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Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2023 (5) TMI AT This

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2023 (5) TMI 327 - AT - Central Excise


Issues Involved:
1. Denial of exemption benefit under Notification No. 108/95-CE.
2. Validity of certificates issued by the Project Implementing Authority.
3. Extension of validity period of certificates.
4. Imposition of penalty and interest.

Summary:

1. Denial of exemption benefit under Notification No. 108/95-CE:
The appellant cleared goods by availing exemption under Notification No. 108/95-CE. The Commissioner demanded duty, arguing that the goods were supplied to contractors or subcontractors, not directly to the Project Implementation Authority (PIA), and the certificates were not countersigned as required. The Tribunal found that the goods were indeed supplied to projects funded by international organizations and used as intended. The Tribunal held that the benefit of exemption cannot be denied on technical grounds and cited the case of Auro Laboratories [2016 (344) ELT 391 (T)].

2. Validity of certificates issued by the Project Implementing Authority:
The Commissioner argued that certificates issued by the PIA were not countersigned by the Principal Secretary, making them invalid. The Tribunal noted that the certificates were issued by the Project Development Authorities and countersigned by the Principal Secretary of the respective states. The Tribunal found that the appellant fulfilled the conditions of the notification and was entitled to the benefit of the exemption, supported by various Tribunal decisions and Board Circular F.No.101/7/2008-CX-3 dated 12.6.2008.

3. Extension of validity period of certificates:
The Commissioner contended that the extension of the validity period of certificates by the Project Director was not authorized by the Principal Secretary, making the extensions invalid. The Tribunal found that the Project Director was authorized by the Chhattisgarh Government to issue revised technical acceptances. However, the Tribunal noted that the authorization dated 04.11.2011 could not be applied retrospectively to clearances made between 20.04.2007 and 31.01.2011. Thus, the Tribunal upheld the demand for the period where the validity extension was not countersigned by the Principal Secretary.

4. Imposition of penalty and interest:
The Tribunal emphasized that exemption notifications should be interpreted strictly according to their terms without adding conditions. The Tribunal relied on decisions from the Hon'ble Apex Court, including Uttam Industries [2011 (265) ELT 14 (SC)] and M. Ambalal & Co. [2010 (260) ELT 487 (SC)], which held that exemption notifications must be interpreted strictly and any procedural infirmities should not lead to denial of benefits. Consequently, the Tribunal set aside the impugned order and allowed the appeal.

Conclusion:
The Tribunal allowed the appeal, setting aside the impugned order, and held that the appellant was entitled to the benefit of exemption under Notification No. 108/95-CE. The Tribunal emphasized the need for strict interpretation of exemption notifications and found no merit in the Commissioner's order.

 

 

 

 

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