Customs, Excise and Gold Tribunal - Mumbai
Simplex Concrete Piles (India) Ltd. vs Commissioner Of Customs And Central ... on 15 June, 2004
Equivalent citations: 2004(172)ELT369(TRI-MUMBAI)
ORDER Moheb Ali M., Member (T)
1. The appellant company entered into contract with Gujarat Maritime Board (GMB) for repair and rehabilitation of the break waters of Veraval Port. Under the terms of the contract the appellant has to manufacture tetrapodes at their work sits at Veraval as per the drawing provided by GMB. The work site is situated around 1.5 Kms. away from break water when the said goods are supposed to be placed. It is also a fact that the appellant fabricated the tetrapodes at a hired private plot in the acquisition of which GMB has played a role. The tetrapodes, as mentioned earlier are being fabricated by the appellant in terms of the contract and were being cleared to the place were they are required to be installed. The question for consideration is whether in terms of Notification No. 5/98 CE dt. 2.6.98, 5/99-CE dt. 20.2.99 and 6/2000-CE dt. 1.3.2000 the goods under question are exempt from payment of duty. The said notifications exempt goods falling under Chapter 68.07 of CETA when manufactured at site. There is no dispute that the goods in question fall under Tariff Heading 68.07. The dispute confines to whether or not these goods are manufactured at site.
2. The Ld. Commissioner observes that it is not disputed that the tetrapodes were cast at site other than the site where these were actually used. He further observe that the above said notifications provided exemption to the goods falling under Chapter heading No. 68.07 if such goods are manufactured at the site of construction for use in the construction. He refers to Board's Circular No. 456/22/99/CX dt. 18.5.1999 and analysis it to determine whether the appellant comes within the meaning of the clarification issued by the Board. !n the said circular it has been clarified that the term site shall include any premises made available to the fabricator of the goods falling under Chapter 68.07 by way of a specific mention in the contract, provided further that the goods fabricated at such premises are solely used in the said construction work only. The Commissioner there upon observes that the appellant fabricated the goods in question at a site hired by them and not at site specifically mentioned in the contract for such construction. It has been brought on record that the site is situated 1.5. kms. away from Veraval Port and is hired by the appellant. He therefore says that the site has not been provided by the principals and for that reason alone, he holds that the notification referred to above is not applicable to the goods fabricated by the appellant. He also observes that a notification has to be strictly construed etc. before the benefit of a notification is extended to an assessee.
3. Heard both sides.
4. The Board's circular referred to by the Commissioner takes note of the fact that several disputes have arisen on the interpretation of the word 'site' in Notification No. 5/98CE. After considering various representations the Board has decided that the expression site may not be given a restrictive meaning and shall include any premises made available to the manufacture of goods falling under Heading No. 68.07 of the Schedule to Central Excise Tariff Act, 1985 by way of a specific mention in the contract for such construction work provided that the goods manufactured at site premises are solely used in the said construction work only. In the present case that the goods manufactured by the appellant are solely used in the construction work of Veraval Port is not in doubt. It is also not in doubt that the GMB have approved the site in which the fabrication work was undertaken and also helped the appellant in procuring that site. The fact that the goods would be manufactured at a particular site approved by GMB shows that both the principals and the agent in this case are aware of the details of the site. In such circumstances to say that the GMB has not made the premises available to the manufacturer of goods is farfetched.
5. We also observe that even before the Board has clarified the exact purport of the word 'site' the Tribunal as held that site of construction of goods falling under Chapter heading 67.07 need not be necessarily at the place of construction. In the case of V.M. Jog v. Commissioner of Central Excise, Mumbai [2003 (154) E.L.T, 172 (Tri. Mumbai)] the Tribunal held that the fact that site of construction Is half a kilometer away from the flyover does not disentitle the appellant before them from seeking the benefit of notification No. 5/98. In the case of Delhi Tourism & Transportation Devep. Corporation v. CCE, New Delhi [1999 (114) E.L.T. 421 (Tribunal)] the Tribunal held that the fact that girders were cast at a place situated far away from the construction of a flyover in Delhi does not been that the girders are not manufactured at site particularly when the principal has allotted the site of construction to the contractor. In the present case the only difference appears to be that the principal has not allotted the site but has helped the contractor (the appellant) in procuring the site where the tetrapodes could be fabricated. This could hardly be a reason to deny a substantial benefit accruing to the appellant. The goods fabricated of the appellant fall under the tariff heading mentioned in the notification and the entire goods produced at this site were used in the construction of break waters as stipulated in the contract.
6. In the light of what has been discussed above, we set aside the order of the Commissioner and allow the appeal.