1984 (9) TMI 288 - AT - Central Excise

Summary

Issues Involved:
1. Classification and assessment of fully assembled windows, doors, shutters, and other like products.
2. Classification and assessment of products cleared in CKD or ready-to-assemble condition.
3. Classification and assessment of processed aluminum sections claimed to be component parts.
4. Maintainability of appeal against provisional assessment.
5. Imposition of penalty for breach of Central Excise Rules.

Summary:

Issue 1: Classification and Assessment of Fully Assembled Products
The Tribunal held that fully assembled windows, doors, shutters, and similar items, when removed from the factory, are classifiable under T.I. 68 and liable to duty. The processes performed on aluminum sections, such as cutting, drilling, and punching, result in the creation of new products with distinct names, characters, and uses, thus constituting "manufacture."

Issue 2: Classification and Assessment of CKD or Ready-to-Assemble Products
The Tribunal decided that products cleared in CKD packs or ready-to-assemble condition, which require only minor operations at the site, are also classifiable under T.I. 68 and liable to duty. These items are considered "goods" as they are identifiable and marketable.

Issue 3: Classification and Assessment of Processed Aluminum Sections
The Tribunal found that merely cutting, drilling, and punching aluminum sections do not constitute "manufacture" as defined by the Supreme Court in Union of India v. DCM and South Bihar Sugar Mills v. Union of India. The processed sections do not acquire a distinct name, character, or use and are not "goods" liable to excise duty. The lower authorities failed to provide clear evidence that these processed sections are identifiable component parts.

Issue 4: Maintainability of Appeal Against Provisional Assessment
The Tribunal allowed the appeal against the order requiring the appellants to file price lists in part-II for every contract. It was held that the appellants could file price lists in part-VI or another appropriate form after discussion with the A.C.C.E., considering practical problems.

Issue 5: Imposition of Penalty
The Tribunal set aside the penalty of Rs. 250 imposed on the appellants for breach of Rule 173Q, finding that the imposition of the penalty was not warranted under the circumstances.

Conclusion:
The appeals were partly allowed. The lower authorities were directed to rework the Central Excise duty chargeable to the appellants in light of the Tribunal's decision and observations.