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TMI Blog2001 (2) TMI 527X X X X Extracts X X X X X X X X Extracts X X X X ..... ng issues : (i) Duty demanded by seeking to include Notional interest on advances in Assessable value (Para 4.3 at pages 57 to 62 of the Order) ......... Rs. 64, 72,486.45 (ii) Duty demanded on the profit allegedly made in trading goods bought and sold as such without even bringing the same to the factory by including such profit in assessable value of goods manufactured at the appellant's factory (Para 4.2.7 at pages 63 to 66 of the Order) ........ Rs. 1,58,41,467.84 (iii) Duty demanded by changing approved classification of machinery and equipments cleared in knocked down condition and holding the same to be only parts or individual items (Para 4.2.1 to 4.2.16.3 at pages 30 to 57 of the Order) ......... Rs. 23,41,089.79 Rs. 2,46,55,044.08 3. We have heard Shri S.K. Bagaria, learned Advocate against the impugned order and Shri V.K. Chaturvedi, learned SDR, for the Revenue. 4. As regards the first issue that is confirmation of demand of duty by enhancing the assessable value on account of inclusion of notional interest on advances received by the appellants from their customer, Shri S.K. Bagaria, learned Advocate, submits that the said adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this count by the adjudicating authority is not justified and is required to be set aside. We order accordingly. 6. As regards the demand of duty on the profit allegedly made by the appellants in trading of the goods bought and sold by them, it is seen that the appellants are executor of large turnkey projects. For the said purpose they manufacture several machinery and equipment in their own factory and dispatched the same to the site of the buyers on payment of duty. Some of the equipments and accessories are also purchased by them from other manufacturer and are dispatched directly to the site of their buyers. They are mentioning agreed price of different individual machines and equipments and accessories in the billing schedule, which are approved by their buyers. The appellant's contention is that the conclusion arrived at by the adjudicating authority that they have suppressed the assessable value of their own manufactured goods by correspondingly increasing the bill value of the traded goods are not based upon the appreciation of all the evidences placed by the appellants on record and are erroneous in nature. According to the appellants, they have filed the statement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken into consideration by the adjudicating authority. If the appellants are earning profit on their shop manufactured items and if the contracted price is being charged from their customer, we agree with the appellants that there is no scope for adding the earnings made on the traded items in the assessable value of the shop manufactured goods. With this observation, we set aside that portion of the order relatable to the said issue and remit the matter to the Commissioner for de novo adjudication in the light of the observations made by us. 8. As regards the third issue, it is seen that the demand of duty has been confirmed by the adjudicating authority on the ground that the appellants have manufactured some of the parts and equipments in their factory and have bought out other items from other manufacturers and as such, it is not complete system which is required to be assessed to duty as a complete machine but the separate parts manufactured by the appellants are to be classified as parts and assessed to duty accordingly. Accordingly by holding that the goods supplied by the appellants are not to be assessed to duty as complete machine but as machine parts, he has conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attained the essential character of complete machine. Such items would therefore be classified under the Chapter Heading/sub-heading under which the complete machine is classifiable. However, if the items manufactured and cleared by the assessee do not satisfy the above condition, then the same has to be classified separately as parts under respective chapter heading/sub-heading. Moreover, the unassembled items which are in excess of number required for constituting a complete machine or an incomplete machine having the essential characteristics of a complete machine, even if cleared alone with the complete machine or the incomplete machine in CKD have been classified independently as parts under respective Chapter heading/sub-heading." 9. After observing as above he has proceeded to discuss and examine each of the contracts entered into between the appellants and their buyers. On the other hand, the appellant's contention is that the contract with their buyers was for the supply of a complete machine. Irrespective of the fact that whether some of the machines have been manufactured in their own factory and some others have been procured from outside, it will be the complete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng authority that in some of the cases, parts required for constituting complete machine are in excess of the number required for that machine, in which case it has to be held that it is the parts and not the complete machine cleared from the factory. 11. Inasmuch as the number of purchase orders are involved in the present appeal, we direct the Commissioner to look into each one of them in the light of the observations made by us in the preceding paragraph. Accordingly we set aside this portion of the Order and remit the matter to the Commissioner for de novo adjudication. 12. As regards the personal penalty and confirmation of interest under the provisions of Section 11AC and Section 11AB we find that the period involved in the present appeal is prior to 28-9-1996, when the said Sections came into existence. It is no more res integra that the said Sections are not retrospective in nature and cannot be pressed into service in respect of demands for the period prior to 28-9-96. Following case law referred to by the learned Advocate is relevant - (i) 1998 (102) E.L.T. 705 (Tribunal) = 1998 (25) RLT 919 - Marcandy Prasad Radhakrishna Prasad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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