CCE, MUMBAI II Vs. MAHINDRA & MAHINDRA LTD.

JUDGEMENT

(1.) The issue involved in this appeal, filled, by revenue, is whether duty of excise is payable by M/s. Mahindra and Mahindra Ltd., in respect of goods received from job workers as motor vehicles under Chapters 87 of the Schedule to the Central Excise Tariff Act.

(2.) Shri M.P. Singh, learned D.R., mentioned that a Misc.Application No. E/Misc./37/2001 -B has been filed by the Commissioner praying for taking on record Section 11D of the Central Excise Act as amended by the Finance Act, 2000.Shri V. Lakshmi kumaran, leaned Advocate for the Respondents has no objection. Accordingly the Misc.Application, filed by the Commissioner is allowed.

(3.) Briefly stated the facts are that M/s. Mahindra and Mahindra manufacture motor vehicles. They were clearing cowl and chasis on payment of duty to Doby Builders who constructed the metal body on the said cowl and chasis and returned the vehicle under their gate passes to the Respondents.M/s.Mahindra and Mahindra subsequently sold these vehicle after testing etc. Under their own delivery notes cum inoices.in addition the Respondents were sending materials to M/s.Roplas (I) Ltd., Pune for body building under the provisions of Rule 57F(2) of the Central Excise Rules. According to the Department duty of excise was not paid on full value of vehicle at which the said vehicles were sold in the course of wholesale trade through the Respondents had recovered the duty from their customers.The Central Excise Officers seized 43 such vehicles which were provisionally released subsequently on execution of bond and payment of differential duty.A show cause notice dated 4.7.1991 was (sic) for demanding differential duty, for confiscating the seized vehicle and for imposing penalty on M/s.Mahindra and Mahindra.A few offices of the Respondents and Body Builders were also asked to show cause as to why penalty be not imposed on them under Rule 209A of the Central Excise Rules.The Collector, Central, Central Excise, under the impugned Order No. 28/92 dated 13.7.92, dropped the proceeding against all the notices, holding that body built vehicles were classifiable under Sub -heading 8707.00 of C.E.T.A.; body -builders were not related persons; thee was no allegation in the show cause notice that body -builders were under the control direct or indirect of the Respondents; that in view of the decision in Ujagar Prints vs. U.O.I., 1989 (39) ELT 493 (SC), no recovery of any differential duty was warranted inspite of the fact that M/s. Mahindra and Mahindra charged higher prices from their customers.