M/S. MITTAL ENGINEERING WORKS (P) LTD. versus COLLECTOR OF CENTRAL EXCISE, MEERUT

Citation: [1996] SUPP. 8 S.C.R. 796 · Decided: 19-11-1996 · Supreme Court of India · Bench: S.P. BHARUCHA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
B 
c 
MIS. MITTAL ENGINEERING WORKS (P) LTD. 
v. 
COLLECTOR OF CENTRAL EXCISE, MEERUT 
NOVEMBER 19, 1996 
[S.P. BHARUCHA AND K. YENKATASWAMI, JJ.] 
Central Excise and Salt Act, 19./4: 
Mono Vertical Ciystallisers-He/d, are not 'goods' within the meaning 
of the Act and, therefore, not eligible to excise duty. 
Stare decisis-A decision can;10t be relied upon in support of a 
proposition that it did not decide. 
The appellant--assessee was required to pay excise duty on mono 
D vertical crystallisers patented by it The said crystalliser, which was 
used in sugar factories to exhaust molasses of sugar was a tall structure, 
like a tower, with a platform at its summit. The assessee resisted the 
demand stating that the parts of the crystalliser came into existence 
only after assembling and erection done at the site; that the process 
involved welding and gas cutting; and that the assembly and erection 
E was done by the assessee but the fabrication materials were procured 
from the stores of the customer for which customer sent to the 
appellant the debit notes. 
The Collector of Central Excise confirmed the deman<t·holding 
that the mono vertical crystalliser should be termed as 'goods' and 
F its manufacture was complete in all respects at the1 time of its clearance 
from the assessce's premises, and its delivery1 in knocked down 
condition was only to facilitate transport. The'appeal filed by the 
asseess was dismissed by the Customs Excis~ and Gold (Control 
Appellate Tribunal. Aggrieved, the assessee filed the present appeal. 
G 
Allowing the appeal, this Court 
HELD : I.I. Mono vertical crystallisers are not 'goods' within 
the meaning of Central Excises and Salt Act, 1944, and, therefore, 
not exigible to excise duty. The cyrstalliser has to be assembled, erected 
H and attached to the earth by a foundation at the site of the sugar 
796 
MIITALENGG WORKS(P)LTD.1· COLLECTOROFCENTRAL 
797 
factory. It is not capable of being sold as it is, without anything more. A 
The erection and installation of a plant is not excisable. To so hold' 
would, impermissibly, bring into the net of excise duty all manner of 
plants and installations. [801-A,q 
Quality Steel Tubes (P) Ltd. v. Collector of Central Excise, U.P., 
(1995[ 2 sec 372, relied on. 
B 
Narne Tuleman Manufactures Pvt. Ltd., Hyderabad v. 
Collector of Central Excise, Hyderabad, [1988) Supp. 3 SCR 1, 
distinguished. 
Union of India and anr. v. Delhi Cloth and General Mills Co. Ltd. C 
AIR (1963),SC 791; Bhor Industries Ltd., Bombay v. Collector of Central 
Excise, Bombay, )1989) 1 SCC 602; South Bihar Sugar Mills Ltd. Etc. v. 
Union of India and Ors., )1968) 3 SCR 21; Union Carbide India Ltd. v. 
Union of India, )1986) 2 SCC 547 and Indian Cable Company Ltd., 
Calcutta v. Collector of Central Excise Calcutta & Ors., [1994) 6 SCC 
610, referred to. 
D 
1.2 The Tribunal took an unreasonable view of the evidence. 
The fact that there was no debit note in respect of one customer could 
not reasonably have led the Tribunal to conclude that in the case of 
that customer a complete mono vertical crystalliser had left the E 
appellant's factory and that, therefore, mono vertical crystallisers 
were marketable. [801-E-F] 
2. A decision cannot be relied upon in support of a proposition 
that it did not decide. [801-B] 
Narne Tulaman Manufactures Pvt. Ltd., Hyderabad v. Collector of 
Central Excise, Hyderabad, [1988] Supp. 3 SCR 1, referred to. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2919 of 
1986. 
From the Judgment and Order dated 14.5.86 of the Customs Excise 
and Gold (Control) Appellate Tribunal, New Delhi in A. No. E. 1631 of 
1984-B-I in (Order No. 239/86-B-1) 
F 
G 
V. Lakshmikumaran, V. Sridharan and V. Balachandran for the H 
798 
SUPREME COURT REPORTS [1996] SUPP. 8 S.C.R. 
A Appellant. 
R. Mohan, S.D. Sharma and Ms. Sushma Suri for the Respondent. 
The Judgment of the Court was delivered by : 
B 
BHARUCHA, J. The order of the Customs, Excise and Gold 
(Control) Appellate Tribunal under appeal confirms the levy of excise 
duty on mono vertical crystallisers.· 
Mono vertical crystallisers are used in sugar factories. Their function 
is to exhaust molasses of sugar. A general note placed on the record of the 
C Tribunal by the appellants, who have patented the mono vertical crystalliser, 
describes its function and manufacturing process. The mono vertical 
crystalliser is fixed on a solid RCC slab having a load bearing capacity of 
about 30 tones per sq.
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