Customs, Excise and Gold Tribunal - Delhi
Cce, Pune vs M/S. Telco on 10 May, 2001
Equivalent citations: 2002(148)ELT652(TRI-DEL)
ORDER
G.R. Sharma
1. In the impugned order Ld. Commissioner (Appeals) held "In view of the fact that hydraulic power pack and coolant unit is itself a machinery, will not make them non-eligible for the benefit of notification No. 281/86 once they satisfy the conditions prescribed in the notification. Hydraulic power pack and coolant unit are used in the factory for repair and maintenance which will include replacement and as such the benefit of Notification is available".
Being aggrieved by this offer, Revenue has filed the captioned appeal.
2. The facts on the case in brief are that the appellants are engaged in the manufacture of motor vehicles. The appellants filed a classification list effective from 29.10.90 wherein they classified hydraulic power pack and coolant unit under Chapter sub-heading 8479.00 and claimed exemption under Notification No. 281/86 dt. 24.4.86 as amended. On scrutiny of the classification list the Department noticed that hydraulic power packs were nothing but hydraulic engines. A SCN was issued to the appellant asking them to show cause as why hydraulic power packs should not be classified under Chapter sub-heading 8412.00 and why exemption under Notification No. 281/86 should not be denied to them and why duty should not be demanded. In reply to the SCN the appellants submitted that the Department has not adduced any evidence to show that hydraulic power pack is a hydraulic engine and hence classifiable under sub-heading 8412.00 It was argued that hydraulic power pack is a device and is used for transmitting power whereas an engine is a machine that consumes fuel and converts the fuel energy into mechanical motion. It was also argued that hydraulic power pack and coolant unit formed part of machines; the they are components of them machines and therefore, exemption under Notification No. 281/86 is available. The Asst. Collector confirmed the demand. On appeal against this demand Ld. Commissioner (Appeals) held as indicated above.
3. Arguing the case for Revenue Shri R.C. Sankhla, Ld. DR submits that hydraulic power packs and coolant units are used captively either as inputs in the manufacture of machines or machine tools on which the assessee pays Excise Duty; that power packs and coolant units are items of machinery and cannot be considered components or parts of machinery; that replacement of these goods does not amount to replacement of a part of particular machinery but replacement machinery itself; that under Notification No. 281/86, the benefit of exemption is admissible for items used for repairs and maintenance of the installed machinery and that it cannot be extended to replacement of the machinery as a whole; that there is distinction between the items covered by the decision of the Hon'ble CEGAT in the case of Pratap Steel Rolling Mills on the said gods and therefore, the ratio of the decision of the Tribunal is not applicable to the facts of the present case.
4. Shri B.L. Narshima and Shri M.P. Devnath, Ld. Counsels appear for the respondent and submit that the decision of the Tribunal in the case of Pratap Rolling Mills vs CCE contained in Final Order No. E/209/93-E an followed by the Tribunal in the case of CCE vs TELCO reported in 2001/(96)ECR.168. Ld. Counsel submits that in this case the Tribunal held that control panels and controllers and parts of manipulators not being complete by themselves out being parts of machine tools used in the factory for repair and maintenance are eligible for the benefit of Notification NO. 281/86. Ld. Counsel, therefore, submitted that the appeal of revenue may be rejected.
5. We have heard the rival submissions. We have perused the case law cited and relied upon by both sides. We note that this Tribunal in para 4 & 6 of this judgment in the case of Pratap Steel Rolling Mills vs CCE, Indore held that "I have gone through the submissions of the appellants. The Tribunal in the case of Pratap Rolling Mills vs CCE in the Final Order No. 301/93-B1 dt. Nil of Oct'93 has held that rollers which are manufactured and used in the rolling mills can be considered as complete machinery. It has been emphasised by the appellants that rollers and control penal are integral part of machine tools. They are required to be replaced by removing parts. In vie of the factual position that these are used in the factory for repairs and maintenance, the benefit of Notification No. 281/86 cannot be denied".
6. Having regard to the facts of the case that hydraulic power pack and coolant unit are not complete by themselves but are parts of machines, they are entitled for exemption in terms of Notification NO. 281/86 even if they are used as replacement. Following the ratio of the decision of this Tribunal in the case of Pratap Rolling Mills which was subsequently followed by the Tribunal in the case of CCE, Pune vs TELCO, we do not see any reason to disagree with the decision of the Tribunal. Following the ratio of the decision of the Tribunal, the appeal of Revenue is rejected.