TaxTMI 
TaxTMI 
2005 (7) TMI 242
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....e list 5 of the said notification. Sr. No. 13 of the list 5 mentioned 'Wind Operation, Electricity Generators, their components and part thereof'. The 'flanges' so cleared, as it appears from the show cause notice para 2, which reads as - "2. Investigations in the matter revealed that these flanges were used by the customers in the erection of the towers/structures of the wind mills or the wind operated electric generators and not claimed by the assessee in the manufacture of wind operated electric generators as its spares or components which are exempted from payment of duty by virtue of Notification No. 6/2000 dtd. 1-3-2000 as amended. Purchase orders of the Customers also clearly mentioned for supply of M.S. forged flanges for w....
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.... In the case of Bharat Heavy Electricals Ltd. v. Collector of Customs, Chennai as reported in 1999 (108) E.L.T. 448 (T) the Tribunal has held that - "Goods imported not to be regarded as complete WOEG having been imported without tower and foundation." The said finding has been elaborated as follows : "Since 'manufacture of WOEG will not be complete without placing the wind turbine consisting of nacelle, rotor, hub and blades and controller and communication (the imported goods) on a tower erected on a foundation, the goods cannot be themselves be deemed to have constituted - minus tower and foundation - a complete WOEG." However, the question here is that MS flanges are parts of the tower, which in tu....
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.... I observe that the company has misled the department by declaring their products MS Flanges as 'windmill spares and parts' inasmuch as that MS Flanges are merely parts of the tower. Moreover, though the company has quoted Sl. No. 251 of the notification and List 5 therein, the relevant Sl. No. in List 5 has deliberately been left out in an attempt to convey the impression that the products manufactured by them are parts and spares of the windmill itself. Since the Sl. No. applicable to the company's product is Sl. No. 20 of List 5 which contains clear specifications to the effect that exemption would be available only if the same i.e. MS flanges is captivity consumed in the manufacture of tower, the company's failure to mention the corr....
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....nd Mill being huge structures would only came into existence in the factory of manufacture as a design & in fact they would arise only infact at site after assembly using the flanges. Consumption at site in tower is not questioned on facts nor it can be said that flange is not used where the tower came into existence. The concept of interpretation of "consumed in factory of production" & limiting the same to the Central Excise registered premises of the appellants herein & deprive the use at site cannot be upheld. 2.3 In any case, the flange being part of tower which is Essential Component of Wind Operated Electrical Generator, an unconventional energy service device, would be eligible under Sr. No. 5 if not under 20 as part of Sr. No. 1....