1990 (1) TMI 190 - AT - Central Excise

Summary

Issues:
1. Classification of steel structures under sub-heading 7308.90 for excisability.
2. Whether the steel structures are considered goods and subject to duty.
3. Determination of the manufacturing process and the liability of the applicant as a manufacturer.

Analysis:
1. The main issue in this case is the classification of steel structures under sub-heading 7308.90 for excisability. The applicant argues that these structures are not goods as they only come into existence when incorporated into a factory's structure. The adjudicating authority classified them under sub-heading 7308.90, but the applicant contends that previous judgments have held such structures not liable to duty. The applicant supplied raw materials to another company for fabrication and erection, asserting they are not the actual manufacturers.

2. The Tribunal referred to previous judgments, including Aruna Industries and Steel Authority of India cases, which held that steel structures are not considered goods for excisability. The Tribunal emphasized that the process of erecting or constructing on-site does not amount to manufacturing goods, even if it involves fabrication. It likened the process to constructing a house, stating that the end result is immovable property, not goods. The Tribunal concluded that no manufacturing process occurred in this case, and no goods were manufactured, leading to the dismissal of the duty demand.

3. The issue of whether the applicant is considered a manufacturer was also addressed. The Department argued that the hired laborers who fabricated the structures are excluded from the definition of a manufacturer under the Central Excise Act. However, the Tribunal disagreed, stating that the process involved in this case was construction and erection, not manufacturing. The Tribunal distinguished the facts from previous cases and emphasized that the key factor is whether a particular process constitutes manufacturing, which must be determined based on the specific circumstances of each case.

4. The Tribunal upheld the appeal, setting aside the impugned order and rejecting the duty demand. It relied on previous judgments and the distinction between manufacturing and construction processes. The Tribunal emphasized that the mere fabrication of structures on-site does not amount to manufacturing goods, especially when the end result is immovable property. Following the reasoning in previous cases, the Tribunal concluded that no manufacturing process occurred in this case, leading to the dismissal of the duty imposition.