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TMI Blog2024 (5) TMI 1047X X X X Extracts X X X X X X X X Extracts X X X X ..... on the Appellant and the Director - Cum-tax value Cenvat credit is admissible if the process of assembly of furnitures is held to be excisable or not. Excisability - HELD THAT:- On the facts whether the workstations installed at the site of the customers become immovable, hence not excisable, the Ld. Commissioner analysing the statements furnished by the Manager and the Supervisor of the appellant and the cross examination of the said witnesses and other evidence has categorically held that with minor damages and scratches, the workstations installed in the premises of the customer from the imported and indigenously procured parts and components could easily be shifted to other premises, hence, these furniture(work stations) are movable and accordingly excisable - the statements/depositions given by the witnesses before the Department have not been retracted, hence are reliable evidences. The witnesses also cross examined before the adjudicating authority. No contrary evidence has been placed by the Appellant to support their argument that after assembling and then fixing the workstations to the ground / floor at the customers premises, it becomes immovable; hence not excisable. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it - CENVAT Credit - HELD THAT:- In the event, the appellant had issued proper invoices indicating sale price of the goods and genuineness of which has not been disputed, the appellants are eligible for the benefit of cum-duty price in view of the amendment to Section 4 of the Central Excise Act, 1944 w.e.f. 14.05.2003 - Also, the appellants are entitled to avail cenvat credit on the inputs on production of evidences of payment of duty on the said inputs to the satisfaction of the adjudicating authority. The impugned orders are modified and the cases are remanded to the adjudicating authority to compute the demands with interest for the normal period of limitation only; also the benefit of cum-duty price and cenvat credit be allowed subject to production of necessary documents. As observed above, no penalty is imposable. Appeal disposed off. - DR. D.M. MISRA, MEMBER (JUDICIAL) AND MRS. R BHAGYA DEVI, MEMBER (TECHNICAL) Mr. Raghavendra B. Hanjeer, Advocate, for the Appellants Mr. Rajiv Kumar Agrawal, Commissioner(AR) and Mr. K. Vishwanatha, Superintendent (AR) for the Respondents ORDER These appeals are filed against Orders-in-Original dt. 31/03/2010; and Orders-in-Appeal dt. 28/0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .V. Surajan, Director by the Commissioner was imposed under Rule 26 of Cenvat Credit Rules, 2002. Thereafter, show cause Notices were issued periodically for the period from January 2009 to June 2012 within normal period of limitation which were adjudicated and demands confirmed with interest and penalty, and in few cases personal penalty was imposed on the Director. Aggrieved by the respective adjudication Orders, the Appellant filed Appeals before the Commissioner(Appeals). The Ld. Commissioner (Appeals) upheld the Orders and rejected the Appeals. Hence, the present Appeals. 3.1. At the outset, the learned advocate for the appellant has submitted that the appellant has not undertaken any activity which amounts to manufacture except assembly of furniture at the site of the customer, imported as well as procured locally on payment of appropriate customs/excise duty by declaring its classification under CTH 9403. They imported the furniture in completely knocked down (CKD for short) condition and same are cleared on payment of appropriate customs duty and CVD as payable under CTH 9403 of Customs Tariff Act. Also, they procured certain goods locally on payment of excise duty classify ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iv. Craft Interiors (P) Ltd. Vs. CCE, Bangalore another [(2006) 12 SCC 250] 3.3. Further, they have submitted that a workstation installed at the site of the customer is imported in CKD condition and the same has been assembled at the site without undertaking any activity which amounts to manufacture. It is for this reason, demand of excise duty on workstation is unjust and legally unsustainable. In support, he referred to the judgment of Hon ble Supreme Court in the case of Maestro Motors Ltd. [2004(174) ELT 289 (SC)]. Further it is submitted that the goods imported were in fully manufactured condition and what was required is only a screw driver technology to assemble the goods at the site and the goods which also came into existence in fully manufactured condition at the time of importation itself and the screw driver technology to assemble the goods cannot be considered as an activity of manufacture. 3.4. Further they have submitted that the learned Commissioner has failed to consider Rule 2(a) of Interpretative Rules under both the Tariff Acts which reads: any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n at various premises of the customers revealed that the workstations which are assembled at the site of the customers by assembling the parts and components imported in CKD condition are fixed to the earth by nuts and bolts to make it is stable, which could be removed easily as and when necessary; therefore, the claim of the appellant that these are fixed to earth on assembling at the site does not hold good. The learned AR for the Revenue relied upon the judgment of the Tribunal in the case of Leo Circuit Boards Pvt. Ltd. Vs. CCE, Belapur [2015(330) ELT 227 (Tri. Mumbai)], CCE, Visakhapatnam Vs. Mehta Co. [2011(264) ELT 481 (SC)], Craft Interiors Pvt. Ltd. Vs. CCE, Bangalore [2006(203) ELT 529 (SC)] and Majectic Auto Ltd. Vs. CCE, Meerut [2001(130) ELT 551 (Tri. Del.)]. 4.2. He has further submitted that the appellants have not taken registration nor intimated Department about the activity of manufacture by assembling the imported parts and components of the furniture along with indigenous materials; hence the learned Commissioner in the impugned order has rightly confirmed demand for extended period of limitation and imposed penalty accordingly. Further he has submitted that sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idered is whether the activity of assembling done by the assessee amounts to manufacture with in the ambit of definition of Section 2(f) of the Central Excise Act, 1944. 