2003 (3) TMI 188 - AT - Central Excise

Summary

Issues Involved:
1. Whether the appellants or the contractors are the manufacturers of the goods.
2. Whether the goods, viz. ladders and staircases, are dutiable and whether they are considered "goods" or "immovable property."

Issue-wise Detailed Analysis:

1. Manufacturer Determination:
The appellants, Tata Iron & Steel Company (TISCO), engaged several contractors for the structural work, including fabrication and erection at site. The contractors were:
- Tata Construction & Project Services Ltd.
- Larsen & Toubro Ltd.
- VS Enterprises
- Globe Hi-fabs Ltd.
- Triveni Structurals Ltd.

The work orders specified quantities, unit rates, and amounts, and the contractors undertook the fabrication work on a principal-to-principal basis. The contracts included the use of the contractors' tools, tackles, and equipment, and the contractors were responsible for liabilities such as Provident Fund and insurance. The Tribunal referenced several case laws, including India Cements Ltd. v. Additional Commissioner and Voltas Ltd. v. CCE, Guntur, which established that a material supplier is not a manufacturer when the relationship is principal-to-principal. Thus, the Tribunal concluded that the contractors, not TISCO, were the manufacturers.

2. Excisability and Nature of Goods:
The goods in question, ladders and staircases, were fabricated by the contractors and used as part of the building structures in TISCO's mills. These goods were tailor-made and used captively, without availing Modvat Credit. The Tribunal noted that the goods were permanently affixed to the building structures, making them immovable property. The Commissioner's reliance on dictionary definitions to argue that the goods were not part of building structures was rejected. The Tribunal emphasized that staircases and ladders are integral parts of buildings and thus become immovable property when permanently affixed.

The Tribunal referred to Notification No. 61/90-C.E., which exempts goods fabricated at the site of construction for use in such construction work. The goods in question were fabricated at the site and used as part of the structures, falling under Heading No. 73.08, which covers structures and parts of structures. The Tribunal cited several judgments, including UOI v. Sonic Electrochem (P) Ltd. and CCE, Nagpur v. Wainganga Sahkari S. Karkhana Ltd., to support the view that the goods were not marketable and thus not excisable.

Conclusion:
The Tribunal concluded that the goods, being part of the building structures and immovable property, were not excisable. The impugned order was set aside, and the appeal was allowed.