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TMI Blog2002 (1) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... onal hearing. Noticee No. 1 M/s. Cethar Vessels Ltd. Tiruchirapalli are15. engaged in the manufacture Boilers and parts/components thereof covered under sub-headings 8402.10 and 8402.90 respectively. Noticee had entered into contract with Noticee No. 2, M/s. Bridgestone ACC Ltd., Pithampur for supply of two boilers. The Noticee No. 1 have manufactured and supplied some parts of the boiler while some other parts essential for the purposes of Boilers were procured from the other suppliers. The various components procured and received at the site of Noticee No. 2 from two sources as discussed above were assembled/erected at the premises of Noticee No. 2. This work of erection/installation and commissioning was also completed by the Noticee No. 1. The allegation in the show cause notice is that the various components following their assembly/erection has resulted into a Boiler of Chapter Heading 8402.10 which is different from the components that have gone into the assembly. Therefore show cause notice under consideration proposes recovery of duty on the boiler manufactured by the Noticee No. 1 at the site of Noticee No. 2. Noticee No. 1 submitted that they undertake contracts for16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Combustion Boilers) can also work on other Fuels though designed for fuels like agricultural or municipal waste. It was submitted by them that FBCBS are generally cleared in unassembled or disassembled condition by following any or all of the procedures as indicated below :- (a) Supply pressure parts like boiler drum/shell, furnace, economiser, super heater, fluidised bed combustion system comprising of in bed tubes, air box, fluidising air nozzle, fuel feed nozzle, feed line etc. from the factory of the manufacturer. (b) Supply standard bought out items like pumps, fans, motors, valves, cables etc. direct to site from vendors or receive the same at the stores and send it along with the manufactured components to site. (c) Structural which act as support for mounting pressure parts and ducting which act as an enclosure to convey the fuel gas from one heat recovery area to the other, manufactured by sub-contractors and dispatched along with the factory manufactured components to site or direct to the sub- contractors to send these items to site directly o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fferent from the components that has gone into its production and it is covered under Heading 8402.10 of the Central Excise Tariff Act, 1985. The assessment of goods cleared from the factory of Noticee No. 1 was in respect of components of boiler while present show cause notice speaks about assessment and demand of duty in respect boiler it self, which are different from each other. Therefore contention of the noticee that when assessment under Heading 8402 when goods had left their factory, there cannot again assessment under same heading is not correct. Noticee referring to various decisions has also submitted19. that what emerges at site i.e. boiler is not goods inasmuch as it is immovable and incapable of being marketed and therefore not excisable goods. In this connection, I find that Hon'ble Supreme Court in case of Triveni Engineering & Ind. Ltd. v. CCE - 2000 (120) E.L.T. 273, has clearly observed that mobility and marketability has to be ascertained from the facts and circumstances of each case. In the present case Shri Clement V. Sammnat site Engineer of Noticee No. 1, who had supervised erection installation of boiler in his statement dtd. 25-2-98 recorded under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 2 have dealt in goods which are liable for confiscation, therefore Noticee No. 2 also deserve for penal action under Rule 209A of the Central Excise Rules, 1944. Noticee No. 3 Deputy Manager, Excise is handling the work of Noticee No. 1 related to excise matter. He had asked in manner if furtherance of the act of Noticee No. 1, is not discharging the duty on boiler, which is liable for confiscation. Therefore, Noticee No. 3 also deserves for penal action under Rule 209A of the Central Excise Rules, 1944." 2.Arguing for the appellants ld. Counsel Shri R. Raghavan and J. Shankarraman submit that they have taken a time to file appeal before this Bench in view of the fact that one of the appellants, i.e. Cethar Vessels Ltd. is located at Trichy. They contend that Cethar Vessels Ltd. had obtained contract for supplying in CKD/SKD condition boilers to Bridgestone ACC India Ltd. and for erection of the boilers at their premises at Indore. They had cleared the same on payment of duty by classifying the components of the boiler and parts/components thereof under sub-headings 8702.10 and 8402.90 respectively. The statement of the Site Engineer Shri Clement V. Samuel on 25-3-98 has clearl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount to manufacture as no marketable commodity having come into existence, therefore being an immovable property, it is not marketable and the same cannot be subject to excise duty. Ld. Advocate submits that the issue was gone into in great detail by the Apex Court in the case of Triveni Engineering & Industries Ltd. v. CCE [2000 (120) E.L.T. 273 (S.C.)], it has been laid down that the item on construction should also be movable and marketable and only then, it can be considered as excisable. He contends that the boiler which came into existence was as an immovable property and it loses marketability as it is no longer movable, hence the judgment of the Apex Court in the case of Triveni Engineering & Industries Ltd. clearly applies and is not distinguishable. He submits that the Tribunal in the case of Silical Metallurgic Ltd. v. CCE, Cochin [1999 (106) E.L.T. 439] went into the question of erection of electric arc furnace constructed and installed at site and held that the said furnace is an immovable property and incapable of being brought to the market for being bought and sold, hence it cannot be treated as excisable product. 