TMI Blog1998 (5) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... lectrosmelts Ltd. is Rs. 13,08,339.15 and the classification proposition is under 8514.00. The parties have taken identical stand and the same citations were given and it was represented by Shri P. Thomas, Consultant before the Commissioner (Appeals). Before us, Shri P. Thomas appeared in the case of M/s. Silical Metallurgic Ltd., while in the case of Indsil Electrosmelts Ltd. Shri D. Sankaran, Advocate appeared. In the case of M/s. Indsil Electrosmelts Ltd., it was contended that the Electric Arc Furnace was constructed at their site procured all the component parts required from local market as well as the factories of production which has discharged their duty liabilities, at the time of the clearances from the factories of their production. It was contended that the construction and installation of the above Electric Arc Furnace which is a turn-key project and the construction and installation at site piece by piece had been carried out for a long period of time and finally the resultant plant which is fixed to the ground with railing arrangement and wheel base for very slow rotation, not intended to be moved therefrom had become an immovable property, thereby not attracting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce as per the requirements. They have supplied the requisite raw materials to the job workers and the transportation cost of the materials were borne by them. The final process viz. the assembling of various items was done at the premises of M/s. Indsil Electrosmelts Ltd. by themselves. (c) As noted earlier, the Commissioner (Appeals) noted the same contentions and passed an identical order in the case of M/s. Silical Metallurgic Ltd., whose facts and details are noted in succeeding paragraphs. 2. In the case of M/s. Silical Metallurgic Ltd., the appeal arises from Order-in-Appeal No. 106/96(C), dated 14-3-1996, wherein the Commissioner (Appeals) held that Electrical Furnace goods are not immovable property and that they have been rightly classified under sub-heading 7202.00 of Central Excise Tariff Act. The brief facts of the case are that the appellants are manufacturers of Ferro Silicon and other Ferro alloys falling under sub-heading 8514.00 of Central Excise Tariff Act, 1985. They manufactures Electric Arc Furnace without obtaining licence from the department, without filing the classification list and without maintaining statutory records besides submitting returns and pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd it has to be assembled on civil work having a depth of 15 feet. The furnace so assembled consists of (a) central pillar bolted to the foundation embedded to the earth by civil work at a depth of 15 feet, (b) the axis on which the furnace with rotation mechansim and the wheels and rail arrangements etc. and (c) the furnace constructed brick by brick in a steel shell and rammed with carbon paste. The foundation is bolted and all of this forms an integral part of the special type of furnace. He has also noted their plea that once it is constructed, it becomes a part of immovable property since it cannot be dis-assembled and erected at another place since dismantling would result in recovery of only certain component parts but the most expensive parts namely refractory bricks, tamping paste etc. would be destroyed and would result only in scrap. The learned Commissioner (Appeals) rejected the plea on the premise that it is not in the nature of lift which becomes an integral part of the building in which it is installed. He observed that this is more in the nature of manufacturing machinery which is erected on deep foundation on account of its size and weight and for the purpose of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reful consideration of the submissions it is clear that this Furnace had not been manufactured in any factory in an assembled form and taken to the site for erection. As can be seen from the facts which are not disputed, the Electric Arc Furnace had been constructed and installed at site and it consists of (i) central pillar bolted to the foundation embedded to the earth by civil works at a depth of 15 feet, (ii) the axis on which the furnace with rotation mechansim and the wheels and rail arrangements etc. and (iii) the furnace constructed brick by brick in a steel shell and rammed 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 found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . `Goods were not defined in the Act. The meaning, as found by the Court from dictionaries, showed that to become `goods an article must be something which can ordinarily come to the market to be bought and sold . In Bhor Industries Ltd., Bombay v. Collector of Central Excise, Bombay, 1989 (40) E.L.T. 280 (SC) = 1989 (1) S.C.C. 602, the view taken in the case of Delhi Cloth and General Mills Co. Ltd. and reiterated in South Bihar Sugar Mills Ltd. etc. v. Union of India Ors., 1978 (2) E.L.T. (J 336) (SC) = 1963 (3) S.C.R. 21, and Union Carbide India Ltd. v. Union of India, 1986 (24) E.L.T. 169 (SC) = 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 (SC) = 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 consumer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt s case that it was liable only for a component part and not the end product was, therefore, rejected. 8. Learned counsel for the Revenue submitted that if even a weighbridge was excisable, as held in the case of Narne Tulaman Manufacturers Pvt. Ltd., so was a mono vertical crystalliser. The only argument on behalf of Narne Tulaman Manufacturers Pvt. Ltd. was that it was liable to excise duty in respect of the indicating system that it manufactured and not the whole weighbridge. The contention that weighbridges were not `goods within the meaning of the Act was not 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o evidence in that regard was brought on record. The Court further observed that Narne Tulaman Manufacturers judgment did not lay down that the weighbridges were excisable goods. 7. In the case of M/s. Quality Steel Tubes (P) Ltd. v. C.C.E. reported in 1995 (75) E.L.T. 17 (S.C.) the Hon ble Supreme Court held that plant and machinery embedded to earth, structures, erections and installations are not excisable goods, since they do not pass the twin test of being capable of being brought to the market. The Supreme Court noted several judgments and observed that the basic test 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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