Site-fabricated storage tanks as immovable property: no central excise duty, so the related penalty also falls away.

Steel fabricated storage tanks erected piece by piece at the site for storing petroleum products were treated as immovable property, not excisable goods. Following the Board's circular and prior Tribunal guidance on similar site-fabricated storage facilities, the classification under Chapter 83 could not sustain central excise duty because the installations were not liable to levy in the first place. As no duty was payable, the associated penalty also could not survive. The duty demand and penalty were therefore set aside, and the appeals were allowed.

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Issues: Whether steel fabricated storage facilities erected at site for storing petroleum products amounted to excisable goods liable to duty under Chapter 83 of the Central Excise Tariff Act, 1985, and whether penalty could be imposed when no levy was sustainable.

Analysis: The fabricated storage tanks came into existence only by piece-by-piece assembly at the premises, and their size and manner of construction showed that they resulted in immovable property. The Board's circular and the prior Tribunal decision on similar site-fabricated storage facilities were followed. Since the goods were not exigible to central excise levy, classification under Chapter 83 could not sustain a duty demand. Once no duty was leviable, penalty also could not survive.

Conclusion: The storage facilities were held to be not liable to central excise duty, the duty demand and penalty were set aside, and the appeals were allowed.

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