2017 (3) TMI 646 - AT - Central Excise

Exemption from duty - building a body or fabrication or mounting or fitting of structure or equipment on a chassis - denial on the premise that the car carrier trailer manufactured by the appellant is not mounted on the duty paid chassis - Benefit of N/N. 6/2002-CE (Sl. No. 239) as amended by N/N. 6/2006-CE (Sl. No. 87) - Held that - different types of bodies are built for transport of goods depending on the nature of goods to be transported. Some lorrys have open platform for transport of steel rods sheets etc. Others will have closed box type body for transport of cement etc. Yet another type like tank is for gases and liquids - In the present case the transportation is for cars to be carried by these trailers. Accordingly the design and integration is specific. We do not see that to claim the exemption under the notification the body built should be inseperably attached to the said chassis. No such meaning can be attributed to the notification entry. The mounting or fitting mentioned in the notification thus covers the scope of the activity carried out by the appellant in the manufacture of car trailers and their integration with the prime movers (duty paid chassis) - benefit extended - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Claim for exemption under Notification No. 6/2002-CE (Sl. No. 239) as amended by Notification No. 6/2006-CE (Sl. No. 87).
2. Classification of car carrier trailers under tariff heading 8716.
3. Eligibility for exemption under Notification No. 6/2002-CE, Sl. No. 212.
4. Applicability of case laws on classification of tankers trailers.

Analysis:

1. The main issue in this case revolves around the appellant's claim for exemption under Notification No. 6/2002-CE (Sl. No. 239) as amended by Notification No. 6/2006-CE (Sl. No. 87). The dispute arises from whether the car carrier trailer manufactured by the appellant is mounted on a duty-paid chassis, a condition for availing the exemption. The Revenue contended that the trailer was not mounted on the duty-paid chassis, leading to the denial of the exemption and imposition of duty demand.

2. The classification of the car carrier trailers under tariff heading 8716 is crucial in determining the eligibility for the exemption. The appellant argued that the chassis to which the carrier was attached was duty paid, satisfying the conditions of the notification. The Tribunal observed that the weight of the trailer is borne by the prime mover chassis, and the coupling is designed for weight distribution and maneuverability, supporting the appellant's claim for exemption.

3. Regarding the eligibility for exemption under Notification No. 6/2002-CE, Sl. No. 212, the Tribunal noted that the fully manufactured motor vehicle, comprising the duty-paid chassis with the car carrier trailer attached, falls under the exemption. The original authority's reliance on a previous Tribunal decision regarding the classification of tow-away trailers was deemed inapplicable to the present case.

4. The applicability of case laws on the classification of tankers trailers was also discussed. The Tribunal analyzed previous decisions concerning tankers/LPG tanks and plough lamps for exemption but concluded that these cases were not directly relevant to the dispute at hand. The interpretation of "mounting" in the context of the appellant's activities was crucial in determining the applicability of the exemption under the notification.

In conclusion, the Tribunal found merit in the appellant's appeal, holding the impugned order as unsustainable and setting it aside. The appeals were allowed, emphasizing the specific nature of the integration of the car carrier trailers with the prime movers and the fulfillment of conditions for exemption under the relevant notifications.