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TMI Blog1984 (11) TMI 339X X X X Extracts X X X X X X X X Extracts X X X X ..... espondents-M/s. General Engineering Workshop-had a job contract with M/s. Visakhapatnam Steel Project, for subjecting certain raw materials supplied by M/s. Visakhapatnam Steel Project to processes, so as to facilitate erection of sheds (conveyor belt stores). The Department on a scrutiny of the records of respondents were of the view that respondents had fabricated steel structures (referred to as trusses, rooflegs, crane girders, etc.) and removed them without payment of excise duty, as such structures were liable to be classified under T.I. 68. In the course of the investigation respondents explained that the process of fabrication was undertaken by them at the project site of M/s. Visakhapatnam Steel Project and not in their factory and that these were fabricated out of raw materials supplied. In the course of the original proceedings before the Deputy Collector of Central Excise, Visakhapatnam, respondents had pleaded that they had not manufactured goods, so as to attract duty liability under under T.I 68 and relied on the judgment of the Supreme Court in the case of Delhi Cloth and General Mills Company Limited ; decision of the Government of India in the case of M/s. Otis El ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aken into consideration the Board s order relied upon by the Deputy Collector. Collector also felt that the fabricated items like beams, trusses, bracings are known or the public, whether there is a general market for them or not and as they were tailor made to meet the requirements of customers, they should be treated as goods. The fabricated items were components of the entire structure and were transported and therefore, they were movable goods and they ceased to be movable only after erection. Collector also recorded that he had visited the factory and personally inspected the work of fabrication and the site of erection and that he was satisfied that the components fabricated and removed, merited to be called as goods falling under T.I. 68. Applicant in his application submitted that this Authority should decide the point viz., whether fabricated steel structurals should be classified under T.I. 68 of Central Excise Tariff. 4. In the course of the hearing at Visakhapatnam on 16-10-1984 respondents were represented by their Advocates Mr. G. Prabhakar Sastry and Mr. N. Mukherjee and consultant Mr. S.P. Kampani. Later consultant submitted written notes summarising the argume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the department has not discharged the burden of proving that the semi-finished components were goods. He referred to be definition of manufacture in the case of DCM and South Bihar Sugar Mills and other decisions of the High Courts and Government of India and of Tribunal, and canvassed the view that manufacture should bring into existence a new substance, involving transformation of the raw materials, and a new and different article having a distinct name, character and use, which should emerge; this article should also be known to the market, where it can be bought or sold. He submitted that structurals are not goods, which are brought to the market to be bought and sold. He also referred to an order passed by the Collector of Central Excise, Hyderabad (adjn). Order No. 57/83 dated 20-8-1983), wherein the Collector had held that structurals which form part of immovable property and could not be identified as goods, are not liable to duty. Consultant did not press another ground canvassed in the memorandum of objections vis., that as respondents had done the process of cutting, drilling, welding, etc., at the site of M/s. Visakhapatnam Steel Project the goods would enjoy the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out that this decision would not be relevant, as the decision related to structurals Which were manufactured according to intricate and involved design and these structurals were also being sold by the appellants. In the present case, the process of cutting, drilling, soldering or welding is a simple process, which does not involve intricate design and the Board s order would be more appropriate. If at all the decision of the Tribunal is to be relied, the decision of the Tribunal in the case of M/s. J.K. Export Industries, Junagadh - 1983 E.L.T. 2390-should be relied upon. 9. I am of the view that these decisions of the Tribunal or the Board were made with reference to the facts, which were placed before them. These decisions do not enunciate or hand down a general proposition of universal application, covering all structurals. It is necessary that each case is examined individually and a decision whether manufacture has taken place, is made with reference to the facts and in the light of the general principle laid down by the Supreme Court in DCM and South Bihar Sugar Mills cases. It is an accepted proposition in Central Excise Law that taxable event is manufacture and not mark ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and angles is the same process, whether done according to specifications or not. Therefore, I am of the view that the process of cutting or drilling would not amount to a process of manufacture, simply because it is done according to specific design. 11. The next argument to be examined is whether as a result of cutting, welding or rivetting the raw material, it acquired a distinct name character or use. In this connection, the department refers to the terms used by the respondents viz.. trusses, beams, bracings, girders etc. It is also submitted that these items are/had been known as structurals in the trade. I find no evidence is introduced by the department that cut and drilled plates, columns and angles are known as structurals, among persons who buy and sell these goods. The word structurals is derived from the word structure , which in Civil Engineering refers to a building, a bridge or something else i.e. built, or constructed and designed to sustain a load (definition as per McGraw Hill Dictionary of Scientific and Technical terms). I am of the view that the department has not established that these are goods known as structurals and such structurals are identifiabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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