ORDER
S.S. Kang, Member (J)
1. The appellant filed this appeal against the Order-in-Original dated 10-4-1989 passed by the Additional Collector of Central Excise whereby he confirmed the demand of Rs. 86,927.40 on the steel structural and cement blocks manufactured by the appellant during the period from 1-3-1986 to 30-4-1988 under Rule 9(2) of the Central Excise Rules, 1944 read with provisions of Section 11A(1) of Central Excise Rules, 1944. A penalty of Rs. 25,000/- was also imposed under Rule 173Q of the Central Excise Rules, 1944.
2. Ld. Advocate for the appellants submits that the appellant constructed a godown and store within their factory premises. For construction of those godowns and stores they fabricated cement blocks with their labour and from the material supplied by appellants and these cement blocks were fabricated within the appellant’s factory premises. The appellants also fabricated steel item by cutting angles and other shapes and sections of steel into required sizes, drilling and punching holes etc. The steel items were fabricated as per the designs and specifications required for the construction of the godown and stores. The fabricated steel items were used for the construction of stores. These cement blocks were used for construction of the walls of a factory godown and store building. He further submitted that the cement blocks and steel structurals were fabricated in the factory and the godown and stores were constructed in the factory and they were within the knowledge of the respondent. He submits that allegation in the show cause notice is that during the period 1-3-1986 to 30-4-1988 they carried out the fabrication and the show cause notice was issued on 25-10-1988. In these circumstances he prays that the extended period is not invokable in the present case. On merits he submits that fabrication of steel items was done by cutting angles and other shapes and sections of steel into required sizes, drilling punching holes, welding etc. and this activity does not amount to manufacture. He relied upon the decision of the Tribunal in the case of S.A.E. (India) v. C.C.E. reported in 1988 (36) E.L.T. 613. Regarding cement blocks he submit that the building material is classifiable under Chapter Heading 68 of the Central Excises Tariff Act, 1985 and the Central Govt. issued a Notification No. 57/89-N.T.-C.E., dated 20-11-1989, under Section 11C of the Central Excises and Salt Act, 1944 whereby it was notified that the duty of excise, on building material manufactured at site of construction of building for use on such site was not being leviable during the period commencing on 28-9-1986 and ending on 31-10-1988. Ld. Counsel submits that the building material falling within the Chapter 68 is exempt from duty under this exemption Notification and the benefit of this exemption Notification is fully applicable in the case of appellant. He therefore prays that the appeal be allowed.
3. Ld. SDR appearing on behalf of the respondent submits that appellant manufactured the cement blocks falling under chapter Sub-heading 6807.00 and steel fabricated structural falling under chapter Sub-heading 7308.90 of the Central Excise Tariff Act, 1985 and cleared cement blocks without following the provisions of Central Excise Rules and the appellants also had not obtained Central Excise licence and had not filed any classification listed or price list in respect of the goods manufactured by them. In these circumstances he prays that the appeal be dismissed.
4. Heard and considered the submissions made by both the parties. In this case a show cause notice dated 25-10-1988 was issued to the appellants alleging that during the period from 1-3-1986 to 30-4-1988 the appellants manufactured excisable goods i.e. steel fabricated structurals and cement blocks falling under Chapter Sub-heading 7308.90 and 6807.00 without following the procedure laid down under the Central Excise Rules, 1944. It was also alleged in the show cause notice that the appellants manufactured the goods without obtaining Central Excise licence without filing classification list and price list in proper form. The goods were cleared without payment of Central Excise duty. The appellants were engaged in the manufacture of writing and [printing] papers falling under Chapter Heading 48 of the Central Excise Tariff Act, 1985. During the period from 1-3-1986 to 30-4-1988 they constructed godowns and store buildings within their factory premises. For construction of these godowns and stores they fabricated cement blocks and also fabricated some steel items by cutting angles and other shapes and sections of steel into required sizes drilling and punching holes, painting, welding etc. The steel items were fabricated as per the designs and specifications required for constructions of the godowns and stores in question. The fabricated steel items were used in supporting the roof of the godown and store buildings. The Tribunal in the case of S.A.E. (India) Ltd. v. C.C.E. reported in 1988 (36) E.L.T. 613 held that fabrication of steel structurals does not amount to manufacture and mere cutting to size, punching and used in constructions does not amount to manufacture as no final product comes into existence.
5. In the facts and circumstances of the present case and in view of the above decision mentioned above we hold that the fabrication of steel structurals does not amount to manufacture.
6. In respect of cement blocks it is not disputed by the Revenue that the cement blocks were fabricated at the building site during the period 1-3-1986 to 30-4-1988. The Central Govt. vide Notification No. 57/89-N.T.-C.E. dated 20-11-1989 issued under Section 11C of the Central Excises and Salt Act, 1944 notified that the duty of excise on building material falling within Chapter 68 of the Schedule to the Central Excise Tariff Act manufactured at the site of construction of building and used at such site was not being levied during the -period commencing on 28-2-1986 and ending with 31-10-1988. In the present case the cement blocks were fabricated at site and used in the construction of godowns and stores between 28-2-1986 to 31-10-1986. Therefore they are covered under the Notification and are not liable for duty. In view of the above discussion the impugned order is set aside and the appeal is allowed.