Customs, Excise and Gold Tribunal - Delhi
Hindustan Machine Tools Ltd. vs Asst. Collector Central Excise on 29 August, 1977
Equivalent citations: 1979CENCUS42D
ORDER
K.K. Kapoor, Appellate Collector
1. I have gone through the submissions made in the appeal which has also been argued before me orally by Shri T.P.S. Iyer, Shri S.G. Harsolekar and Shri M.R. Sahdev, Manager Planning of the appellants unit. The following are the submissions in the appeal:
(i) Out of 104 machines, which were in Stockton the midnight of 28th Feb. 1975/1st March, 1975, 13 had been sent out of their factory to various show-Rooms of India and abroad and 91 were still lying in the factory. These machines have not still been received back in the factory. They were included in the pre-budget stock because they were expected back. They were cleared before the levy of duty. on the machines with effect from 1.3.1975. In view of this position it is observed that they cannot be in any case taken as articles, on which duty should be paid.
(ii) The remaining 91 machines the Assistant Collector has held to be not fully manufactured because (i) In many cases accessories were required to be fitted to the machinery according to the orders received, (ii) Painting was done after the receipt of the orders from the customers and.
(iii) They had to be packed in wooden cases very securely before their removal. The Assistant Collector has also observed in his order dated 16.12.76 that out of 64 machines cleared by the appellants only 4 machines were supplied without extra accessories, which in other words would mean that the remaining 60 machines were fitted and supplied with accessories.
2. Each of the above grounds in respect of remaining 91 machines in Assistant Collector's order is discussed below:
(1) The catalogue supplied by the appellants shows that they supply basic machines fitted with standard equipment. Their price list is for the basic machines and standard equipment. Accessories are fitted only under specific advice of purchasers. The special equipment, which can be fitted is separately mentioned in the catalogue. There is thus a difference between a Standard Equipment and Special Equipment. It is optional for the buyer to purchase the machine with special equipment. This would show that the machines fitted with Standard equipment and for which they declare the price were complete in themselves. Addition of special equipment is therefore not a necessary condition for treating the machine as manufactured.
(2) With regard to the packing, it is the contention of the appellants that the machines were in fully manufactured condition and ready for marketing without packing and in fact they are delivering some machines locally without packing. Packing cannot, therefore, be considered as a process of manufacture. Packing may be necessary for delivering the goods in secure condition but they can be delivered in an unpacked condition. Packing in any case cannot be taken as process of manufacture.
(3) So far as painting is concerened, the appellants have contended that only the final coating is done by them before delivery of the machines and the rest of the processes of painting are invariably conducted by them before the machine is about to be delivered. I observe that the giving of final coating of paint according to the option of the customer cannot be said to be a process of manufacture.
3. In view of the above factual position, I set aside the order of the Asstt. Collector and accept the appeal.