9911796707
TMI Blog1996 (12) TMI 196X X X X Extracts X X X X X X X X Extracts X X X X ..... r which they were licensed during the relevant period. During the period August 1988 to December 1989, the appellant fabricated and erected two conveyer systems in their factory for the extension of the already existing plant and machinery. It is this conveyer system for transmission of crates of bottles which is the subject matter of dispute before us. Whereas it is the Revenue s case that the said conveyer system falls under sub-heading No. 8428.00 of the Central Excise Tariff Act, 1985 and assessable to duty, the appellants contention is that the same is outside the scope of Central Excise law being immovable property as the same is embedded to earth. A show cause notice dated 8-6-1992 was issued to the appellants alleging that they had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n principle Collector has observed correctly but he has not applied the same law to the facts and circumstances of the instant case correctly. He also submitted that the two decisions of the Hon ble Madras High Court relied upon by the Collector were considered by the Hon ble Supreme Court and were found to be not applicable in respect of the goods which are erected at the first instance by being embedded to the earth itself. He also submitted that the Hon ble Supreme Court while considered these two decisions in the case of Municipal Corpn. of Greater Bombay and Others v. Indian Oil Corpn. Ltd. - 1991 Supp. (2) SCC 18 has laid down the test under which circumstances the goods attached to the earth can be held to be immovable goods. He also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion was not favoured with by the apex court. In the circumstances he submitted that the conveyer system in question may be held to be immovable property and their appeal be allowed. Learned Advocate also argued on the limitation aspect and the question of imposition of penalty. 3. Appearing on behalf of the Revenue, learned SDR Shri M. Jayaraman drew attention of the bench to the statement of Shri Harbans Singh and submitted that the said Shri Harbans Singh has clearly admitted that they have assembled and erected a conveyer system in their factory. This means that the conveyer was first manufactured and then installed in the factory and same has been attached to earth so as to avoid the vibrations in the working of the same. He also reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods case on merits. The process of erection of the said conveyer system as given by them in their reply dated 16-10-1993 to the Collector of Central Excise, Chandigarh which has not been disputed by the adjudicating authority is as follows : The process of installation may briefly be explained like this that first of all the driver unit and the driven unit is grouted at both ends. This results in fixing these units permanently to the earth. Thereafter stands are placed in between both ends at required distances. Then channels are placed on these stands for driving the mechanical chain. Thereafter Gear Box and Electric Motors are grouted and then connected with the driving unit to put the mechanical positive drive conveyer system in worki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. v. CCE. The last cited case i.e. 1990 (46) E.L.T. 562 (Tribunal) directly dealt with the issue of dutiability of Conveyer Belt System as per discussion in para 5.2 thereof. In view of the foregoing the activity undertaken by the noticee cannot be held liable to duty as proposed in the show cause notice. 3. The Hon ble Supreme Court has held in series of cases that the test of marketability be also satisfied before duty is levied on an article. In the instant case the Conveyer Belt System had been designed to work in specific factory location. It would have no value for other manufacturers. It does not satisfy the test of marketability. The judgment of the Hon ble Supreme Court in the case of BHOR Indust. reported in 1989 (40) E.L.T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roposed proceedings be ordered to be dropped. The noticee party request that an opportunity of personal hearing in the matter may please be afforded to them." 6. From the above we find that first the driven unit and the driver units are grouted to the earth at the requisite place and the stands are embedded to earth with equal distance in between them. Subsequently the system is erected on these stands and the driven units. We have also looked into the photos of the system and the process of erection of system as explained by the learned Advocate. The two decisions of Madras High Court in the case reported in AIR 1940 Madras 527 and in the case reported in AIR 69 Madras 346 have been taken note of by the Hon ble Supreme Court in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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