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1988 (2) TMI 385 - AT - Central Excise
Issues involved: Determination of liability for excise duty on PSC/PCC and RCC poles manufactured by contractors on behalf of the Kerala State Electricity Board.
Summary: The Appellate Tribunal CEGAT, New Delhi, addressed the issue of excise duty liability on poles manufactured by contractors for the Kerala State Electricity Board. The Collector of Central Excise, Cochin had held the Board liable for excise duty, rejecting their contention that the contractors were the actual manufacturers. The Board appealed against this decision. The Tribunal considered various arguments presented by both parties. One contention raised was the alleged violation of principles of natural justice during the proceedings before the Collector. However, the appellant decided not to pursue this argument further to avoid a possible remand. Another key contention was whether the poles in question were excisable goods. The Collector had ruled that they were, citing a previous decision involving the Andhra Pradesh Electricity Board. The Tribunal upheld this view, confirming that the poles were indeed excisable commodities. The main argument put forth by the appellant was that the contractors, not the Board, were the actual manufacturers of the poles. The appellant relied on contractual terms and agreements to support this claim. The Collector, however, maintained that the Board was the manufacturer based on the supervision and supply of materials involved in the manufacturing process. After examining the agreements between the Board and the contractors, the Tribunal concluded that the contractors operated as independent entities and were the actual manufacturers of the poles. Citing previous cases with similar circumstances, the Tribunal held that the demand for excise duty from the Board was unjustified. Given this finding, the Tribunal did not delve into the question of limitation raised by the appellant. Consequently, the appeal was allowed, and the Collector's order was set aside with any necessary consequential relief.
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