2010 (8) TMI 315 - AT - Central Excise

Waiver of pre-deposit Excisability Weighbridges as immovable property - Merely because civil work was required to be arranged by the purchaser in relation to the concrete platform, that itself would not make the product an immovable property nor it could justify the claim of the applicants that the product does not amount to an excisable one applicants contended that weighbridge would cease to be excisable goods on the ground that it becomes an immovable property once it is attached to the earth - demanded of duty to deposited - interest and penalty waived till the disposal of the appeals

Issues Involved:
1. Stay of the order dated 8th September, 2009.
2. Classification of weighbridges as movable or immovable property.
3. Financial hardship due to the demand.
4. Justification for invocation of the extended period of limitation.

Issue-wise Detailed Analysis:

1. Stay of the order dated 8th September, 2009:
The applicants sought to stay the order confirming a demand for duty amounting to Rs. 1,71,40,806/- with interest and penalties. The applicants argued that similar issues had been decided in their favor in previous cases by the Tribunal, referencing decisions such as Ash Bee System (P) Ltd. v. CCE, Chandigarh-II, and Commissioner of Central Excise, Guntur v. Ashbee Systems (P) Ltd. They contended that their goods were neither movable property nor marketable, thus not justifying the levy of excise duty. However, the Department contended, based on Supreme Court decisions like Narne Tulaman Manufacturers Pvt. Ltd. v. Collector of Central Excise and Sirpur Paper Mills Ltd. v. CCE, Hyderabad, that the product being supplied in disassembled form and fixed to the ground did not make it immovable property.

2. Classification of weighbridges as movable or immovable property:
The applicants described the process of assembling weighbridges at the customer's site, arguing that the system becomes a fixture and immovable structure. However, the Tribunal referenced the Supreme Court ruling in Sirpur Paper Mills Ltd., which stated that machinery attached to earth for operational efficiency does not transform into immovable property. The Commissioner found that the weighbridges, even when supplied in disassembled form and attached to the earth with nuts and bolts, remained movable and marketable. The Tribunal agreed, noting that the involvement of the customer in civil work did not change the nature of the product.

3. Financial hardship due to the demand:
The applicants claimed financial hardship, citing a profit of Rs. 2,48,550.37 after taxation. The Tribunal found this insufficient to demonstrate financial hardship, noting that the profit & loss account was filed in a truncated form and did not provide a complete picture of the financial condition. The Tribunal emphasized that the financial condition of the firm could not be determined solely based on the previous year's profit & loss account.

4. Justification for invocation of the extended period of limitation:
The applicants argued against the invocation of the extended period of limitation, but the Commissioner found that the applicants had suppressed facts about their clearances with the intention to evade duty. The Commissioner noted that the applicants had full knowledge of their actions and had submitted declarations that did not reflect the true nature of their clearances. The Tribunal agreed with this finding, stating that no other view was warranted at this stage.

Conclusion:
The Tribunal did not find a prima facie case for a total waiver of the amount demanded. They directed the applicants to deposit the duty amount within ten weeks, waiving the interest and penalty amounts until the disposal of the appeals. The case was scheduled for reporting compliance on 6th December, 2010.

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