Case Details: Larsen & Toubro Ltd. vs. Commissioner of Central Excise & Customs, Nagpur (2026) 40 Centax 263 (Tri.-Bom)
Judiciary and Counsel Details
- S/Shri S.K. Mohanty, Member (J) & M.M. Parthiban, Member (T)
- Shri Prakash Shah, Adv., for the Appellant.
- Shri C. Dhanasekaran, Special Counsel, for the Respondent.
Facts of the Case
The appellants were engaged in import and procurement of parts and components of earthmoving equipment and undertook activities of packing, repacking and labelling at their warehouse and dealer premises. The department initiated proceedings alleging that such activities amounted to manufacture under Section 2(f)(iii) of the Central Excise Act, 1944 read with the relevant entry in the Third Schedule, and issued show cause notices proposing demand of duty along with confiscation and penalty. The appellants were of the understanding that no manufacturing activity was carried out in such packing, repacking and labelling of spare parts and accordingly did not obtain registration or pay central excise duty. The matter was placed before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) for hearing and disposal.
CESTAT Held
The CESTAT held that the issue stood settled in light of the Larger Bench decision which examined the scope of the amendment made to the Third Schedule with effect from 29-04-2010. It observed that the amendment clarified that parts, components and assemblies of earthmoving equipment were not intended to be covered under the relevant entry prior to such date. The tribunal analysed Section 2(f)(iii) read with Section 11A of the Central Excise Act, 1944 and concluded that the activities of packing, repacking and labelling including affixing MRP did not amount to manufacture for the period prior to 29-04-2010. It was further held that the amendment was prospective in nature and therefore demands for the prior period were not sustainable. Accordingly, the impugned order was set aside and the appeals were allowed in favour of the appellants.
List of Cases Cited
- Commissioner v. JCB India Limited — 2014 (312) E.L.T. 593 (Tri. – Mumbai) — Referred [Paras 2.6, 2.7]
- JCB India Limited — Larger Bench order dated 27.02.2017 — Referred [Para 2.6]
- JCB India Limited v. Commissioner — (2023) 3 Centax 196 (S.C.) = 2023 (384) E.L.T. 134 (S.C.) — Referred [Para 2.7]
- Action Construction Equipment Ltd. v. Commissioner — (2023) 11 Centax 17 (Tri. – LB) — Followed [Paras 2.7, 4.1, 4.2, 5, 6]
