TMI Blog2023 (3) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... es are finally fabricated and fixed (piece by piece) with the help of the angles and brackets fixed to the building facia, column, etc. Barring a few small signages, various elements of RVI upon final fabrication/erection at site like Canopy facia, building facia, monolith, etc are practically immovable. These cannot be removed without cannibalizing, only few smaller signages including Arches and spreaders (direction signs) are made in the factory. Revenue have failed to identify the state or form in which the goods are removed from the factory and whether these are in marketable stage. We further find that the statement of the officers of the Oil Companies is not reliable, as the same is contrary to the documentary evidence being work order, inspection reports, etc. on record, forming part of the relied upon documents. The schedule of rates forming part of the work order mentions fabrication with prescribed materials as per drawings and specifications, fixed securely to existing canopycolumns by welding, etc. at site. ACM panel fixing - to ensure the joint gaps are uniform. Thus, from the work order, partial fabrication at site including welding etc. is evident - Revenue failed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the work of fabrication and installation of Retail Visual Identity ( RVI in short). These RVIs are usually manufactured for petrol pumps (retail outlets) of various petroleum companies like IOCL, HPCL, BPCL, etc. consisting of Spreaders, Facility Signs, Direction Signs, Wall Cladding, Column Cladding, Canopy Facia, etc. These signage or sign board or RVI are classifiable under Chapter Heading 9405, in case of where these signs and are not illuminated, fall under 8310 of the CETA. The entire activity of the RVI is broken down into four parts as follows:- (a) Canopy Facia (b) Sales Building Facia (c ) Building /Column Cladding (d) Spreader, Arches, Direction Facility Signs, Air Sign, etc. 3. The work of canopy and sales building facia etc. is carried out partly at workshop and partly at site. Once the work order is accepted by the appellant, site visit is done for the purpose of measurement of canopy, building and columns. After the site measurement, following materials are purchased on payment of central excise duty, as applicable:- Aluminium Composite Material ACM sheet Aluminium Angle, M.S. Pipe G.I. Sheet s, Iron Sheet CR, HR Sheet s, Ele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rying manufacturing activity and had knowingly and willfully suppressed the actual manufacturing and clearance of the excisable goods without payment of duty and, therefore, the extended period of limitation as provided in proviso to sub-section (1) of Section 11 A of Central Excise Act, 1944 was invokable. The Commissioner, Central Excise Commissionerate-I, Jaipur issued show cause notice C.No.V(H)Adj.I/CE-94/245/2009/2004 dated 23.09.2009 for the period 2004-2005 upto 2009-2010 (till June, 2009) calling upon the appellants to explain as to why:- (i) Central Excise duty amounting to Rs.2,07,67,730 plus Higher Education Cess @ 1% coming to Rs.1,34,701/- should not be recovered under Section 11 A of the Central Excise Act, 1944; (ii) Penalty under Section 11 AC of the Act, read with Rule 25 of the Central Excise Rules, 2002 should not be imposed for contravention of the various provisions; and (iii) Interest under Section 11 AB of Central Excise Act, 1944 should not be demanded and recovered at the prescribed rates. 8. Further, it appeared to Revenue that RVI is not a single good (s) but combination of many Signage /goods, which are put up at different places of the reta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from time to time particularly Circular No.58/1/2002-CX dated 15.1.2002 and Circular No.643/34/2002- CX dated 1.7.2002. Further, directed that the goods have to be classified in the form, in which they are removed from the place of manufacture, c) Further, directed to examine whether items like Building Facia, Canopy Facia, Column Cladding, Building Cladding, etc. will fall under Heading 9405 and /or 8310 of CETA, d) It was also made clear that Interpretative Rule 2 (a) of General Rules of Interpretation of the First Schedule to CETA cannot be of any help for levy of excise duty on anything, which comes into existence, only as an immovable property or in concluding that the value of the excisable goods removed will be the contract value inclusive of the activities of installing and erecting of the goods, making it an immovable property, e) As regards valuation, the Tribunal observed that the Adjudicating Authority have taken sales figures from the Annual Financial Statement of the appellant and treated as the assessable value of the excisable goods, when part of the money realized was in relation to the transport and installation of the fabricated items. The Adjudicating Authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... work for powder coating, as the appellant do not have such facility of powder coating. It is submitted that none of the ingredients viz. ACM sheet, M.S. pipes, M.S. Clamps, Aluminium Angles, Nut Bolts or other hardware items are manufactured by the appellant. The appellant mainly does the activity of cutting and welding of sheets and fabrication of frames made out of sheet and metal angles, to make it suitable for further fabrication and installation at site. The activity undertaken by the appellant can at best be said to be the Works Contract Service . Referring from the copy of the work order No.UPSO/ENG/AS/ERO 10/CX 10 dated 21.09.2006 issued by IOCL, wherein subject is mentioned - supplying, fabrication and installation of Retail Visual Identity (RVI) elements for retail outlets (about 45 nos.) at a total value of Rs.55,29,987/- for 5 nos. of retail outlets. Further, Clause 7 of Special Instructions forming part of the Work Order mentions terms of payments as follows:- (i) 70% of payment shall be released when the material is received at site after dispatch clearance certificate is approved by the third party inspection agency; (ii) 20% of payment shall be released afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Toubro 2015 (39) STR 913 (SC). 