2025-VIL-381-CESTAT-MUM-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Packing, repacking and relabelling of spare parts of earthmoving equipment - Respondent is engaged in the manufacture of construction machines – Appellant undertakes the activity of packing, repacking and relabelling of spare parts of earthmoving equipment. Department had initiated show cause proceedings for demand of central excise duty for the period from June 2006 to May 2010, contending that the activity of packing, labelling etc. amounts to 'manufacture' under the Central Excise Act, 1944 - Whether the activity of packing, labelling, repacking and relabelling of spare parts of earthmoving equipment by the respondent amounts to 'manufacture' under the CEA, 1944 thereby making the respondent liable to pay excise duty – HELD - The Larger Bench of the Tribunal held that the earth moving machines involved in the present case are not "automobiles" and it would not be appropriate to borrow the meaning of the word "automobile" or motor vehicle under the Motor Vehicles Act, 1988 or the Air (Prevention and Control of Pollution) Act, 1981 merely because the word "automobile" has not been defined in the Central Excise Act, Central Excise Tariff Act or the Notifications issued by the Central Government - The Larger Bench referred to the dictionaries to find out the general sense in which the word "automobile" is understood in common parlance, and concluded that automobiles are conveyances for transportation of passengers and goods on road. Since the earth moving equipment in the present case do not fall under the category of "automobiles", the activity of packing, labelling, repacking and relabelling of their spare parts by the respondent cannot be considered as 'manufacture' under the Central Excise Act. Accordingly, the Larger Bench held that the adjudged demands for the period prior to 29.04.2010 are not sustainable - the issue is no longer res integra. In view of the decision given by the Larger Bench - the appeal filed by Department is dismissed
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