Judgment:
1. In this appeal filed by the Revenue, the matter relates to the classification of wound Rotors and Stators fixed with the shaft of the pump portion to make the mono block pump. The respondent M/s. Saga Windel Engineers Pvt. Ltd., Ahmedabad were engaged in the manufacture of Rotors and Stators. They paid excise duty at appropriate rates on the Rotors and Stators and when these Rotors and Stators were fixed with the shaft to make the mono block pump, the duty was again charged as leviable on electric motors with set-off of the duty already paid on Rotors and Stators. Afterwards, they filed a refund claim on the ground that no excise duty was payable on the stage when the Rotors and Stators were used in the manufacture of mono block pump. It was their contention that electric motors as commercially understood does not come into existence and that once the Rotors and Stators are fixed on the Shaft of the pump it is the pump and not the motor which come into existence. It is seen that the Asstt. Collector had accepted their contention and had sanctioned refund. He had also deducted the amount of Rs. 44,50_.32 (sic) being duty on the redetermined assessable value of electric motors from the claim of Rs. 2,13,460.23. This order of the Asstt. Collector was challenged by the Department before the Collector of Central Excise (Appeals), Bombay. The Collector (Appeals) after discussing the matter, at great length, did not find any reason to interfere with the order passed by the Asstt. Collector of Central Excise. Hence this appeal by the Revenue.
2. We have gone through the facts and circumstances of the case and have given our due consideration and thought to the submissions made by both the sides. We find that the Asstt. Collector, Central Excise, Division-III, Ahmedabad under his order dated 15-6-82 had observed that in the case of M/s. Saga Windel Engineers Pvt. Ltd. the electric motor does not come into existence and is not separable easily from the mono block pump. The assessees had sought exemption under Notification No.73/88-C.E., dated 13-4-88 but the same was denied to them by the Asstt.
Collector in the aforesaid order, who had held that the assessee was required to pay CED on rotors and stators under T.I. 30D of the old Central Excise Tariff, which covered parts of electric motors (including Die Cast Rotors). In their cross objections filed before the Tribunal, the respondent had clarified that in the course of manufacture of mono block pumps, electric motor in an identifiable and separable manner does not come into existence at any stage. The stators and rotors form the component parts of mono block pumps. The stators and rotors when manufactured and assembled with casing, chamber stuffing boxes, impeller, etc. are known only as mono block pump and the electric motor does not come into existence in an identifiable and separable manner.
3. The matter relates to the old Central Excise Tariff when under T.I.30 electric motor and parts of electric motors including rotors and stators were separately classifiable. There was a provision that if rotors and stators after paying duty are used in the manufacture of electric motors then set-off will be available. The respondents had already paid duty as applicable to the parts of electric motors and both the Asstt. Collector and the Collector (Appeals) had held that electric motor does not come into existence in the present case in an identifiable manner during the course of manufacture of mono block pumps.
4. This matter had also been clarified by the Ministry and these orders have been referred to by the Collector (Appeals) in his order.
5. Shri Udai Joshi, ld. Advocate had also referred to the Gujarat High Court's decision in their own case where the Hon'ble High Court had accepted the views of the petitioner before them (refer Special Civil Application 4656 of 86, decided on 7th September, 1988 at page 5} [1992 (61) E.L.T. 421 (Guj.)]. The Hon'ble High Court had observed as under :- "Rotors and Stator being parts suitable for use with electric motors would fall within Heading No. 85.03 and be liable to duty at the rate specified in Col. (4). Mr. Trivedi the ld. Advocate for the petitioners, concedes the fact that rotors and stator manufactured for use in monoblock pumps would be liable to duty under Heading No. 85.03 in view of the concluded controversy by the Tribunal's order of 5th April, 1988 rejecting the appeal of the petitioner in the first petition (reference to the Tribunal's Order No. M-159/88 dated 5-4-88 in Appeal No. B-1520/84-B1)".
6. The matter in the case of Elson Machines Pvt. Ltd. v. CCE - 1988 (38) E.L.T. 571 (S.C.) had been decided by the Supreme Court on the facts in that particular case wherein the Tribunal had rejected the appellant's contention that they had mistakenly stated that electric motors had been used for mono block pumps whereas only rotors and stators, which were integral component parts of mono block pumps, have been used. The Supreme Court observed that it was a question of fact and did not entertain the plea of the appellants before them.
7. In the particular case before us both the lower authorities had taken a view that the assessee was required to pay duty on stators and rotors under T.I. 30D of the Tariff and that the electric motor did not come into existence independently in an identifiable manner in the sense that the same was not separable easily and could not be marketed as electric motors.
8. Viewed in this light and taking all the relevant considerations into account, we find no infirmity in the view taken by the Collector (Appeals), Central Excise and as a result, the appeal filed by the Revenue is rejected.