Per Shri V.P. Gulati :

This appeal is against the order of the learned lower authority under which he has demanded duty from the appellants for the reason that an excisable product viz., Radar came into existance at site before its installation at the off/on shore platforms at ONGC. The learned lower authority while discussing the merits, in para 10 has held as under :

10. Coming to the merits of the case, it is admitted that M/s. BEL have paid duty only on the items manufactured & cleared by them and not on those goods which are assembled at the site along with duty paid items. In other words M/s. BEL have used the items manufactured by themselves and other parts suitable for the project purchased from other sources, in the activity of assembly/installation, at on shore/off shore Radar Station, in accordance with the contract, signed between themselves and ONGC. The cost of all these items used in the project are liable for inclusion in the value for the purpose of payment of Central Excise duty. The contention that the said Radar System is an immovable property cannot be accepted, as prior to affixation to the base, the products on assembly emerge as identifiable "goods" under Central Excise Tariff Act, 1985. It is immaterial whether such goods emerge on or off shore platform or on shore. The Radar and Communication Equipment cannot become operational unless these are integrated by way of assembly. In other words, the system as such comes into being only after such assembly.

2. The learned Advocate for the appellants Shri B.V. Kumar has pleaded that the learned lower authority has not appreciated the facts in the proper perspective and has omitted to take note of the fact that the appellants had contracted to supply radars to ONGC for installation at off shore/on shore at different platforms. They had manufactured part of the equipment themselves and which were cleared under Gate Passes on payment of duty and part of the equipment was procured from outside and which had also been cleared as per law and the equipments which were bought out were directly supplied to site for assembly along with the parts which were manufactured and cleared by the appellants themselves. He has pleaded that the appellants has taken a plea that no radar as such was cleared from the factory and, therefore, the question of demand of duty from the appellants would not arise.

3. The learned Advocate has pleaded that the learned lower authority in para 10 of his order has merely observed that they have used the items manufactured by themselves and other parts suitable for the project purchased from other sources in the activity of assembly/installation at on/off shore radar stations in accordance with the contract and has stated that the cost of these items used in the project are liable for inclusion for excise duty purposes. He has pleaded, he has not taken note of the fact as to how the radar came into existance, whether it came into existance in situ or the item in an excisable form came into existance before it came to be fixed to immovable structures and has pleaded that the learned Collector has merely stated it is immaterial whether such goods emerged on or off shore platforms or on shore. He has pleaded that the learned lower authority has not examined the position with reference to the actual operations carried out to bring into existance the radar at site. He has pleaded that the appellant can be called upon to pay duty only if from their factory the goods in a CKD condition answering to the description of the radar had been cleared. He has pleaded that only a portion of the goods have been so cleared and the question of duty for radar as a whole would not arise. He has pleaded, in any case before the duty on full value of the radar as was contracted for supply could be demanded, a finding would be required to be entered whether excisable goods emerged or whether the radar came into existance in situ as an immovable structure. He has plead