Customs, Excise and Gold Tribunal - Tamil Nadu
Associated Tyre Machinery Co. Ltd. vs Commissioner Of Central Excise, ... on 24 August, 2001
Equivalent citations: 2002(149)ELT136(TRI-CHENNAI)
JUDGMENT
S.L. Peeran, Member (Judicial)
1. The short question that arises for consideration in this appeals is as to whether the process of reconditioning of old kiln shell would bring into existence a new product for levy of duty.
2. The appellants were entrusted for repairing and reconditioning of old kiln shell by M/s. India Cements Ltd. on job work basis. The appellants did not bring into existence a new product according to them, but state that were they only reconditioning it by adding extra material. The diameter and the weight of the kiln shells were not increased. It is stated by the appellants that the lower authority's view that on such reconditioning a new kiln shell came into existence as a there was manufacturing activity and it conform with the ISI specification and therefore is sufficient to hold the same as a new product is not a correct finding. The Ld. Consultant submits that test was carried out only to find out its suitability and which did not alter the position of the old kiln shells being repaired and serviced. There is no dispute that old kiln shells had been entrusted for reconditioning and such reconditioning did not bring into existence a new product for the purpose of levy of duty. He relies on the following judgements.
i) Ugar Sugar Works Ltd. v. CCE 1990 (47) elt 561 (T)
ii)CCE v. Maize Products Ltd.
1990 (49) ELT 544 (T)
1994 (73) ELT 167 (T)
2. Appearing on behalf of the Revenue, the Ld. DR submits that the Commissioner has given a clear cut findings that the appellants had tested the product to bring up to the ISI standard. It cannot be considered as old one as it had been re-processed and had been cleared as a new kiln. therefore there is no infirmity in the impugned order and demands are required to be confirmed. Because the process undertaken on the old kiln, it would amount to manufacture in terms of Section 2(f) of the Central Excise and Salt Act and the duty of Rs.85,895/- confirmed should be upheld.
3. On a careful consideration of the submissions made by both the sides, the Bench notices that old kiln shells were received from M/s. India Cements Ltd. by the appellants for re-processing and re-conditioning which is not denied by the Revenue. The Ld. Commissioner has clearly noted that the old kilns were reconditioned. However, he has proceeded to confirm the duty on the basis that the process brings into existence a new product which it satisfies to the ISI specifications. Therefore, it amounts to process of manufacture and hence it is a new product for the purpose of levy of duty.
4. On a careful consideration, I am of the considered opinion that the fact of reconditioning of old kiln is not disputed. I notice that this issue was considered by the Hon'ble Apex Court in the case of Lathia Industrial Supplies Ltd. v. UOI reported in 1987 (29) ELT 751 wherein it was clearly held that re-processing or reconditioning of old and used rollers does not amount to manufacture. This view was upheld again by the Tribunal in the case of CCE v. 2000 (36) RLT 158 wherein it was noted that the rubber lining in used and old tank does not amount to manufacture. The Tribunal has noted large number of other judgements to hold that such reprocessing work is not a process of manufacture. In view of this judgements the findings arrived at by the Commissioner is not sustainable and hence the impugned order is set aside and the appeal is allowed with consequential relief if any.
(order dictated and pronounced in the open court)