NGEF LIMITED Vs. COMMISSIONER OF CENTRAL EXCISE, BANGALORE

JUDGEMENT

(1.) THE appellant Company is a public sector undertaking owned by the Government of Karnataka, engaged in the manufacture of electrical and electronic goods, for the manufacture of some of the said goods, tools, jigs and fixtures are required. They manufactured tools, jigs and fixtures intended to be used within the factory and used the same for the manufacture of some of the goods. Hand tools falling under erstwhile Tariff item 51A and now falling under sub -heading No. 8207.00 of the new tariff were brought under Central Excise levy for the first time with effect from 1 -3 -1974. Jigs and fixtures falling under the erstwhile Tariff item 68 and now falling under sub -heading Nos. 8466.00 of the new Tariff, were brought under excise levy for the first time with effect from 1 -3 -1975 when Tariff Item No. 68 was introduced. Therefore, the hand tools manufactured prior to 1 -3 -1974 and jigs and fixtures manufactured prior to 1 -3 -1975 were beyond the scope of excise levy. The appellant was manufacturing such goods right from 1968 onwards which have been exempted under the Notification No. 58/86, dated 10 -2 -1986. Similarly, the jigs and fixtures intended for use within the factory in which they are manufactured have also been exempted under Notification No. 220/86, dated 2 -4 -1986. The appellant captively utilised the tools, jigs and fixtures within the factory by availing exemption. However, during the years 1987 -88, 1988 -89 and 1989 -90 the appellant had to get certain intermediate goods manufactured by job workers for which the appellant had to supply tools, jigs and fixtures which were under use in the factory. They were returned to the factory of the appellant by the job workers after the job work was executed. These goods received back from the job workers were once again used within the factory of the appellant. Pursuant to audit objection duty of Rs. 3,05,709.65 should be paid in respect of the tools, jigs and fixtures removed to the premises of the job workers. The appellants paid the said amount under protest to the Assistant Collector of Central Excise, III Division, Bangalore, was requested for an appealable order. The Collector of Central Excise, Bangalore, issued a Show Cause Notice to the appellant on 23 -3 -1992, passed the impugned order confirming the duty of Rs. 3,05,709.65 paid by the appellant under protest and imposing a penalty of Rs. 5,000/ - on the appellant company. Aggrieved by the said order this appeal is preferred.

(2.) GROUNDS of Appeal are : -

(3.) WE have heard both sides and considered the matter and find : -