Case Law Details
Volvo Buses India Pvt Ltd Vs Commissioner of Central Excise (CESTAT Bangalore)
CESTAT Bangalore held that benefit of exemption notification no. 06/2006-CE dated 01.03.2006 and 12/2012-CE available to the motor vehicle manufactured as ownership of chassis was transferred after the sale of the same by VIPL to Appellant.
Facts- The appellants are manufacturers of parts and accessories of buses falling under Chapter sub-heading 87082900 of Central Excise Tariff Act, 1985 (CETA). During the course of verification of refund claim, it was noticed by the Department that the appellant also undertakes the activity of body building on the duty paid chassis. However, no duty was paid on the said manufactured body built motor vehicles for the period 08/2008 to 07/2012.
Consequently, an investigation on non-payment of excise duty on the body building activities was initiated and on completion of the same, show-cause notice was issued to the appellant alleging that during the said period though they have manufactured 2545 numbers of motor vehicles for transport of more than 12 persons falling under Chapter heading 8702 of CETA, 1985 but failed to pay a duty of Rs.67,46,70,752/-; consequently on adjudication, the demand was reduced to Rs.58,03,73,082/- with interest and penalty of the equivalent amount imposed on the appellant company and Rs.50,000/- on Shri Ramamurthy, Director of the appellant.
Conclusion- The chassis manufactured by M/s VIPL was sold to the appellant on payment of applicable VAT and excise duty. There is no condition appended to such a sale which would indicate the transfer of title, possession etc. is incomplete. The appellant after receipt of the chassis undertake the activity of body building and dispose of the buses to their customers. In these circumstances, merely because the appellant and M/s VIPL belong to a common group of companies, the transaction between them cannot be considered other than the sale or purchase of the chassis and the Ownership of the chassis not transferred after the sale of the same by VIPL to Appellant.
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