2005 (7) TMI 416 - AT - Central Excise

Summary

Issues:
Challenge to correctness of Order-in-Appeal dropping duty demand and penalty against respondents.

Analysis:
The appeal before the Appellate Tribunal challenges the Order-in-Appeal where the Commissioner (Appeals) had dropped the duty demand and penalty against the respondents. The respondents, under an agreement with M/s. NBCC, undertook manufacturing, erection, and commissioning of a system at Delhi Airport. The adjudicating authority confirmed duty demand and penalties, which the Commissioner (Appeals) reversed based on a circular stating the goods had no marketability. However, the Tribunal found fault with this decision, citing precedents where similar activities were held to be excisable. The Tribunal noted that marketability does not require widespread trade but can exist even with a single buyer. The Commissioner (Appeals) was criticized for not considering the terms of the agreement to determine the nature of the activity and goods produced. The Tribunal emphasized the need for a thorough examination before concluding on marketability.

The respondents referred to an earlier Tribunal decision in their cross-objections, but failed to demonstrate the similarity of facts and agreements between the cases. The Tribunal reviewed the previous order but found the necessary contracts were not provided by the respondents. Consequently, the Tribunal concluded that the matter should be re-examined by the Commissioner (Appeals) for a fresh decision after hearing both sides. The impugned order was set aside, and the case was remanded to the Commissioner (Appeals) for further consideration. The appeal of the Revenue was allowed by way of remand, emphasizing the need for a comprehensive review of the case.