TMI Blog1994 (5) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... fter under Ch. 84 of Schedule to the Central Excise Tariff Act, 1985. It was also revealed by the intelligence that the turnover of the party was quite high but the party was not paying any Central Excise duty. Acting upon the intelligence, the officers of this Collectorate visited the factory of the party at the address mentioned above and also head office situated at 3785, Subhash Marg, Daryaganj, Delhi on 18-9-1987. No records were found/recovered in the factory. Sh. Anil Kumar, Supervisor, who was present in the factory, tendering a statement on the spot explained that the records were kept in head office and at the time of clearance, the Manager used to visit the factory from the head office and issued the necessary documents. He als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 2-11-1987 but that list did not give the requisite details. As whole of the supplies are through DGS D information relating to the acceptance of tenders, inspection notes giving dates of despatches etc., goods supplied and bills raised was called for from the C.C.A. Dept. of Supply, DGS D. On scrutiny of Acceptance of Tenders , awarded to the party by/through the DGS D, details of the items which were depicted therein, under specifica-tion Technical date, to be of Western make, were worked out and on taking the value of those items from the bills raised by the party on DGS D, the value of clearances from the factory of the party was computed and found as under :- Financial Year Value of clearances (in Rs.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exceeded Rs. 2.5. lacs. Notification No. 65/83 dated 1-3-1983 had also been issued to exempt the goods in question upto the value of first clearances of Rs. 15 lacs from the Central Excise duty in excess of 50% of effective rate. These provisions vide these two notifications remained effective til l the financial year of 1986-87 as they were vide Notification No. 75/87 dated 1-3-1987, the exemption from whole of duty to goods in question was extended upto the value of first clearances of Rs. 5 lacs and the value of clearances of Rs. 10 lacs in excess of first 5 lacs was exempted to the extent of 40% of effective rate of duty. Exemption contained in Notification No. 75/87, dated 1-3-1987 was to be admissible to a manufacturer if the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... water piping etc. Ld. Consultant submits that the Collector in arriving at the value of the goods cleared during the various financial years has taken the entire value of the contracts work and given only 10% benefit towards erection, installation, commissioning charges and the civil works required to be undertaken by them. In other words 90% of the total contract value has been taken as the value of the goods. This value it appears, has been taken on the basis of the arrangement of payments by the DGS D to the appellants. Further, value of the goods has been taken in that financial year in which the payment has been made. Ld. Consultant points out that deduction of merely 10% out of the total value of contract is most arbitrary inasmuch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... say in 1981 but the payment was received by the appellants in 1983-94. The Collector has taken the clearances as during the financial year 1983-84. He submits that this is against the provisions of law. Duty is required to be paid at the time of removal of the goods from the factory under Rule 9(2) of the Central Excise Rules, 1944. Date of receipt of payment or date of raising of the bill either by the party or by its customer has no relation to the date of clearance of the goods from the factory. Ld. Consultant has submitted that the air handling units by no imagination can be considered as `refrigerating air-conditioning machinery . It is only a machine for supplying and directing air. There is no compressor and cooling coil in the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssembled/installed at site (known as Central plants) provided that parts, components and accessories used in the assembly at site have paid appropriate excise duty. This circular of the Board has not been taken into account by the Collector while arriving at his decision in the impugned order to fasten duty on the appellants. We also notice that the Collector is not well founded on any ground when he allows only 10% deduction from the works contract price in arriving at the value of the goods for the duty liability of the appellants. Proper valuation of the goods has to be made. The plea regarding classification of air handling unit has also not been properly considered by the Collector. He has not taken into account the plea that the air h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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