2015 (12) TMI 1490 - AT - Central Excise

Denial of Concessional rate of duty - Fuel efficient light commercial motor vehicles - Benefit of Notification No. 462/1986-CE - Held that - Appellants are deemed as manufacturers of motor vehicles. This by itself does not make them eligible for the concessional rate of duty under Notification No. 462/1986-CE. The terms of the notification are very clear for the concession therein is available only for Fuel efficient light commercial motor vehicles which satisfy the Fuel efficiency test with the particular type of fuel and authorized pay load, speed and atmospheric condition as tested by the Competent Authority and certified by the officer not below the rank of Joint Secretary to the Government of India in the Ministry of Industry. The appellant is not in the possession of any such certificate. The motor vehicles cleared by them were not subjected to any such test for fuel efficiency. The fuel efficiency certificate, if any, in possession of the supplier of engine/chassis namely Eicher Motors Ltd. cannot by itself be the basis for the appellant to claim such concession. Such interpretation will be against the terms and conditions mentioned in the said notification. We find no infirmity in the order of the lower authority - Decided against assessee.

Summary

Issues:
Eligibility for concessional rate of duty under Notification No. 462/1986-CE for fabrication of bodies for motor vehicles on duty paid chassis.

Analysis:
The appellant was engaged in fabricating bodies for motor vehicles on duty paid chassis and claimed eligibility for the concessional rate of duty under Notification No. 462/1986-CE. The Department issued a show cause notice to deny the concession, leading to adjudication by the Original Authority and subsequent confirmation by the Commissioner (Appeals). The Tribunal remanded the matter to the Commissioner (Appeals) for fresh orders, which were passed denying the concession but setting aside the penalty. The appellant argued that they should be eligible for the exemption as the vehicles they built were certified as fuel-efficient by M/s Eicher Motor Ltd., the chassis supplier. However, the Tribunal noted that the appellant did not possess the required certificate from the Competent Authority as specified in the notification. The appellant's claim that the commercial vehicle comes into existence only after building bodies on the chassis was rejected, as the concession was specifically for fuel-efficient light commercial motor vehicles meeting certain criteria.

The Tribunal observed that for excise purposes, the appellants were considered manufacturers of motor vehicles due to building bodies on the chassis received from M/s Eicher Motors Ltd. Building body on the chassis was deemed as "manufacture" of a motor vehicle under Chapter 87 of the Central Excise Tariff. However, this did not automatically make them eligible for the concessional rate of duty under Notification No. 462/1986-CE. The notification clearly stated that the concession was available only for fuel-efficient light commercial motor vehicles meeting specific fuel efficiency test criteria certified by the Competent Authority. Since the appellant did not possess the required certificate for fuel efficiency testing, the concession could not be extended to them. The Tribunal emphasized that relying on the supplier's fuel efficiency certificate alone was not sufficient to claim the concession, as it did not meet the notification's terms and conditions. Consequently, the Tribunal found no error in the lower authority's decision and dismissed the appeal.