2007 (9) TMI 499 - AT - Central Excise

Summary

Issues involved: Appeal against dropping of proceedings initiated by Show Cause Notice u/s 16-10-2003 regarding exemption under Notification dated 16th March, 1995 for goods supplied to ship builders for Indian Navy or Coast Guard.

Summary:
The Appellate Tribunal CESTAT, Bangalore heard an appeal by the Revenue against the dropping of proceedings by the Commissioner regarding the exemption under a Notification for goods supplied to ship builders for the Indian Navy or Coast Guard. The Commissioner held that the goods supplied were intended for use on board a Naval Ship, supported by certificates from Naval Authorities. The Revenue argued that the exemption only applies when goods are supplied for consumption on board a vessel. The Tribunal referred to previous decisions and held that the benefit of the Notification cannot be extended to ship builders still constructing the vessel, as the vessel must exist for the exemption to apply. The matter was remitted to the Commissioner for quantifying the duty liability. The appeal was allowed by way of remand.