- (1.) Challenge is to notice dated 13.9.1990, Annexure P.3 by the petitioner-company which is a Government of India Undertaking registered under the Companies Act, 1956.
(2.) Briefly, the facts as narrated in the petition may be noticed. Tenders were invited for fabrication and erection work which was originally awarded to the petitioner-company by Punjab State Electricity Board. The petitioner transferred the job of fabrication of steel structures to M/s Amarnath Aggarwal construction (P) Limited, Panchkula the contractor. The petitioner-company also provided steel, trusses, angles, channels and other raw material to the contractor. The contractor fabricated the structure in accordance with the drawings of the petitioner-company under their supervision at the site and the inspection was carried by the Site Engineer of the petitioner-company. The Central Excise Preventive Staff Patiala, visited the project site of the petitioner and issued a show cause notice dated 13.9.1990, Annexure P.3 to the petitioner-company as to why excise duty amounting to Rs.12,72,619.60 not paid on the steel structures be not recovered from it under Rule 9 (2) of the Central Excise Rules 1944 (in short, "the Rules) read with Section 11A of the Central Excise and Salt Act, 1944 (in short, "the 1944 Act") and also penalty be not imposed under Rule 173Q of the Rules. Hence this petition.
(3.) Learned counsel for the petitioner-company contended that the petitioner company was not engaged in the manufacture of steel structures, columns and trusses etc. The petitioner was fabricating and erecting at site for the project of Punjab State Electricity Board for which fabrication of trusses, columns, purlins and roofing sections were undertaken and this did not amount to manufacture of any standard product which was marketable. The petitioner was fabricating as per specific drawings and designs which was embedded in the earth and could be considered to be immovable property. Further, the contract was given to M/s Amarnath Aggarwal Construction (Pvt.) Limited on job charge basis who had fabricated and erected the steel structures whereas the material had been supplied by the petitioner. It was urged that the petitioner-company was getting the work done of fabrication of structural shape from M/s Amarnath Aggarwal Construction (Pvt.) Limited which was at the site of construction itself, the same would not be covered under section 2(f) of the 1944 Act defining 'manufacture'. It was pleaded that no excise duty was, thus, leviable under Section 3 of the 1944 Act. According to the learned counsel, the Government of India had issued a notification No.61/90-CE dated 20.3.1990 (Annexure P.7) in exercise of powers conferred under section 5A(1) of the 1944 Act whereby goods falling under heading 73.08 of the Schedule to the Central Excise Tariff Act, 1985 (in short, "the 1985 Act") had been exempted which were fabricated at the site of construction work for use in such construction work from the whole of the duty of excise leviable thereon.;