4.Ld. Advocate points out to the papers filed by SD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluding its accessories on payment of duty. Ld SDR has filed today before the Bench copies of invoices pertaining to the clearances made by Cethar Vessels to Bridgestone ACC India Ltd. for erection of boilers. The description in the invoices clearly discloses that "supply of 7 TPH boiler - 1 No. 1750.00 Kgs. and valued at Rs. 2,03,715.76 and rate of duty has been shown as 18%. Further excise invoices have also been filed with regard to the supply of structurals and the details of its weight, value and percentage of duty have also been shown. From the above, the duty paying nature of the boilers sent in SKD/CKD condition is, therefore, not disputed. (b) The fact that the Bridgestone India had placed orders on Cethar Vessels Ltd. for erection of boilers at the site is an admitted position and based on these facts the proceedings have been initiated. (c) It is also not disputed that Board has issued a Circular under Section 37B, particularly for Cethar Vessels only. (d) The question, therefore, is as to whether the erection of boilers at site has brought in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmed with carbon paste. The foundation, the bolting arrangements to the foundation, the railings as well as the wheels form integral parts of the sub-merged Electrical Arc Furnace. It is strongly contended that the bricks are laid like a Kiln, brick by brick in a steel shell and rammed with carbon paste and the entire mass is baked by burning and heating for 20 days. It is seen that these facts and the manner in which the Furnace has come into existence has not been disputed by the lower authorities. The construction of the Electric Arc Furnace has taken place simultaneously with the civil work and the foundation has not acted as a base for laying the machinery. The observation of the Commissioner (Appeals) that the foundation has been laid for the purpose of erecting the furnace is not in terms with the facts pleaded by the appellants. He has observed that similar furnace has made by M/s. A.B.B. Ltd. and M/s. Inductotherms (I) Ltd. This aspect of the matter has not been put to the appellants nor there is any evidence that the furnace has come into existence of goods in another factory and being erected in another factory. The facts disclosed that the item has come into existence a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a, 1986 (24) E.L.T. 169 (S.C.) = 1986 (2) S.C.C. 547, was applied to crude PVC films. It was held that they "were not known in the market and could not be sold in the market and was not capable of being marketable". In Indian Cable Company Ltd., Calcutta v. Collector of Central Excise, Calcutta and Ors., 1994 (74) E.L.T. 22 (S.C.) = 1994 (6) S.C.C. 610, this Court considered the question of PVC compounds, and observed that marketability was a decisive test for dutiability. It meant that the goods were saleable or suitable for sale. They need not in fact be marketed. They should be capable "of being sold to consumers in the market, as it is without anything more". The case that comes closest to that which we have before us is the case of Quality Steel Tubes (P) Ltd. v. Collector of Central Excise, U.P., 1995 (75) E.L.T. 17 (S.C.) = 1995 (2) S.C.C. 372. The issue was whether "the tube mill and welding head erected and installed by the appellant for manufacture of tubes and pipes out of duty-paid raw material" was assessable to excise duty. The Court observed, having regard to the earlier decisions aforementioned, "The basic test, therefore, of levying duty under the Act is two-fold. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised and no evidence in that behalf was brought on record. We cannot assume that weighbridges stand on the same footing as mono vertical crystallisers in that regard and hold that because weighbridges were held to be exigible to excise duty so must mono vertical crystallisers. A decision cannot be relied upon in support of a proposition that it did not decide. 9. Upon the material placed upon record and referred to above, we are in no doubt that the mono vertical crystalliser has to be assembled, erected and attached to the earth by a foundation at the site of the sugar factory. It is not capable of being sold as it is, without anything more. As was stated by this Court in the case of Quality Steel Tubes (P) Ltd., the erection and installation of a plant is not excisable. To so hold would, impermissibly, bring into the net of excise duty all manner of plants and installations. 10. The Tribunal took an unreasonable view of the evidence. It. was the case of the appellants, not disputed by the Revenue, that mono vertical crystallisers were delivered to the customers in a knocked down condition and had to be assembled and erected at the customers' factory. Such assembly and erecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of levying duty under the Act was two fold. One, that any article must be goods and second, that it should be marketable or capable of being brought to the market. Goods which are attached to the earth and thus become immovable do not satisfy the test of being goods within the meaning of the Act nor it can be said to be capable of being brought to the market for being bought and sold. Therefore, the Hon'ble Supreme Court held that both the tests were not satisfied in the case of appellant as the tube mill or welding head having been erected and installed in the premises and embedded to earth they ceased to the goods within the meaning of Section 3 of the Act. Observing the contention of the learned Counsel for the Revenue that even if the goods were capable of being brought to the market it would attract levy, the Hon'ble Supreme Court observed that "True, but erection and installation of a plant cannot be held to be excisable goods. If such wide meaning is assigned, it would result in bringing in its ambit structures, erections and installations. That surely would not be in consonance with accepted meaning of excisable goods and its exigibility to duty." 8. Even in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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