Territorial jurisdiction, immovable property, and limitation defeated excise demand on an embedded offshore radar platform.

Territorial jurisdiction under central excise could not be extended beyond the notified commissionerate to cover offshore work carried out beyond its limits, so the adjudication was without jurisdiction. A radar station/platform assembled on site and embedded in the seabed, which would become scrap on dismantling and could not be reassembled elsewhere, was treated as immovable property and not excisable goods. The demand was also held time-barred because the relevant period exceeded the normal limitation and no suppression or valid basis for extended limitation was established. The assessee was therefore entitled to relief on all examined grounds.

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Issues: (i) Whether the Commissioner of Central Excise, Bangalore had jurisdiction to adjudicate demands concerning offshore/onshore work carried out beyond the territorial limits of its commissionerate; (ii) Whether the assembled radar station/platform constituted excisable goods or immovable property; (iii) Whether the demand was barred by limitation.

Issue (i): Whether the Commissioner of Central Excise, Bangalore had jurisdiction to adjudicate demands concerning offshore/onshore work carried out beyond the territorial limits of its commissionerate.

Analysis: The territorial reach of the Bangalore Commissionerate was confined to the notified districts, and the work in question was carried out in the deep-sea beyond the shores of Mumbai. The jurisdictional provisions could not be stretched so as to treat any place outside the approved factory and beyond the commissionerate as part of the factory for adjudication purposes.

Conclusion: The jurisdictional objection was accepted in favour of the assessee.

Issue (ii): Whether the assembled radar station/platform constituted excisable goods or immovable property.

Analysis: The components had already suffered duty and what emerged after assembly was a platform embedded in the seabed on which the radar equipment was fixed. On dismantling, the structure would be reduced to scrap and could not be re-assembled elsewhere. Applying the governing excisability principle, the assembled structure was not goods but immovable property.

Conclusion: The structure was held to be not excisable and the issue was decided in favour of the assessee.

Issue (iii): Whether the demand was barred by limitation.

Analysis: The relevant period preceded the show cause notice by more than the normal period, and the assessee's belief that no excisable goods came into existence was found to be bona fide and supported by judicial principles. In the absence of suppression established on the facts, the extended demand could not be sustained.

Conclusion: The demand was held to be time-barred in favour of the assessee.

Final Conclusion: The order of demand could not survive on any of the examined grounds, and the assessee was entitled to consequential relief.

Ratio Decidendi: A structure assembled at site and embedded in the seabed, which cannot be moved without dismantling into scrap, is immovable property and not excisable goods; where jurisdiction is territorially confined and no valid basis for extended limitation is established, the demand cannot be sustained.

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