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TMI Blog2015 (4) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... ef facts of the case are as follows: On 23.1.2000, based on intelligence, the Officers of the Department visited the premises of the appellant and examined the records. The Officers found that the appellant/assessee had been manufacturing and supplying signages (illuminated signs) under a contract with M/s.Indian Oil corporation Ltd.(in short IOC) and had erected them at the retail outlets of IOC located at various places in the South. Alleging that the appellant had undertaken manufacture of excisable goods without following central excise formalities, the Officers seized signages and parts available at the premises for further action. After taking evidence in the form of statements of various persons associated with production, inspection and purchase of signages, two show cause notices were issued to the appellant as well as to the Managing Director of the company proposing to recover central excise duty and for imposing penalty. The show cause notice was issued in the following terms: " 14. Now, therefore M/s. Virgo Industries (Engineers) Pvt. Ltd, Chennai - 600 058, are hereby required show cause to the Commissioner of Central Excise, Chennai II Commissionerate, MHU Complex, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1944. 3. I confiscate excisable goods valued Rs. 3,29,925/- under Rule 173Q(2) of Central Excise Rules, 1944/Rule 25 of Central Excise Rules, 2002. M/s.Virgo Industries (Engineers) Pvt. Ltd., Ambattur, Chennai - 58 is however given the option to redeem the confiscated goods on payment of redemption fine of Rs. 1,00,000/- (Rupees One lakh only). This option is to be exercised within 3 months from the date of receipt of this order. 4. I impose a penalty of Rs. 99,05,053/- (Rupees Ninety nine lakhs five thousand and fifty three only) under Section 11 AC Central Excise Act, 1944 on M/s.Virgo Industries (Engineers) Pvt. Ltd., No.43 Second Main Road, Ambattur Industrial Estate, Ambattur, Chennai - 58. 5. I impose a penalty of Rs. 10,00,000/- (Rupees Ten lakhs only) on Shri Mathew Kuncheria, Managing Director of M/s.Virgo Industries (Engineers) Pvt. Ltd., No.43 Second Main Road, Ambattur Industrial Estate, Ambattur, Chennai - 58. Under Rule 209A of erstwhile rules/Rule 26 of Central Excise Rules, 2002. 6. I also impose penalty of Rs. 7,00,000/- (Rupees Seven lakhs only) under Rule 173Q on M/s.Virgo Industries (Engineers) Pvt Ltd., Ambattur, Chennai - 58. 7. I also demand interest und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2000 (120) ELT 273 (SC) 5. Hyderabad Race Club, Malakpet, Hyderabad Vs. Collector of Central Excise 1986 (23) ELT 274 (Tribunal) 8. Learned Standing Counsel appearing for the Department justified the adjudication order by relying on the decision in the case of Cheran Spinners Ltd. V. Commissioner of Central Excise, Coimbatore 2008 (231) ELT 315 (Tri. - Chennai) and Commissioner of Central Excise, Chennai Vs. Aluplex India Ltd. - 2008 (228) ELT 97 (Tri. Chennai). 9. The issue that arose before the Tribunal was whether the signages erected at various petrol bunks of IOC were exigible to duty. The other factual issue that was considered by the Tribunal was whether the appellant had cleared complete signages in unassembled form to the sites or whether sign poles alone were cleared by the assessee from its factory and the remaining parts of signages got manufactured by it on job work basis were received at the respective locations directly from the contractors of Virgo for eventual erection. 10. The Tribunal, after going through the composition of signages, which includes steel structure along with electrical fittings and assembly of FRP cladding, Lexon poly carbonite ro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d from Chennai to IOC Vijayawada. This document is relied on for the purpose of showing that complete signages has been transported. The further reliance on the letter dated 27.2.1999 addressed to RITES by the Managing Director of Virgo shows that 330 signages were to be fabricated, inspected, transported and erected in an year's time. The various other documents that have been set out in the order of the Tribunal regarding the nature of transaction clearly established that full sets of signages were made ready for inspection at the premises of the appellant and inspected by the persons from IOC and RITES. 12. The Adjudicating Authority as well as the Tribunal relied upon the communication between IOC and the assessee to come to the conclusion that heavy quantity of signages were to be erected at different locations and signages of value of Rs.one crore were in stock at Ambattur and Virgonagar factories. 13. To buttress the argument that erection was not done at the site, reliance was placed on the work order placed on M/s.Venkateswara Fibre Glass Industries dated 25.11.1999 and 25.1.2000, wherein it was stated that free delivery may be given at out works at Chennai - 58. All ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anspires from the ratio of the above case law that an item which is fixed in the earth can continue to be movable and excisable if the same is capable of being shifted from one place to another without having to dismantle the same into the constituent components. We have seen the photographs produced by Virgo showing different stages of assembly and erection of signages. Undisputedly signages are capable of being assembled at the premises of the appellants and then transferred to the site to its erection after dismantling the same. The signages do not emerge as an immovable property on assembly or erection. They have base plates of steel with provision to fit them on bolts of the concrete foundation. These are not like a turbo alternator, parts of which are separately aligned and fixed on a concrete base to bring into existence the turbo alternator and could not be removed as turbo alternator as such. In the circumstances we hold that the signages are excisable goods." 17. To further buttress the finding that erection is of no consequence, it has been held in paragraph 11 of the order of the Tribunal that no separate charges are realized for erection and commissioning as seen from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the present case are different. Here, the findings of the Commissioner as well as the Tribunal are that the signages are capable of movable and are installed by fixing it on a concrete foundation and can be detached and shifted to another location without damaging them. Therefore, the above-said decision of the Supreme Court stands distinguished in the facts of the present case. Even otherwise, we find that the finding of fact by the Commissioner as well as by the Tribunal cannot be an issue for consideration in appeal. We find that the first question of law is a question of fact and on the second question of law whether the Board's Circular is binding, reliance was placed on the Board's Circular No.58/1/2002-CX dated 15.1.2002 by the counsel for the appellant, wherein it is stated as follows: "(vii) When the final product is considered as immovable and hence not excisable goods, the same product in CKD or unassembled form will also not be dutiable as a whole by applying Rule 2(a) of the Rules of Interpretation of the Central Excise Tariff. However, components, inputs and parts which are specified excisable products will remain dutiable as such identifiable goods at the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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