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2007 (4) TMI 484 - AT - Central Excise
Issues involved: Determination of dutiability of tanks manufactured for IOCL and BPCL, applicability of duty, interpretation of excisability of plant and machinery assembled on site.
Issue 1: Dutiability of tanks manufactured for IOCL and BPCL The Appellant appealed against the order-in-appeal upholding duty on tanks manufactured for IOCL and BPCL. The Appellate Authority relied on a statement from a partner of the Appellant firm, concluding that tanks installed below the ground were not immovable property and thus dutiable. Issue 2: Interpretation of excisability of plant and machinery assembled on site The Appellant's consultant argued that tanks fabricated for IOCL and BPCL were immovable as they were attached to the earth from the beginning and not removable without dismantling. Citing relevant decisions, the consultant contended that the tanks should not be considered marketable goods and therefore not dutiable. Judgment Details: The Tribunal examined the materials before it, including purchase orders and statements, to determine the nature of the tanks. It was established that higher capacity tanks were fixed to the earth from the start of fabrication and were not removable. The Tribunal referred to Supreme Court decisions and a CBEC circular to assess the excisability of such assembled items. Applying the permanency test laid down by the Supreme Court, the Tribunal concluded that the tanks, being immovable and not marketable goods, were not liable to duty. The Tribunal emphasized the twin test for excisability, stating that goods attached to the earth and not capable of being brought to market are not dutiable. The judgment allowed the appeal, remanding the matter for reassessment while ensuring the Appellant's right to present evidence and claim SSI exemption. This judgment clarifies the distinction between movable and immovable property for excisability purposes and underscores the importance of marketability in determining dutiability under the Central Excise Act, 1944.
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