Jyoti Balasundaram, Member (J)
1. The application for waiver of pre-deposit of duty of Rs. 32,94,300/- and penalty of equal amount arises out of the order of the Commissioner of Central Excise, Mumbai. The duty demand has been confirmed as a result of addition of charges for installation/fabrication of storage vessel for petroleum products (herein after called Bullets) shown in the purchase orders of BPCL and recovered by the applicants herein during the period from April 1997 to May, 1999 at the rate of 12,10,000/- per bullet.
2. On hearing both sides, we find prima facie force in the contention of the applicants that the item in dispute which was removed in 3 segments that is in CKD condition as the same could not be delivered/transported in one piece from the applicants’ factory due to huge size thereof are not excisable goods, as after erection on civil foundation at the customers’ site, the same become immovable property. In the present case site fabrication includes – Assembly of Bullet Sections, Welding, Stress Relieving (Heat Treatment), Radiography, Erection and Testing, Painting, Supply of all tools and tacklets, manpower, Inspection by TPIA and Obtaining CCOE approval. The plea of the applicants is supported by Board’s Order No. 58/1/2002-CX dated 15.1.2002 issued in exercise of powers under Section 37B of the Central Excise Act, wherein it has been stated that huge tanks made of metal for storage of petroleum products in oil refineries or installations are not movable and cannot be considered as excisable goods, as the tanks, though not embedded in earth, are erected at site, stage by stage, and after completion they cannot be physically moved and on sale/disposal they have necessarily to be dismantled and sold as metal sheets/scrap and it is not possible to assemble the tank all over again. The circular relies upon the Supreme Court judgment in the case of Triveni Engineering & Industries Ltd. v. CCE (2000 (120) ELT 273 (SC) and Tribunal’s decision in the case of CCE Chandigarh v. Bhagwanpura Sugar Mills [200247)RLT 409]. The Commissioner’s finding that the goods in question are not covered by Section 37B order is prima facie wrong. We are, therefore, of the view that the applicants have made out a strong prima facie case for waiver on merits and hence dispense with the pre-deposit of duty and penalty and stay recovery thereof, pending the appeal.