Aditi Bansal, OP Jindal Global University
INTRODUCTION & FACTS OF THE CASE
The facts of this case are undisputed as both the appellants and the respondents agree to the same.
The appellants (Triveni engineering) are manufacturers of turbo-alternators, which have both an alternator and a steam turbine as two separate parts.
At their manufacturing facilities in Bangalore and Allahabad, they produce steam turbines for which they are required by law to pay excise duty and they have been doing so. They buy the alternator from a duty-paid manufacturer, and it is delivered to the client's location.
The center excise collectors believe that excise duty is also liable on the turbo-alternators and send in show-cause notices for the same stating that, under heading 85.02 of the Central Excise Tariff Act, 1985 (often referred to as “the CET Act”), turbo-alternators are subject to excise duty.
The process of setting up the turbo-alternators also remain undisputed. Both the parts of the turbo- alternators, i.e., the steam turbine and the generator are brought on site. A cemented platform is constructed on site with pockets. After levelling the platform that serves as the base, the steam turbine is set up there and then secured by bolting the turbine into the pocket. Additionally, the alternator is attached and fastened to the steam turbine using a high-speed connection between the alternator's shaft and steam turbine outer shaft.
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