TaxTMI 
TaxTMI 
2017 (12) TMI 281
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....) Wamshi Industrial Corporation Ltd. (Job NO. 69401) (5) Glarion Power Corporation Ltd. (Job No. 76605) (6) Selco International Ltd. (Job No. 88005) (7) Sai Renewable Power Pvt.Ltd. (Job No. 76005) During investigation representative of the company Shri D.V. Vairagkar Dy. General Manager in the statement recorded under Section 14 of the Central Excise Act, 1944 with reference to the definition of Boiler, he was asked to state as to whether the parts manufactured in Walchandnagar Industries Ltd. (WIL) in respect of above named projects would qualify the definition of Boiler under IBR, to which he stated that pressure parts are being manufactured at their works at Walchandnagar and thereafter boiler is installed at site; that all pressure parts are not manufactured at WIL, that Main Drum, Lower Drum, Headers, Boiler Tubes/Panels,, Super Heater, Economiser are the pressure parts of the Boiler and that structure, Furnace, Air Heater, Dust Collector (mechanical, ESP) Ducting, Piping, Valves, Pumps, Chimney, instrumentation and electrical items are other parts which put together to form a Boiler/System for energy generation. On a specific query whether all pressure part are manuf....
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....shown. The appellant have been declaring the boiler in CKD/SKD form in their classification list which was filed right from 1995 as well as in the invoices issued for removal of goods clearly declared the Chapter Heading 8402.10, which is meant for boiler and not for parts. He also submits that the entire boiler has main nine pressure parts out of which seven pressure parts were manufactured by the appellants in house, one part was getting manufactured on job work basis and two parts are bought out. Therefore the major portion of the boiler is manufactured by the appellant therefore the same clearly falls under the exemption entry i.e. non-conventional energy device/system as provided in Sr. No. 254 of Notification No. 3/2001 dt. 1.3.2001, hence the same is eligible for exemption therein. He submits that by taking over all value of the boiler the parts supplied from outside range from 1% to 2% value out of the total value of the boiler. It is not disputed that the appellant are themselves undertaking to supply, erect and install the boiler which in any case comes into existence i.e. from the stage of manufacturer of major parts of the boiler, supply and erection installation of boi....
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....on under heading 8402.10 claiming exemption under various notification particularly 3/2001-CE(Sr. No.254) was disclosed. Therefore there is no suppression of fact on the part of the appellant as the department was having all the material for raising any query about the eligibility of the exemption notification. The demand is clearly time barred for the period beyond 1 year of the issue of show cause notice. In the present case the period involved is 1.3.2000 to 18.3.2004 and the show cause notice was issued on 30.3.2005 accordingly the entire demand is time barred. In this support Ld. Counsel relied upon the Tribunal judgment in the case of Boving Fouress Ltd. Vs. Commissioner of Central Excise, Chennai - 2004 (1750 E.L.T. 899 (Tri.-Bang.). He further submits that since the appellants have cleared the goods under exemption Notification No.3/2001-CE dt.1.3.2001 they have followed the provisions of Rule 6(3) of Cenvat Credit Rules and accordingly reverse an amount of 8% of the value of the goods which was not adjusted by the adjudicating authority. 3. Shri Ajay Kumar Ld. Additional Commissioner (A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order.....
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....nt to note that with all the buyers, the appellant have entered into a contract for supply of complete boiler and its erection and installation at the site of the buyer. On execution of the complete contract the appellant have supplied the complete boiler and erected and installed the same. This clearly shows that the appellant have successfully executed the contract wherein the complete boiler was supplied and installed. On the face of this undisputed facts continuation of the Revenue that the boiler does not come into existence and it is only part of boiler supplied by the appellant is far from the truth. The Board in Section 37B order No.4/92 dt. 19.5.1992 has clarified as under: M/s. Cether Vessels Ltd. Tiruchirapalli, engaged in manufacture of Fluidised Bed Combustion Boilers (FBCB), have represented to the Central Board of Excise and Customs (Henceforth referred as Board) that they have been denied the benefit of exemption under S. No.15 of the table annexed to Notification No.205/88-CE dt. 25/5/1988 (earlier Notifn. No.120/81-CE dated 15/5/81) (a) Only assemblies/components are being cleared by them for erection of FBCB at site. (b) The FBCBS can also work on other Fu....
