TMI Blog2015 (1) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... r No. 21888 / 2014 - Dated:- 13-10-2014 - SHRI B.S.V.MURTHY AND SHRI S.K. MOHANTY, JJ. For the Appellant : Mr. S. Thirumalai, Mr. Harish Bindumadhavan, Advocates For the Respondent : Dr. A. K. Nigam, Addl. Commissioner (AR) JUDGEMENT Per : B.S.V.MURTHY; The issue involved is classification of galvanized silo storage system which according to the appellant is the product manufactured by them. The period involved is April 2012 to February 2013 and duty demanded is more than ₹ 2.67 crores with interest. Penalty of ₹ 50/- lakhs has also been imposed. 2. We have heard both the sides in great detail and considered the submissions and also perused the records. The appellant is contending that the product is classifiable under Chapter Subheading 8437 10 00 of Schedule to the Central Excise Tariff Act, 1985 whereas the department has taken a view that product is classifiable under Chapter subheading 9406 00 99. The Chapter heading 84 37 of CETA, 1985 reads as under Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables; machinery used in the milling industry or for the working of cereals or leguminous vegetables, other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufactured/fabricated by the assessee in their factory premises for ultimate installation at the customer s site which also include civil construction at the customer site as per the requirement of their customer. These fabricated components/structures/parts are later transported by the assessee to the customers site over a period of time for assembly at site. * The argument of the Appellants that silos are equipped with pre-cleaners, fine cleaners etc., which forms a complete machinery system and since the same is used for milling industry they should invariably fall under Chapter sub-heading No. 8437 of CETA, 1985 is fallacious inasmuch as silos are also cleared to the customers without any pre-cleaners, fine cleaners etc., since these are optional items which can be customized depending on the requirement of the customers. * As per Rule 3(a) of General Rules of Interpretation of the First Schedule to the Central Excise Tariff Act, 1985, it is clear that the silo in general being in the nature of pre-fabricated building (essential character) and functionally used for housing or storage are specifically covered under Chapter heading No. 9406 of CETA, 1985 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Appellant s catalogue clearly shows that the Silo s are equipped with pre-cleaners, fine cleaners, destoners, conveyor with belt/chain, elevators, temperature and level sensors, temperature controllers, aeration system, etc., and thus, the silos are not mere storage structure but a complete machinery system consisting of equipment, and machinery for fine cleaning, and storage and hence rightly classified under CETH 84378090 in as much as it is a machinery used in the milling industry. * The Appellant has been consistently declaring the manufacture and clearance of the subject goods rightfully classifying them as agri processing machines based on the bonafide belief that subject goods being machinery used in milling industry can be termed as such. Therefore rendering the classification of the said goods under CETH 84.73 as correct and proper. * The silo s manufactured by the Appellant are similar to that considered in the Thermax judgment. Therefore the said judgment will continue to apply to the case of the Appellant as well and the classification under heading 84.37 claimed by the Appellant is tenable in law. The Thermax judgment has not been reversed ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esented together, to be assembled on site. It is quite evident that silos are erected/constructed by the appellant on the customers site. In fact the process only results in a construction of a civil structure which becomes an immovable property/capital asset in the form of a complex system of machinery and it therefore not an excisable goods at all as the impugned goods are formed at site and becomes an immovable property as held in the case of Thungabhadra Steel Products v. Union of India, 1998(98) ELT 334 (Kar). * It is impossible to dismantle the silo without any damage. The decision of the Honorable Apex Court in Triveni Eng. Indus Ltd v. Commissioner of Central Excise 2000 (120) ELT 273 (SC). Para (e) of CBEC circular No. 58/1/2002-CX., dated 15th January, 2002 also supports the said contention. * The Appellant disowns any such brochure mentioned/reproduced certain contents at Para 15.1 and Para 22.1 on the findings. In any case neither does the SCN nor does the Appellants reply relies on any such brochure. 3.1 In addition to the above, the learned counsel also filed a miscellaneous application for additional grounds of appeal wherein the foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent would have evaluated the classification of Silos manufactured by the Appellant as per 4 Digit Chapter Heading of 9406 and thereafter determined the sub-heading. A comparison at a sub-heading level is possible only if there is an anomaly in classification within a Chapter Heading. 4. After hearing both the sides and considering all these submissions, we came to the conclusion that it would be appropriate to remand the matter at this stage itself even though in respect of the very same product this Tribunal vide Stay Order No.1180-1182/2012 dated 5.7.2012 had taken a view that the appellant has to deposit the amount that may be payable during the normal period. The learned AR submitted that there is no reason why this order should not be followed. In the normal course this would have been the approach followed by us and in fact we would have also not heard the party in great detail. The learned counsel pressed that he has different grounds to address and should be given an opportunity and hence the matter was heard in great detail. We find that there are three major differences why we intend to remand the matter at this stage to the original adjudicating authority. (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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