TMI Blog2018 (12) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... equired to be fulfilled, has been laid to rest by the Hon’ble High Court of Bombay in the case CCE Nashik Vs Kent Introl Pvt.Ltd. [2015 (11) TMI 1167 - BOMBAY HIGH COURT]. The Hon’ble High Court has held that such conditions of Customs notification are applicable only to the importer order and not to a domestic manufacturer. The refunds of ₹ 77,95,480/- and also ₹ 49,11,485/- respectively sanctioned to appellants in respect of clearances made claiming the very same Central Excise Notification No.6/2006-CE have been inter alia held as erroneous refunds, will also not sustain and are therefore set aside - Appeal allowed - decided in favor of appellant. - E/Misc/40460/2018, E/41979/2014, E/42143/2014 & E/41454/2016 - FINAL ORDER No. 43048-43050/2018 - Dated:- 10-12-2018 - Shri Madhu Mohan Damodhar, Member (Technical) And Shri P. Dinesha, Member (Judicial) Shri Sujit Ghosh, Advocate, Shri Mannat Waraich, Advocate For the Appellant Shri B. Balamurugan, AC (AR) For the Respondent ORDER Per Madhu Mohan Damodhar Appellants were engaged in the manufacture of industrial valves and parts falling under Chapter 84 of the Central Excise Tariff Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods or the purchaser. Comparing with the situation of imports the purchaser has to satisfy the condition. But these are all logical interpretations and not explicitly provided in the notification. When goods are imported by the contractor or sub contractor, the end use verification becomes easy with reference to the auditing the books of accounts of these persons. A mechanism will be required to ensure proper end-use in the case of goods manufactured in India and supplied to such contractor or sub-contractor which has not been prescribed in the excise notification. Now the option before us is to hold that excise duty exemption under such notification will not be applicable at all to any clearances by a strict interpretation of the conditions as canvassed by Revenue or to hold that excise duty exemption is to be made available subject to necessary changes read into the conditions prescribed under customs notification. The former interpretation is not justified because to our mind it is implied that the condition prescribed in Customs Notification is to be read mutatis mutandis for excise exemption. Once the latter proposition is agreed to we are of the view that the correct in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to Reliance Industries Ltd. The Asst. Commissioner vide order dt. 25.1.2013 sanctioned refund of ₹ 77,95,480/-. However, department issued show cause notice dt. 19.3.2014 seeking to recover the said refund amount of ₹ 77,95,480/-. In adjudication, the Commissioner vide an Order-in-Original No.14/2014 dt.30.06.2014 held that the said refund was sanctioned erroneously by the original authority and ordered recovery of the amount with interest. Hence Appeal No .E/42143/2014. 2.1 Pursuant to CESTAT directions, Commissioner passed a de novo adjudication order No.6/2014 dt.28.5.2014 inter alia, denying benefit of exemption for payment of excise duty in respect of supplies made to Reliance Industries Ltd. on the ground that documents supplied by the appellants were not in consonance with the conditions under Customs exemption notification. The Commissioner also confirmed duty demand of ₹ 78,06,738/- in respect of goods cleared to Reliance Industries Ltd. along with interest thereon. Penalty of ₹ 77,15,962/- was also imposed under Rule 25 of Central Excise Rules, 2002, however giving option to pay reduced penalty 25% of the penalty subject to payment of penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present case as : a. The Customs Exemption Notification required that the certificates had to be issued by the DGH indicating end use- In the present case, as the certificate was issued by the DGH, such condition stood satisfied. b. The Customs Exemption Notification required that benefit would be available when the supply of goods is made to a contractor. This condition was satisfied by the Appellant in as much as it had supplied the industrial valves to its contractor. c. The Customs Exemption Notification required submission of an undertaking by the main contractor if any of the conditions of the Customs Exemption Notification are not complied with The aforesaid undertaking has been duly provided by the Appellant in the present case. iii) On an overall basis the thrust of the CESTAT remand order was essentially to ensure that the exemption be given only to cases where goods are supplied for the intended purpose of oil exploration and thus the end use for which the exemption is intended must be met. The Hon ble CESTAT in its remand order had also observed that since substantial rights are involved the conditions in the Customs Exemption Notification cannot be read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion of law. Once the Revenue does not dispute that the assessee is a domestic manufacturer and has to satisfy only one of those conditions, particularly that the supply must be of goods in relation to contracts awarded under international competitive bidding procedure, then that condition is squarely satisfied. The condition such as Condition No.29 which pertains to an importer of the goods need not be, in the given facts, satisfied by the [domestic manufacturer] and that is the conclusion reached by the Tribunal. It is further submitted that it is a well settled principle of law that in the absence of a contrary decision by the jurisdictional High Court, it is just and proper for the Tribunals to follow the decision of the High Court. On this basis, it is submitted following the decision of the Hon ble Bombay High Court, the Appellant is not bound to satisfy the conditions as laid down under the Customs notification and is thereby entitled to the exemption from excise duty on the sole condition that the supplies are made under ICB. v) The above arguments are with respect to Appeal E/41979/2014. If the substantial issues forming part of this appeal are found in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d which has been done by the appellant onl in the case of supplies to Reliance Industries Ltd. ..... .... 20. Thus the exemption is extended in cases where the appellant is able to produce the necessary certificate as prescribed in the notification and explained above. The appellant shall produce such certificates before adjudicating authority for verification within 30 days of receipt of the order. In other cases duty demand is confirmed along with interest and penalty with option to pay 25% of the duty amount as penalty within 30 days of receipt of the order. 6.2 It is therefore evident that the remand directions of CESTAT in the said final order were in a very narrow compass. The matter was remanded to the adjudicating authority only to cause verification whether the certificates produced later meet the requirement of the notification. The said Tribunal s order also clarified that the exemption is available only in cases where necessary certificates to ensure its proper end-use is produced. Quite evidently, beyond these directions, the adjudicating authority should not have caused further tooth-combing of the matter. 6.3 We are however constrained to note th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be fulfilled, has been laid to rest by the Hon ble High Court of Bombay in the case CCE Nashik Vs Kent Introl Pvt.Ltd. - 2016 (331) ELT 77 (Bom.). The Hon ble High Court has held that such conditions of Customs notification are applicable only to the importer order and not to a domestic manufacturer. The relevant portion of the judgment is reproduced as under : 8. With the assistance of learned counsel, we have perused the memo of appeal and all annexures thereto including the relevant notification which has been reproduced at Page 11 of the paper book. Condition No. 29 is only relied upon but a bare perusal thereof would indicate that the Tribunal has held that Condition No. 29(c)(iv) is inapplicable to the assessee before it. As far as Condition No. 29(c)(i) to (iii) is concerned, the Tribunal found that all such stipulations, as are referred, have to be fulfilled by the importers of goods. These are not applicable to the [domestic manufacturer]. Upon perusal of Condition No. 29, we are satisfied that the Tribunal s factual conclusion does not raise any substantial question of law. Once the Revenue does not dispute that the assessee is a domestic manufacturer and has to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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