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TMI Blog2001 (5) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... earned Advocate for both the appellants, submitted that M/s. Vijay Engg. Corporation, a partnership concern consisting of 3 partners came into existence in 1967; that M/s. Vijay Tractors Corpn. is also a partnership concern consisting of 3 partners and it came into existence in 1957; that Vijay Engg. Corporation (V.E.C.) besides dealing in Petroleum products, Batteries and other items, manufacture fuel tank, base frame, and control panels for diesel generating sets; that Vijay Tractors Corpn. (V.T.C.) were buying six components of D.G. sets, namely I.C. Engines, Alternator, Control Panel, Battery, Fuel Tank, Base Frame besides trading in other goods; that they were also assembling D.G. sets themselves. The learned Advocate further submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no power was used by them in the assembly of D.G. set at all; that according to the show cause notice power is absolutely necessary for aligning engine with alternator; that such an allegation is factually and technically incorrect inasmuch as alignment job cannot be carried out if I.C. Engine is allowed to run; that this was explained to the Commissioner that alignment is always done manually; that Prof. B.L. Juneja, Head of Mechanical Engg. Department, IIT had also given his report confirming that alignment was done manually; that the Commissioner has not given any finding on this aspect which goes to show that he has accepted the version of the appellants that no power is used in aligning the I.C. engine with alternator. The learned Adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g various bought out parts manufactured with the aid of power would be eligible for exemption under Notification No. 179/77 as goods manufactured without the aid of power. This clarification was based on the opinion of the Law Ministry according to which exemption from payment of excise duty on a finished product can be availed of even if power has been used in the process of manufacture provided that the raw material/component parts by themselves are excisable irrespective of the premises in which these parts are manufactured. The learned Advocate also said that the ratio of the decision in the case of Dassani Electra Pvt. Ltd. v. C.C.E., Calcutta - 2000 (125) E.L.T. 646 (T) is applicable. It was held in that case that though the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision in the case of C.C.E. v. Remed Saw Mill No. 2 - 1989 (43) E.L.T. 688, wherein it was held that Sawing of timber is a part of the process of manufacture of furniture and since the timber was sawn with the aid of power the furniture was manufactured with the aid of power. He also relied upon the decision of the Supreme Court in the case of Standard Fire Works Industries v. C.C.E., Madurai - 1987 (28) E.L.T. 56 (S.C.) wherein cutting of steel wire and treatment of wire with the aid of power was held to be use of power in the manufacture of fire works. He finally submitted that as held by the Supreme Court in the case of C.C.E. v. East End Paper Industries Ltd. - 1989 (43) E.L.T. 201 (S.C.), manufacture of goods should normally enc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are manufactured. The Law Ministry also gave the reasons as under : - This is because these parts, manufacture of which is complete, are excisable at the time of removal of the goods where they are produced. As pointed out in the referring note, when these goods are further used as raw material/components etc. for further manufacture of other goods, fresh process of manufacture commences. 7. After the pronoucement of the judgment of the Supreme Court in the case of Standard Fire Works (supra), the Board re-examined the clarification issued under Circular dated 15-11-85 and the Board under Circular No. 4/87, dated 19-6-87 opined that no modification is necessary in regard to the guidelines given in Circular No. 11/85, dated 19-11-85 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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