2008 (4) TMI 102 - SC - Central Excise

If Ready Mix Concrete (RMC) is produced at site, then alone the assessee is entitled to exemption under the requisite Notification - Tribunal s statement in its order that there was no dispute between the parties that RMC was manufactured at site, is baseless - Commissioner has held that RMC has been manufactured at Pen and Padghe and thereafter moved to the construction site impugned tribunal s findings are factually incorrect, so it is not sustainable matter is remanded

Summary

Issues:
1. Claim of exemption for Ready Mix Concrete (RMC) manufacturing.
2. Interpretation of the term 'site' for RMC production.
3. Dispute regarding the manufacturing location of RMC.
4. Tribunal's decision on RMC production location.
5. Remittal of the case for further consideration.

Detailed Analysis:
1. The respondent-assessee claimed exemption for Ready Mix Concrete (RMC) manufacturing, alleging it was done on-site. However, a show cause notice was issued by the Department for alleged suppression from July 1993 to March 1998. The Supreme Court clarified that Section 11A of the Central Excise Act could not be invoked for the entire period based on a previous judgment. The Court restricted the show cause notice to the period from 10th February 1998 to March 1998 for the case at hand.

2. The definition of 'site' for RMC production was crucial for determining the exemption eligibility. The Notification did not define the term 'site,' although it was later defined in a Circular. The Court highlighted the technological advancements, acknowledging the existence of mobile batching plants. The determination of whether RMC was produced on-site depended on the specific facts of each case. The Commissioner found that RMC was manufactured at specific locations and cleared to construction sites without payment of central excise duty.

3. The Tribunal's order stated that there was no dispute regarding RMC being manufactured on-site. However, the Commissioner's order indicated otherwise, specifying the manufacturing locations of Pen and Padghe. The discrepancy raised questions about the actual location of RMC production, leading to the conclusion that there was indeed a dispute regarding the manufacturing site.

4. In light of the discrepancies, the Supreme Court set aside the Tribunal's order and remitted the case for further consideration. The Court directed the Tribunal to analyze the differences in the batching plant's existence, location, mobility, and the site area. The Court emphasized that it was not expressing any opinion on the case's merits and remitted the matter solely based on the Tribunal's statement that the production location was undisputed.

5. Ultimately, the Appeals were allowed, with no order as to costs, indicating a favorable outcome for the appellant. The case was sent back to the Tribunal for a fresh consideration in line with the law, keeping the arguments open for both parties and allowing the submission of additional documents for a comprehensive review.