ORDER
K. Sankararaman, Member
1. These are two appeals filed against two separate orders passed by the Addl. Collector of Central Excise, Belgaum holding that the appellant was liable to pay Central Excise Duty on truck bodies built on job work basis using duty paid chasis and other materials supplied free of cost by the customers. The duty demand relates to the period 6.3.86 to 12.6.86 and 23.5.87 to 20.6.87. Penalties of Rs. 50,000/- and Rs. 25,000/- have been imposed.
2. Ld. Counsel for the appellant stated that the activity in which appellant has been engaged in this regard does not constitute manufacturing process and no excisable goods come into existence. Appellant has not followed any Central Excise procedure on the above understanding that no manufacture is involved.
3. In reply, Shri R. Victor Thiagaraj, Sr. Departmental Representative stated that the issue has recently been decided by the Supreme Court vide their brief .
4. We find that the issue as to whether building of truck bodies or bus bodies from duty paid chasis constitutes manufacture attracting levy of Excise Duty was the subject matter of decision by the Punjab & Haryana High Court in U.O.I, v. Darshin Singh, Pavitar Singh and Ors.– . This was a decision by the Division Bench by that court dismissing the appeal by the department challenging the judgment of a Single Judge of that court allowing the writ petition of the assessee. The decision of the High Court was that such built trucks or buses are not dutiable under headings 87.02, 87.04 but under 87.07 attracting benefit of exemption from duty under notification No. 175/86-CE dt. 1.3.86. The Department’s appeal before the Supreme Court has been dismissed in Rama Body Builders and Ors.–1997 (8) SCC 482 which has been followed in . Following this view, we allow these two appeals and set aside the Impugned orders.
Pronounced and dictated in the open Court.