M/S Continental Foundation Joint ... vs Commissioner Of Central ...

2. The appellant M/s Nathpa Jhakri Power Corporation (in short 'NJPC') is a Joint venture between the Government of India and Govt. of Himachal Pradesh, set up for the purpose of construction of a power-project between the towns of Nathpa- Jhakri in Himachal Pradesh known an Nathpa Jhakri Power Corporation funded by the World Bank. The civil work relating to the project was allotted to three construction companies viz. M/s Continental Foundation Joint Venture (in short 'CFJV'), M/s Nathpa Jhakri Joint Venture (in short 'NJJV') and M/s Jai Prakash Hyundai Consortium, (in short 'JPHC'). The agreement was entered into by M/s NJPC and the construction companies to provide inter alia 'mix concrete' for execution of various items of work under the contract.

3. The Commissioner of Central Excise, Chandigarh issued a show cause notice dated 20.1.1999 to all the above parties alleging that the construction companies employed by M/s NJPC were manufacturing Ready Mix Concrete (in short 'RMC') on which no central excise duty is being paid. Since the said RMC falls under Chapter Heading No.3824.20 of the Schedule to the Central Excise Tariff Act, 1985 (in short 'Tariff Act') and is subject to Central Excise duty under Central Excise Act, 1944 (in short the 'Act'), duty is payable. All the three parties are adopting the same method of manufacture of RMC for which the rock is blasted from the designated quarry of M/s NJPC. It is transported to the crusher and crushed to the specified sizes and specific quantity at the project site. Some aggregate, cement and sand are also produced from the crushing plant set up at the site. Some natura1 sand is also used. The aggregate and sand are transported and stored in bins adjacent to the automatic batching plant. The cement purchased from the market is stored in the cement silons at the site. The batching plant is an automatic plant which regulates and delivers the specified sizes and quantities of aggregate, sand and cement into the mixing drums through the built- in-conveyor. The admixture for water reduction or air entraining is incorporated in the concrete as per the approved mix design given by the NJPC. The whole process is fully automatic and is electronically controlled. The concrete of approved mix design and the specified quantity is manufactured in the batching plant strictly in accordance with IS: 456-1978 as stipulated in the contract with M/s NJPC. The concrete so produced is transported by transit mixers upto the location of placement and is placed at the specified location by concrete pumps or placers before the setting time of concrete, which varies depending upon the type of cement used. Noticee companies are manufacturing RMC but with some motive, they are naming it as mixed concrete to evade the central excise duty. There is a difference between the process and method of manufacture of RMC provided in the Bureau of Indian Standards (in short 'BIS') literature under IS:

9. We are not really concerned with the other issues as according to us on the challenge to the extended period of limitation ground alone the appellants are bound to succeed. Section 11A of the Act postulates suppression and, therefore, involves in essence mens rea.

14. On the ground of adjudication beyond the normal period of limitation and non-availability of the extended period of limitation, the appeals are allowed. No costs.