TMI Blog2010 (2) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... on - Find that the appellant had no intention to evade duty due on the steel structurals cleared by it during the material period - Prima facie, the appellants were not required to pay excise duty on the impugned goods - Hence, complete waiver of pre-deposit of the dues adjudged against the appellant and stay of recovery thereof pending decision in the appeal. - E/374/2009 - 289/2010 - Dated:- 15-2-2010 - S/Shri M.V. Ravindran, P. Karthikeyan, JJ REPRESENTED BY : Shri P. Raghuram, Advocate, for the Appellant. Shri M.M. Ravi Rajendran, JDR, for the Respondent. [Order per : P. Karthikeyan, Member (T)]. - M/s. A.V. Pandhe, Visakhapatnam has filed this application for waiver of pre-deposit and stay of recovery of Central Excise duty of Rs. 3,58,61,693/- demanded from it and equal amount of penalty imposed under Section 11AC of the Central Excise Act. The appellants were found to have engaged in manufacture of steel structurals such as columns, rafters, purlins, sub-beams, floor-beams and sub-columns, staircases etc., without following central excise formalities including payment of duty due. The appellants had converted raw materials such as channels, angles, plate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /05-C.E., dated 24-2-2005, (Sl. No. 64). The adjudicating authority failed to appreciate the CBEC Circular No. 456/22/99 dated 18-5-1999, in the context of assessee s eligibility to Notification No. 3/05 C.E. dated 24-2-2005. The impugned goods were exempt in terms of Sl. No. 64 of the above notification. CBEC Circular No. 456/22/99, dated 18-5-1999 applied to the assessee s situation. The scrap items on which duty was demanded were remnants of angles, channels purchased from the manufacturers on payment of duty. These were not excisable as scrap since they continued to be channels, angles, etc. There was no allegation regarding intention to evade duty. The appellants had bona fidely believed that the impugned goods were not excisable. The liability of the appellants would be drastically reduced once it was allowed cenvat credit of duty paid on inputs. 3. Learned counsel representing the appellants took us through Notification No. 5/98 C.E. and the CBEC Circular No. 456/22/99 CX. dated 18-5-1999 to argue that the impugned clearances of goods fabricated for use in construction work were exempt from payment of duty in terms of Notification No. 3/05 dated 24-2-2005. As per Sl. No. 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not alter the classification; that the assessee did not supply any flooring was not relevant for classification of the goods. (2) Mittal Pipe Manufacturing Co. v. CCE, New Delhi [2002 (146) E.L.T. 624 (Tri.-Del.)] After noting that the appellants customers had placed order for pre-fabricated buildings following which the appellants had supplied completed pre-fabricated buildings, the Tribunal rejected the plea that the goods involved were not pre fabricated buildings for the reason that it had not supplied flooring. The Tribunal also held that bought out item supplied to it s customers along with other items, constituted complete pre-fabricated buildings and the goods supplied by the assessee were classifiable as pre-fabricated buildings. (3) Controls Schematics Ltd. v. CCE, Hyderabad [2007 (216) E.L.T. 532(Tri.-Bang.)] In this case, the Tribunal had rejected the contention of the revenue that the assessee had cleared steel structures of Chapter 7308 as the goods involved were pre-fabricated buildings (telephone booth) in CKD as per the relevant HSN explanatory notes. (4) Mittal Pipes Manufacturing Co. v. CCE, Delhi [2008 (231) E.L.T. 196 (S.C.)] Vide thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in more than one consignment and bought out items were used, did not detract its classification as pre-fabricated building of Chapter Heading 9406. In the instant case, we, prima-facie, find that the assessee had cleared pre-fabricated building in CKD/SKD condition and not steel structurals of CSH 730890110. Even if it is held that the impugned clearances were of steel structurals, the same cannot be denied the exemption extended at Sl. No. 64 of the table to Notification No. 3/05 C.X., the exemption is admissible to goods fabricated at site of work for use in construction work on such site. As per CBEC Circular 456/22/99 C.X., dated 18-5-1999, site appearing in the context of a similar exemption included premises made available to the manufacturer of goods by way of specific mention in the contract/agreement for such construction work provided that the goods manufactured at such premises were solely used in the said construction work only. We find that in the instant case, the tender documents lay down the premises where the steel structurals were to be fabricated. The circular was issued since the field formations had denied exemption to beams/girders manufactured away from c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said exemption. It had only failed to follow the procedure prescribed in the notification. In the circumstances we find that the appellant had no intention to evade duty due on the steel structurals cleared by it during the material period. Prima facie, the appellants were not required to pay excise duty on the impugned goods. It appears that the impugned goods are pre-fabricated building of CH 9406 also for tender documents as well as the clearance documents and not steel structurals of CSH 730889010. The show cause notice proposed to demand duty on 5,092.735 MTs of structural steel dispatched; not on any particular items of steel structurals. We also note that the major part of the clearances comprised bought out items such as channels, angles, pipes and buildings, and bolts, nuts and screws; this fact was ignored in determining the liability of the appellants found in the impugned order. 8. In the circumstances, we order that there shall be complete waiver of pre-deposit of the dues adjudged against the appellant and stay of recovery thereof pending decision in the appeal. (Operative portion of the order already pronounced in open Court on conclusion of the hearing) - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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