SAKTHI SUGARS LTD. Vs. COMMR. OF CEX, CHENNAI

JUDGEMENT

(1.) Both these appeals raises a common question of law and facts pertaining to the same assessee and hence they are taken up together for disposal as per law. The question arising in these appeals are as to whether the item which is erected by the appellant is Effluent Treatment Plant (ETP) or Bio -gas plant (2) whether it is movable and marketable, (3) whether it is excisable under the Central Excise Act and (4)whether there was any willful suppression with the intent to evade payment of duty for confirmation of demands.

(2.) In the show cause notice dated 24.3.99 at para 6 and 7, the process of erection of the item has been described which is extracted below: -

(3.) The appellant's main contention was that the item was erected piece -by -piece after laying down the foundation and what came into existence was an immovable property in the form of huge metallic tank of a size of 22 Meter diameter and 11 meters in height and weighing 200 tonnes. All the raw materials which were used were all duty paid and the erection was carried out at great length of time by fabrication and welding and the said item cannot be dismantled. On dismantling, it loses its characteristics and the same materials cannot be utilised for erecting the same plant elsewhere of the same size. They also relied on the Board's circular No. 17/89 dated 21.4.1989 which was in force during the relevant period which clearly laid down that such structures which are attached to the earth is immovable property and not goods liable to Central Excise duty. They also denied the allegation of suppression of facts and stated that the department was well aware of all the facts and there was no suppression willfully as alleged for the purpose of invoking larger period. The Ld. Commissioner considered the matter in the impugned order and after examining the literatures and submissions, rejected their plea that the item is a Bio -Gas plant and concluded that it is an Effluent Treatment Plant in the finding recorded in para 9 to 14. In para 15 to 21, he has dealt with the aspect of the item being movable goods. The main consideration for him to arrive at this conclusion that it is movable item is that since one Shri R. Rajendran in his cross -examination had stated that M.S. sheets can be cut and can be re -fabricated to form another digester though the volume of digester would get reduced after such re -fabrication, The Commissioner has held in para 17 to 21 as follows: -