2005 (8) TMI 469 - AT - Central Excise

Summary

Issues:
Excisability of "Bucket Wheel Reclaimer" under Chapter sub-heading 8428.90 of the Central Excise Tariff Act, 1985.

Analysis:
The judgment involves two appeals challenging Order-in-Original No. 54/2003 passed by the Commissioner of Central Excise, Viskhapatnam. The main issue revolves around the excisability of the "Bucket Wheel Reclaimer" (BWR) under Chapter sub-heading 8428.90 of the Central Excise Tariff Act, 1985. The adjudicating authority confirmed a duty demand against the appellant and imposed penalties under various sections of the Central Excise Act, 1944. The appellants contested the order, arguing that the BWR is not excisable as it is immovable and location-specific. The Commissioner based the duty demand on the view that the BWR is not permanently fixed and relied on a previous Supreme Court judgment. The appellants maintained that the BWR was tailor-made for a specific location at the Vizag Port Trust site and was not marketable or reusable elsewhere. They argued that they had paid excise duty for individual components and had no intention to evade duty. The Tribunal examined the specifications and usage of the BWR, concluding that it is immovable, location-specific, and not excisable. The Tribunal also found no justification for imposing penalties on the appellants, ultimately allowing the appeal with consequential relief.

In the detailed analysis, the Tribunal considered the specific characteristics of the BWR, such as its design, assembly, and usage at the Vizag Port Trust site. The appellants' argument that the BWR is immovable and not marketable due to its unique specifications and limited movability on a specific track was deemed valid. The Tribunal emphasized that the BWR was not intended for use in other locations and had been designed and assembled for a specific purpose at the Vizag Port Trust site. The Tribunal's decision was influenced by the fact that the components of the BWR had already discharged excise duty obligations, further supporting the immovable nature of the equipment. Additionally, the Tribunal found that the Revenue had not proven that the BWR was marketable or reusable, leading to the conclusion that it is not excisable. Consequently, the Tribunal ruled in favor of the appellants, holding that the BWR is immovable and not subject to excise duty, and no penalty should be imposed on the appellants based on their bona fide belief regarding the excisability of the equipment.