellants contended that these items should be exempted from duty. The Tribunal emphasized the need for the Collector to investigate whether the concerns fabricating these goods were 'factory' under the Act. It was highlighted that evidence supporting the claim that these items were not manufactured in a 'factory' needed to be presented. The Tribunal acknowledged this aspect and directed further examination by the Collector.

3. Lastly, the question arose regarding infrastructure facilities like storage tanks, steam trap tanks, pipe fittings, etc., valued at &8377; 19,88,940. The appellants argued that these should not be considered as complete machinery and, therefore, exempt from excise duty under Notification No. 118/75. The Tribunal agreed with this argument, stating that these items did not qualify as complete machinery and were eligible for exemption. The Tribunal ordered that no excise duty was leviable on these items and set aside the Collector's decision in this regard.

In conclusion, the Tribunal partially allowed the appeal, confirming the liability of certain items to excise duty while exempting others based on the specific circumstances and legal provisions applicable to each category of goods involved in the case.