1999 (4) TMI 310 - AT - Central Excise

Summary

Issues: Application for waiver of deposit of duty and penalty on goods classified under Heading 84.80, financial hardship plea, movable nature of goods, classification of goods under Heading 73.08, confirmation of order by Ostlandske Spennbetong A.S, applicant's status post-1995-96, requirement for deposit.

In this case, the applicant sought a waiver of duty deposit amounting to approximately Rs. 25.01 lakhs and a penalty deposit of Rs. 2 lakhs on the firm and Rs. 1 lakh on its sole proprietor. The advocate argued that the goods, classified under Heading 84.80 by the department, were not marketable as they were specifically fabricated for bridge construction, citing the Karnataka High Court judgment in Thungabhadra Steel Products Ltd. v. Union of India. Additionally, it was contended that the goods should be classified under Heading 73.08 instead, benefiting from Notification No. 61/90 due to being fabricated on-site. Financial hardship was highlighted, supported by the closure of the applicant's business in 1996 and the production of income tax returns for the assessment year 1995-96.

The departmental representative disputed the movability of the goods, pointing out provisions for sales tax and octroi in the contract as indicators of movability. The Commissioner found that the goods were manufactured in a knock-down condition, thus disqualifying them from benefitting under Notification 61/90. Moreover, concerns were raised regarding the lack of evidence regarding the applicant's status post-1995-96. The classification of the goods under Heading 84.80 was deemed doubtful, with indications that they might fall under Heading 84.79 due to the complex machinery involved in their construction and operation. The applicant was directed to deposit Rs. 8 lakhs within two months, after which the remaining duty and penalty deposits would be waived, and their recovery stayed.

In conclusion, the Tribunal's decision balanced the arguments presented by both parties, considering the nature of the goods, their classification, and the financial circumstances of the applicant. The requirement for the deposit was based on the prima facie assessment of the situation, pending further examination of the classification and movability of the goods.