2015 (2) TMI 86 - AT - Central Excise

Discharge of duty liability on subsequent fixation of glass as also use of metal/rubber products amounts to further manufacture - Held that - Appellant was manufacturing doors, windows and frames of the same at their factory located at Bhiwadi, Rajasthan. The same were being cleared by them on payment of duty, to their head office located at Gurgaon where glass and other rubber/metal fitments were being done at site so as to fix the doors and windows. - fixation of glass in already manufactured doors cannot be held to be emerging of a new product inasmuch as doors remain doors and windows remains windows. There is nothing on record to show that after the fixation of glass on the doors and windows, the same can be removed as such, without breaking, etc., or in the same position in which case it has to be held that they have become immovable property. - no infirmity in the views of the Commissioner (Appeals). Admittedly, the said doors and windows have discharged the appropriate duty at the time of their removal from Bhiwadi factory. After putting glass in the same, they do not acquire a different name or character or different use so as to held that activity undertaken by the assessee at the site has resulted in any manufacturing activity. - Decided against Revenue.

Summary

Issues:
Manufacture of doors, windows, and frames - Liability for further duty on subsequent fixation of glass and metal/rubber products.

Analysis:
The case involved a dispute regarding the liability for further duty on the subsequent fixation of glass and metal/rubber products in doors, windows, and frames manufactured by the appellant at their factory. The Revenue contended that such fixation amounted to further manufacture, necessitating additional duty payment. The proceedings initiated resulted in the confirmation of a duty demand, interest, and penalty against the appellant.

Upon appeal, the appellate authority ruled in favor of the assessee, stating that the fixation of glass in already manufactured doors did not result in the emergence of a new product. The authority highlighted that doors and windows retained their original identity even after the fixation of glass and metal/rubber products. It was noted that there was no evidence to suggest that the glass could be removed without damage, indicating that the doors and windows had become immovable property.

The Tribunal agreed with the appellate authority's decision, finding no fault in the view that the doors and windows maintained their original identity even after the additional fixations. The Tribunal emphasized that the products had already been appropriately taxed upon their initial manufacture and that the subsequent activities did not change their essential nature or purpose to warrant further duty liability.

Ultimately, the Tribunal dismissed the Revenue's appeal, concluding that the activity undertaken by the appellant did not amount to a new manufacturing process that would trigger additional duty obligations. The decision highlighted the importance of the products' essential characteristics and uses in determining the applicability of further duty liabilities in cases of subsequent modifications or fixations.