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....f this order be sent to all Principal Collectors of Central Excise and Collectors of Central Excise for being observed and followed by all other manufacturers similarly placed and for being made available are required to all other persons employed in the execution of the Central Excise & Salt Act, 1944 and for issue of Trade Notice. From the above Section 37B order it can be seen that identical issue has been clarified that even the boiler is cleared in CKD/SKD conditions the exemption is available subject to condition that supply of such device/system to buyer is established. In the facts of the present case, as per the contract and execution thereof it is established that the goods supplied to the buyer is non-conventional energy device/system i.e. Biomass boilers, though cleared in CKD/SKD form. This issue has been considered time and again by this Tribunal and even in a case of supply of a part of such device the exemption was extended. In this regard some relevant judgments are reproduced below: (I) Thermax Bobcock & Wilcox Ltd.(supra) held that- "6.Heard both sides. (a) Whether the goods as cleared by the respondent is classifiable as boiler under sub-heading 8402.10 ....
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....d not claimed Modvat credit of duty paid on bought out items and therefore the bought out items cannot be said to be the constituents of a boiler. (II) Rachitech Engineers Pvt. Ltd. (supra) held that- "5. We have considered the submissions from both the sides and perused the records. Sl.No.237 of the table to the Notification 6/2002-CE covers non-conventional energy devices/systems specified in list 9. Sl.No.16 of the list 9 covers agricultural, forestry, agro industrial, industrial, municipal and urban waste conversion devise "producing energy". There is no dispute that the chimneys manufactured by the appellant are meant for biomass burning boilers being manufactured by M/s. ISGEC John Thompson who in turn supply such broilers to the end-users for production of energy from waste. The Commissioner (Appeals)'s view is that since what is covered by Sl.No.237 of Notification No.6/2002-CE is the non-conventional energy devices/ systems and since there is very thin distinction between part and device, as the device is thing made for a particular purpose and since chimney being an integral part of the biomass fired broiler can be treated as a device for non-conventional energy d....
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....ile other descriptions specifically refer to a particular device/machine, the description against Sl. No. 16, is so wide and comprehensive so as to cover all types of conversion devices which are required for conversion of the waste for producing energy. While the appellants have been ordered to supply specific devices which have been supplied in Knocked Down condition, it is difficult to presume that the goods cleared by them in such a condition cannot be brought under the broad description shown in Sl. No. 16 of List 9 of the notification. It is not the case of the Revenue that the goods supplied by the appellants even in Knocked Down Condition do not contribute for the conversion of the waste into energy. The appellants had produced the diagram to substantiate that all the individual items supplied in knocked down condition would contribute to the ultimate product namely a boiler/generator which could not be supplied in one lot. As it has already been observed above, the description in List 9 to the said notification being very wide cannot be given a restricted meaning that it could not cover each individual item which is cleared in Knocked Down Condition as the description cove....
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.... No.237 of the table to the Notification 6/2002-C.E. covers non-conventional energy devices/systems specified in list 9. Sl. No. 16 of the list 9 covers agricultural, forestry, agro industrial, industrial, municipal and urban waste conversion devise "producing energy". There is no dispute that the chimneys manufactured by the appellant are meant for biomass burning boilers being manufactured by M/s. ISGEC John Thompson who in turn, supply such broilers to the end-users for production of energy from waste. The Commissioner (Appeals)'s view is that since what is covered by Sl. No. 237 of Notification No. 6/2002-C.E. is the non-conventional energy devices/systems and since there is very thin distinction between part and device, as the device is thing made for a particular purpose and since chimney being an integral part of the biomass fired broiler can be treated as a device for non-conventional energy devices/systems, the exemption under this Notification would be available to the chimneys. We agree with the view of the Commissioner (Appeals), as rightly observed by the Commissioner (Appeals), the device is a thing made for a particular purpose and as such the chimney meant for b....
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....conversion devices which are required for conversion of the waste for producing energy. While the appellants have been ordered to supply specific devices which have been supplied in Knocked Down condition, it is difficult to presume that the goods cleared by them in such a condition cannot be brought under the broad description shown in Sl No 16 of list 9 of the notification. It is not the case of the Revenue that the goods supplied by the appellants even in knocked down condition do not contribute for the conversion of the waste into energy. The appellants had produced the diagram to substantiate that all the individual items supplied in knocked down condition would contribute to the ultimate product namely a boiler/generator which could not be supplied in one lot. As it has already been observed above, the description in list 9 to the said notification being very wide cannot be given a restricted meaning that it could not cover each individual item which is cleared in knocked down condition as the description covers all devices meant for the ultimate purpose. While giving a finding as above we have taken into consideration the broad description of the device as shown in Sl No 16 ....