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TMI Blog1989 (9) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... jected their application, on the ground that they are dealing with only job work and their activities amount to a specialised support service and not manufacturing activities and hence does not fall within the scope of Industrial Plant as figuring in Tariff Heading 84.66 of the Customs Tariff. The Collector (Appeals) has upheld the Order of the Assistant Collector, on the ground that the appellants do not employ any process necessary for manufacture, production of a commodity. 4. Shri K. Srinivasan, appearing on behalf of the appellants drew attention to the contract and the licence. The contract was found to be a Proforma Invoice . All the same Shri Srinivasan said that it contained terms and conditions and the import was for the substantial expansion of their industry. The Ld. Consultant made reference to the Heading 84.66 of the tariff and stated, reference to industrial plant, does not specify an industrial plant producing a product. He referred to various instances where industrial plants which do not produce any commodity are still recognised as industrial plants. Viz. Milk bottling units for bottling milk only and LPG gas bottling units, and several other projects like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment. The Collector (Appeals) has also referred to this in his Order. The main activity undertaken by the appellant is that of heat treatment of other components - fabricated components like pressure vessel, heat exchangers, boilers, machinery components, cast iron castings etc. The said heat treatment process helps to get the required physical, chemical and metallurgical properties like Tensile Strength, Yield Strength, hardness, Ductility, Fatigue strength, Artificial seasoning, Chemical resistance, etc. This would mean that the appellants do not manufacture a new article as per the definition of the Supreme Court in the D.C.M. case i.e. a new and different article does not emerge having a distinct name, character or use, even after treatment given by the appellant retain its name, character even after the process is over. Therefore, the Ld. JDR held that there was no manufacture involved. With reference to the various examples cited as being industrial plants viz. Port Mechanical Ore Handling etc. Shri Durgayya pointed that they were specifically covered by Notification No. 269-Cus., dated 2-8-1976. The appellants activity has not been specified as an industrial activi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Project, Import Regulations. The regulations envisage either for initial setting up or for substantial expansion of an existing plant. Sub-rule (b) has to specify the description of the articles to be manufactured, produced, mined or explored. The appellants maintain that their activity is a manufacture while the revenue holds that there is no manufacture with a new product emerging but only a process, or activity of job work. The process of heat treatment will not be a manufacturing activity. The findings of the Collector (Appeals) Supra is in reference. He states that the heat treatment process helps to get the required physical, chemical and metallurgical properties like tensile strength, yield strength, chemical resistance etc., there is no dispute about this process and has also been referred to by the Ld. Consultant from the book on Heat Treatment guide. The dispute is whether this will be sufficient to claim that a manufacture or production is involved. The Collector (Appeals) has cited the Supreme Court s decision in U.O.I. v. Delhi Cloth Silk Mills Co. Ltd. wherein it has been observed that manufacture requires a change but every change is not a manufacture and yet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of there being a contract has been refuted by the Departments Representative, the Ld. JDR. 7. Regarding the issue of the appellant that theirs is an Industrial Plant on the plea that their unit was registered under the Factories Act and possession of a Central Excise licence will render them eligible to be called an Industrial Plant in terms of the Heading 84.66, as relied upon in the case of Sujatha International v. Collector of Customs, is not tenable. The scope of the term Industrial Plant has been analysed threadbare in 1984 (17) E.L.T. 443 (Tribunal) - Photovisual Calcutta v. Collector of Customs, Calcutta. It would be worthwhile to reproduce para 5 as hereunder. After careful discussion of the materials placed, we are of the view that the contentions of the appellants cannot be accepted. Tariff Item 84.66 specifically refers to all items of auxiliary equipment as well as components required for the initial setting up of a unit or the substantial expansion of an existing unit of a specified industrial plant" (the other words are omitted as they are unnecessary). Shri Chandrasekharan stated that the machinery in question has been imported for the purpose of substantial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, but also the one which requires substantial expansion should be an industrial plant. The activity in the Industrial Plant envisages the manufacture and production of goods and not mere heat treatment of articles. The industrial activities envisage approval of projects for the import of items for such project undertaking, the concessional rate of duty is applicable. Therefore in the setup of industrial plants, a major production activity is involved and the appellants case will not fit into this scheme of things envisaged in the project import registration and hence the case of the appellant is not acceptable for extending the concession under Heading 84.66. 8. As for the other evidences in support of their claim, viz. the Order of the Commissioner of Income-tax (Appeals) to indicate that theirs was a manufacturing activity and the letter of the Joint Director of Industries to the Joint Chief Controller of Imports and Exports recommending that endorsement of Project Import has been made on the licence, it has to be pointed that the concerned authorities to allow a project import concessions are the Customs Authorities as per the Project Import (Registration of Contract) Regul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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