TaxTMI 
TaxTMI 
2014 (2) TMI 326
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....ia) Ltd., are engaged in the manufacture of Drilling Rig and Mud Pump and cleared the said drilling rigs on payment of full excise duty on the value of the same in accordance with Section 4 of the Central Excise Act. The appellant also manufactured certain goods which were not part of the rigs, but were drilling tools, accessories or operating equipment to be used in conjunction with the rig on payment of duty. They also purchased and sold certain goods which were not parts of the rigs, but were drilling tools, accessories or operating equipment and were used in conjunction with the rigs. These are goods such as drill pipes, drill bits, substitutes, slips, spiders/spider bushings, drill collars, casing elevators, fishing tools, traveling bl....
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....t has suppressed the fact that the said items amounted to essential parts of rigs and had cleared the same in the guise of accessories to evade payment of excise duty. The appellant was therefore called upon to show cause as to why excise duty of Rs.86,16,363/- for the period December, 1987 to September, 1992 should not be recovered under the proviso to Section 11A and why penalty should not be imposed. Thereafter, the department issued 8 more show-cause notices between June, 1993 and January, 1997 on similar allegations and seeking to recover excise duty of Rs.10,90,571/- (in aggregate) on the said bought-out items on the same ground. (iii) The appellant contested the said show-cause notices contending that the said drillin....
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....for motor drilling. Among the items it shows that parts of a rig are a mast. The cost of mast therefore would be included. However, the delivery hose, stand pipe, suction hose, bush, those goods which are classifiable as parts of rig falling in chapter heading 84.31, the cost of the goods could be included in the value of the rig, unless the appellant were able to show that they were supplied not incorporated in the rig but as spare part, the value of such was not included in the price of the rig. The price of the goods which are clearly not required for the manufacture of the rig would not be included. We think it appropriate that the precise determination of the value of the rig can be carried out by the adjudicating authority by applying....
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....unal in the case of Ingersoll Rand Vs. CCE - 1994 (69) ELT 737 (T) which was confirmed by the Hon'ble Apex Court in Civil Appeal No. 4371 of 1994 vide order dated 5.3.1998 wherein the Hon'ble Apex Court held that drill rods/pipes and drill tools etc. are not to be treated as part of the drill rig and value thereof not includable in the assessable value of the drill rig, thereby upholding the decision of the Tribunal. (viii) In view of the order in the Ingersoll Case as confirmed by the Hon'ble Apex Court, the learned Counsel stated in the impugned order that out of total original demand of duty of Rs.99,08,934/-, after making correction for clerical errors, the correct demand comes to Rs.83,37,892/-. Out of this amount, dema....
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....) wherein, in the case of boiler, pressure parts of boiler were removed in several consignments, to be regarded as boiler in incomplete form and classifiable as boiler being essential parts of boiler, as it is not possible to clear the complete boiler in one go. 5. Having considered the rival submissions, we find that ruling of Thermax Bobcock & Wilcox Ltd. (supra) relied upon by the learned AR for the Revenue, is clearly distinguishable because boiler is not cleared in its assembled form as such but cleared in several consignments part by part and assembled, whereas in the facts of the present case, the drill rig is complete when removed or cleared from the factory, and thus, the ruling of Thermax Bobcock & Wilcox Ltd. is not applicable....