Tribunal rules duty cannot be levied on bought-out items used in tower erection

The Appellate Tribunal set aside the order confirming demands on bought out items like nuts and bolts used in tower erection. Citing relevant judgments, the Tribunal held that duty cannot be levied on bought out items when duty-paid goods are removed to the site with bought out finished goods. The impugned order was deemed incorrect, leading to the appeal being allowed with necessary relief granted to the appellants.

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Issues Involved:
Appeal against demands on bought out items like nuts and bolts used in the erection of towers.

Analysis:
The appeal before the Appellate Tribunal arose from an Order confirming demands on bought out items like nuts and bolts used in the erection of towers. The appellants sought a decision on the merits of the case. The bench sought assistance from a consultant, Shri Venkatesh, who cited relevant judgments in favor of the assessee. He referred to a judgment in the case of Supercold Refrigeration Systems Pvt. Ltd. Vs. CCE, Cochin, where it was held that the value of bought out items need not be added to the goods received from the factory if they are used along with other equipment for manufacturing goods. Additionally, reliance was placed on judgments in the cases of Silson India Pvt. Ltd. Vs. CCE, Thane, and Emerson Network Power India (P) Ltd. Vs. CCE, Mumbai, supporting the same principle.

The Learned JCDR conceded the position and presented a ruling of the Tribunal in the case of BHEL Vs. CCE, Meerut, which also supported the view that duty cannot be levied on bought out items when duty-paid goods are removed to the site along with bought out finished/installable goods procured from the market. After careful consideration, the Tribunal found that the order confirming demands on bought out items was incorrect in light of the judgments cited. Therefore, the Tribunal held that the impugned order was not legal and proper. Consequently, the Tribunal set aside the order confirming demands on bought out items and allowed the appeal with any consequential relief deemed necessary.

The operative portion of the Order was pronounced in open court at the conclusion of the hearing, where the Tribunal provided relief to the appellants by setting aside the order confirming demands on bought out items like nuts and bolts used in the erection of towers.

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