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TMI Blog1999 (9) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... nance and warranty charges realised by the appellants. The Central Excise duty of Rs. 57,74,866/- has also been confirmed and a penalty of Rs. 1 lac imposed on the appellants. 2. Briefly the issue concerns import in SKD condition of Micro Earth Stations which were supplied to M/s. National Informatics Centre (NIC) for erection at various locations specified by them including district headquarters in various States. The order impugned holds that the said erection/installation amounts to manufacture and that in the assessable value thereof, the interest received by the appellants from M/s. ITI Ltd. from time to time is to be included and differential duty leviable. Similarly, the amount of maintenance and warranty charges is to be included ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... installation of a complete system imported in a semi-knocked down condition at site indicated by the buyers cannot be said to constitute manufacture but it is merely a trading activity. 5. Ld. Advocate further submits that the ld. Collector has relied on the judgment in the case of Narne Tulaman Mfrs. (P) Ltd. as reported in 1988 (38) E.L.T. 566 (S.C.). As the same has been reviewed by the Supreme Court in the case of Mittal Engg. as reported in 1996 (88) E.L.T. 622 (S.C.) and also in Quality Steel Tubes (P) Ltd. as in 1995 (75) E.L.T. 17 (S.C.) wherein it was observed that in the case of Narne Tulaman Mfrs. (P) Ltd. the Court had not considered the question of manufacture at all under the Central Excise law. Therefore, the reliance in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st-warranty charges cannot be included in the assessable value. To support these two arguments, ld. Advocate cites the case of British Physical Laboratories India Ltd. as in 1990 (50) E.L.T. 567 wherein it has been held that assembly of video magnetic tapes with plastics imported in disassembled condition especially in the absence of manufacture of any components thereof does not amount to manufacture and in reaching the said conclusion, the Tribunal had relied on a number of other decisions of the Apex Court as well as High Court of Calcutta and Madras indicated therein. He submits that since there is no evidence on record or allegation that any component of this highly sophisticated satellite micro earth station was manufactured by the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f charge is compulsory, subsequent maintenance services are always to be considered as optional. In view of the aforesaid submissions, he submits that there is no merit in the order impugned and prays for the appeal to be allowed. 8. Ld. Advocate further submits that even if it is held that erection would amount to manufacture, though not admitted, the Central Excise Collectorate, Bangalore would not have jurisdiction to raise demand on those systems which were erected/installed outside its geographical jurisdiction. He says 99% of the said equipment was erected outside the jurisdiction of the said Collectorate. On that ground also, the demand upheld in the order impugned suffers from lack of jurisdiction. The list of these locations are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein is for the period thereafter. 12. We have carefully considered the rival submissions and records of the case. We find that the equipment imported was such that the like of which was not manufactured in India by anybodyelse. We also find that therefore the entire equipment necessary was imported albeit in SKD condition. These imports were cleared through Customs after assessment to Customs duty etc. under that law. We also find that appellants have led significant evidence to show that they were not in possession at the material time of any infrastructure, factory, means of production, work force etc. by which they would have manufactured any component to complete the working of the items imported as a complete Micro Earth Station. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection/installation was done at various cites all over the country as is available in the paper book as noted above, we find that the Collector of Central Excise, Bangalore had no jurisdiction to issue a demand in the case of those cites which were beyond the geographical jurisdiction of the said Collectorate as exists by the Govt. notification on this issue. A perusal of these locations, we find that a very substantial part of the demand would straight away be hit by lack of jurisdiction even if it were to be held that such installation amounted to manufacture. However, we have not held so as indicated above. Since no manufacture is involved, there is no question of any other excisable goods emerging and of addition of any charges to their ..... X X X X Extracts X X X X X X X X Extracts X X X X
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