Customs, Excise and Gold Tribunal - Mumbai
Silson India Pvt. Ltd. vs Commissioner Of Central Excise on 7 July, 2005
ORDER S.S. Sekhon, Member (T)
1. Appellants are an assessee who manufacture and supply Boilers and parts of Boilers and parts of soot blowers used in repairs and maintenance of Boiler. They had paid duty on boilers cleared in knocked down condition and in some case, certain accessories were directly supplied as bought out items at site. Value of such bought out items at site was not added. Similarly no duty was paid on erection and commissioning charges of boilers. When such boilers were cleared in knocked down condition. On parts claimed duty was paid and assessee availed Modvat credit on inputs.
2.1 (a) Revenue, by issue of a notice dt. 22-6-94 demanded duty on Value of parts supplied directly to site and erection and commissioning charges.
(b) Denial of credit on motors etc. used in repair of boilers.
(c) Penal action proposal.
2.2 CCE (Appeals) remanded the issue as regard Modvat charge to the Additional Commissioner and confirmed the duty demands on the grounds that no evidence was shown that Boilers had emerged as immovable property without arriving at a finding, on the valuation charges in the notice and imposed a penalty. Hence this appeal.
2.3 The order of demand of duty on Boiler emerging outside the jurisdiction and the factory premises of the assessee and at premises of the customers viz. M/s. Yeshwant Sahakari Sakher Karkhane Ltd. & M/s. Belganga SSK Ltd. which are beyond the jurisdiction by the Additional Commissioner. The demand of duty cannot be upheld. Moreover in proceeding in that view the Additional Commissioner travelled beyond the notice which was on valuation. The orders are therefore to be set aside.
2.4 The issue of erection and commissioning charges cannot be included when Boilers are being removed in knocked down condition i.e. parts and there being no separate entry for parts in the Tariff at that time, following the Supreme Court decision in case of Thermax Ltd. .
2.5 Similarly, when there is no evidence of a full Boiler having come into existence in the factory of the assessee and then being removed in SKD or CKD state, as certain parts were directly procured and supplied to site, assessment of the removers has to be as Boiler in SKD/CKD parts and not as Boiler and value of bought out items cannot be included.
3.1 In view of the findings, no duty demands can be upheld. The penalty as arrived therefore cannot be sustained.
3.2 Order impugned is to be set aside and appeal allowed, as regards Boiler valuation and penalty only.
3.3 Ordered accordingly and appeal disposed.
(Pronounced in Court)