57.2. In this regard it is brought out by the investigation that the inputs procured by the assessee are partition panels, frames, tiles with fabric upholstery, aluminium powder coated caps, trims, plastic bushes, Metal Connectors, table tops brackets, wooden panel legs, mobile pedestals that had gone into production of Modular Work Stations. Arm rests left and right, seat, legs, fabric in lengths for chairs and similar materials required for tables, storage cabinets, filing racks. The assessee assemble these inputs in their godown at Adugodi to get different items such as Modular Work Stations Tables Chairs Storage Cabinets and Filing racks are commercially know in the market as Furniture and are classifiable under Chapter heading 9403. It is also observed that the fabric being vital component, the process of manufacture of chairs is incomplete without it, and cannot be sold as such. This process of fixing, stitching, pasting of fabric is carried out in their godown at Adugodi. That are termed in Central Excise Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ves such directions, he admitted that; as and when he gets specific direction, regarding the above Issue they have to remove the screws/bolts and nuts and assemble it in another site and even a layman can do it without any damage to the workstations. Further, Sri K.P. Madhusoodanan, Assistant Manager, (Operations) of M/s R.O.F E P Ltd., Bangalore in his statement dated 06.11.2007 has admitted that regarding shifting, firstly dismantling of the work top Is done and then frames are removed by unscrewing and later reinstalled in the other place without any damage to the materials that are assembled; that regarding demo being organized on behalf of their company, their sales persons gives requisition for a demonstration of work station, the same is conveyed to the godown who in turn dispatches the demo Items to the clients place. Once the demo is over, the materials are dismantled and sent back to the godown; that demonstration or the process of installation at site can be arranged if required at Bangalore. In his statement dated 02.01.2008, Sri K.P.Madhusoodanan, further added that they have shifted to new premises located at No. 8, 1 Cross, 17th Main, HAL 2nd Stage, Indiranagar, Bang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court is reflected in the subsequent judgment in the case of CCE, Visakhapatnam Vs. Mehta Co. (supra). Their Lordships observed as under: 25 . So far as the second issue is concerned, we fail to appreciate as to how the Tribunal could come to a finding, as recorded in the impugned judgment and order in view of the proposition of law already settled by this Court in the decision of Craft Interiors (supra). 26 . The decision in Craft Interiors (supra) has clearly laid down that ordinarily furniture refers to moveable items such as desk, tables, chairs required for use or ornamentation in a house or office. So, therefore, the furniture could not have been held to be immoveable property. 27 . A perusal of the records would also indicate that the Commissioner in his order has listed out various items which were held as furniture and while doing so, he has scrutinized the records to determine the immovability or movability of the items. A bare perusal of the said order would also indicate that he has given deductions for the items held as immovable. He has prepared Annexures 1, 2, 3 and 4 and the items mentioned in Annexures 1 and 2 have been held as furniture after proper examination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... KD parts in complete set are imported, for the purpose of charging customs duty, it shall be classified as complete machines under the chapter heading of the said machine but it is for limited purpose of charging customs duty and not resorting the term manufacture provided in Section 2(f) of Central Excise Act. Section 2(f) is reproduced below : Definitions. - In this Act, unless there is anything repugnant in the subject or context, - (f) manufacture includes any process, - (i) incidental or ancillary to the completion of a manufactured product; (ii) which is specified in relation to any goods in the Section or Chapter notes of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to manufacture; or (iii) which, in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labelling or re-labelling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer; and the word manufacturer shall be construed accordingly and shall include not only a person who employs hired labour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacturing activity has been undertaken by the Appellants and a new commercially known product has come into existence. The Revenue has rightly relied upon Note 6 to Section XVII which reads as under :- 6. In respect of goods covered by this Section, conversion of an article which is incomplete or unfinished but having the essential character of the complete or finished article (including blank , that is, an article, not ready for direct use, having the approximate shape or outline of the finished article or part, and which can only be used, other than in exceptional cases, for completion into the finished article or part), into complete or finished article shall amount to manufacture . 16. In the present case, undisputedly the entire parts and components of the furniture, workstations are not imported but certain indigenous parts and components are procured are also used in assembling the parts/ components of furnitures imported in CKD condition. Therefore, the judgments cited above are squarely applicable to the facts of the present case and assembly of parts and components of the furniture i.e. workstations in the premises of the customers would result into manufacture of exci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted the request of the appellant to extend cum-duty benefit following the judgment of the Hon ble Supreme Court in the case of Amrit Agro Industries [2007(210) ELT 183]. We find that in the event, the appellant had issued proper invoices indicating sale price of the goods and genuineness of which has not been disputed, the appellants are eligible for the benefit of cum-duty price in view of the amendment to Section 4 of the Central Excise Act, 1944 w.e.f. 14.05.2003. Also, the appellants are entitled to avail cenvat credit on the inputs on production of evidences of payment of duty on the said inputs to the satisfaction of the adjudicating authority. 19. In the result, the impugned orders are modified and the cases are remanded to the adjudicating authority to compute the demands with interest for the normal period of limitation only; also the benefit of cum-duty price and cenvat credit be allowed subject to production of necessary documents. As observed above, no penalty is imposable. The appeals filed by M/s. Reyami Office Furniture Equipments Pvt. Ltd. and M/s. Reyami Interiors Pvt. Ltd. are disposed of accordingly. 20. Further, we do not find justification for imposition of pen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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