16. Ld. Counsel further urges that the whole demand is bad for invocation of extended period of limitation. Revenue have wrongly alleged that the activities of the appellant of RVI came to their knowledge in the course of investigation. Whereas the admitted facts are that the appellant had taken suo moto registration under the provisions of Service Tax and have been making compliance by paying service tax and filing returns. The appellant have been maintaining proper books of accounts in the ordinary course of business. The appellant were also registered with the Sales Tax/VAT Department as works contractor and were discharging the liability under the sales tax. Admittedly, the Service Tax Central Excise Act are administered by the same Department, hence, Central Excise Department was having full knowledge of the activities of the appellant and also the fact that the appellant were discharging service tax liabilities as a work contractor. Reliance is placed on the ruling of the Apex Court in the case of Uniworth Textile Vs. CCE 2013 (288) ELT 161 (SC) and also in the case of Sarabhai M. Chemicals Vs. CCE- 2005 (179) ELT 0003 (SC). 17. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacture and the other service. It is not possible to bifurcate the activities of the RVI, as it is a composite work on Turnkey basis, which includes sourcing of materials, part fabrication in the premises of the appellant or their job worker and thereafter, the finishing and installation is done at the site of the service receiver. No bifurcation can be done of the composite price, which is evident from the impugned order, as the Adjudicating Authority have also failed to bifurcate the composite price as to the cost of the goods and cost of the service. Thus, ipso facto, the demand of excise duty is bad. Ld. Counsel further relies on the ruling of the Coordinate Bench of this Tribunal in the case of Secure Mobile India Vs. CCE Final Order No.50711-50733 of 2019 dated 20.05.2019, wherein for similar work of RVI done for the Oil Companies, it was held that excise duty is not attracted, observing that RVI elements come into existence at the site of the buyer only and once installed at the site cannot be dismantled and re-installed at alternate location. It is also urged that the activity does not amount to manufacture in terms of Section 2(f) of the Central Excise Act. According ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in case of works contract an immovable asset or property comes into existence, whereas in the present case, the appellant have manufactured or fabricated the goods to clear the same from the their factory for installation at retail outlet of the Oil Companies. He further urges that benefit of SSI exemption and calculation of duty on cum-duty basis has already been extended in the impugned order. 21. Having considered the rival contentions and on perusal of the records, it is evident from the pleadings including copy of the work order issued by the Oil Companies, the appellant have acquired various inputs manufactured by other manufacturers like Aluminium Composite Material-ACM Sheets, Aluminium Angles, M.S. Pipes/Angles/clamps, G.I. Sheets, Iron Sheets, CR/HR sheets, Electrical fittings like tube lights, Chowk, Wires, PVC Flex Vinyl, Plastic material Pet G, Arcylic Polycarbonate, etc. After the goods are inspected by the Oil Companies or its nominated agencies, the appellant undertakes fabrication, wherein they do cutting, sizing, etc., as per measurements taken at the retail outlets. Partially fabricated frames in un-finished condition and other cut materials etc. are then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant. 23. Thus, we hold that extended period of limitation is not invokable. We further find that on final fabrication and installation, the RVI forms part of the immovable property at the retail outlet and does not result in manufacture of goods. Further, various elements of RVI are neither movable nor marketable. It has been clarified by the Board in Circular No.58/1/2002-EX, if the goods are incapable of being sold, shifted and marketed without first being dismantled into component parts, the goods would be considered as immovable and, therefore, not excisable to duty. When the final product is considered as immovable, the same product in CKD or in unassembled form will also not be dutiable. We find from the impugned order that the work of RVI involves a large number of components, fabrication and installation. To make foundation/civil structure at site, cannot be considered as excisable goods for imposition of central excise duty. It has been so held in similar facts and circumstances in CCE Vs. Bhagwanpura Sugar Mills 2001 (134) ELT 673, wherein storage tank is erected and installed (though not embedded to the earth) at site stage by stage and after completion ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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