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TMI Blog1994 (1) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... pted power supply (UPS) system, and parts thereof, falling under Sub-Heading No. 8543.00 of the Schedule to the Central Excise Tariff Act, 1985 (the `Tariff ). It was alleged in the show cause notice dt. 21-1-1991, that stationary storage battery, an integral part of the UPS system, was invoiced separately, and its value was not included in the price of the UPS system for the purposes of determining the assessable value, during the period 28-8-1986 to 31-3-1989. The Central Excise duty evaded was worked out at Rs. 5,88,724.85. The appellants pleaded that the battery is not manufactured by them and that the UPS system could work without a battery. On adjudication the Collector of Central Excise, Cochin held that the battery was an integral p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not includible in the assessable value of the meter, cleared in incomplete form. 4.2 The learned Advocate also filed written submissions. 5.1 Shri Prabhat Kumar, the learned SDR submitted that in the UPS system the battery is the source of power when the power is interrupted, and is an essential part of the system, and that the UPS system was not complete without the battery. The question of non-manufacturing of batteries was not relevant for assessing the UPS system. The learned SDR pleaded that the matter was entirely covered by the Supreme Court decision in the case of Narne Tulaman -1988 (38) E.L.T. 566 (SC). 5.2 In support of his arguments the learned SDR also relied upon the following decisions: (1) Rallis India Ltd. v. CCE, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion in the case of IGE India Ltd. v. CCE, 1991 (53) E.L.T. 461 (Trib.), wherein it has been held that assembly of bought out items at customer s site amounts to manufacture. 6. In rejoinder the learned Advocate stated that all relevant documents had been produced before the Collector, and that the UPS system was not a system and calling it as such, will not make it a system. 7. We have carefully gone through the facts and circumstances of the case, and have given our due thought and consideration to the submissions made by both the sides. 8. The appellants were engaged in the manufacture of UPS system. As alleged at page 2 of annexure A of the show cause notice, chloride stationary batteries for UPS system were supplied and cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... break the flow of production, leading to wastages and clotting of in-process material. There are also certain industries - say computer net work wherein the data may be lost in case of interruption of power supply. Sensitive electronic equipment may be damaged by power fluctuations. To meet such conditions, the UPS system is installed. Depending upon the stand-by time required, the battery of particular capacity is used. 11. UPS system could be off-line or on-line, but in both battery is an integral and an indispensable part. It provides uninterrupted character to the system. Off-line UPS system is in the nature of stand-by equipment, while in on-line system, even when the main line is on, the current passes through the system. In bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the power line. Batteries are always kept fully charged and during a power loss, no switching is needed, and thus no interruption takes place. 13. According to the Standard hand-book for electrical engineers - 11th edition by Fink and Beaty (McGraw Hill Book Co. page 28-5,) in the UPS system a battery supplies power to the inverter when the AC power-source is interrupted upto several minutes. Battery typically uses lead calcium cells and usually are selected to provide full load power for 10 minutes. 14. The adjudicating Collector of Central Excise has observed as under: UPS stands for uninterrupted power supply system and as the very name indicates, without the battery being linked with the UPS system, the system will fail to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the Hon ble Supreme Court that the value of the excise duty paid on the electric motor is not deductible while arriving at the assessable value under Section 4(a) of the Act , are relevant. When even the excise duty paid on the components was includible in the value of the article concerned, where could be the question of exclusion of the value of such component for the purposes of assessing the article of which it was a component. 18. In the case of Narne Tulaman Manufacturers Pvt. Ltd. v. CCE, 1988 (38) E.L.T. 566 (SC) the weigh-bridges consisted of three different parts namely, (1) Platform, (2) Load cells, and (3) Indicating system. The appellant in this case only made the indicator system. He got manufactured the platform f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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