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TMI Blog2019 (5) TMI 205X X X X Extracts X X X X X X X X Extracts X X X X ..... ntical, both appeals are being taken up together for discussion and disposal. 2. Vide order dt. 05/01/2012, the Commissioner of Central Excise, Bangalore confirmed demand for Rs. 5,28,05,225/- under Section 11A of Central Excise Act, 1944 along with interest and also imposed penalty of Rs. 5 lakhs under Rule 15 of Central Excise Rules, 2002 for the period October 2010 to March 2011. For the subsequent period from April 2011 to December 2011, the Commissioner has dropped the demand of Rs. 2,61,64,504/- by holding that the assessee is entitled to the exemption Notification No.64/1995-CE dt. 16/03/1995 as amended. For the sake of convenience, we take up the assessee's appeal first. 3. The facts of the case are that the assessee/appellant i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not paid on account of wrong availment of Notification worked out to Rs. 5,28,05,225/- and the same is recoverable from the appellant under Section 11A(1) of the Central Excise Act. The Department has also alleged that the appellant has contravened the provisions of Rule 4 and 8 of Central Excise Rules, 2002 and thus rendered themselves liable to penalty under Rule 25 of the Central Excise Rules, 2002. After following the due process, the learned Commissioner confirmed the demand along with interest and also imposed penalty of Rs. 5 lakhs under Rule 25 of the Central Excise Rules, 2002. 4. Heard both sides and perused records. 5. Learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the exemption is applicable to all goods supplied for use in construction of warships of the Indian Navy and the only condition stipulated was that before clearance of the said goods, a certificate from an officer not below the rank of a Rear Admiral of the Indian Navy or of any other officer of the Indian Navy equivalent to the Joint Secretary to the Government of India, to the effect that the said goods are intended for the said use, is produced to the proper officer. He further submitted that the appellant has produced such certificates to the Deparmtnet vide their letter dt. 04/11/2010 and there is no dispute on this. He also submitted that the wordings in the notification are very clear and it did not stipulate that the goods sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption under Notification No.64/95 dt. 16/03/1995. He also submitted that exemption notifications have to be strictly construed. 7. After considering the submissions of both the parties and perusal of the material on record, we find that in the first instance, the case of Leader Engineering Works relied upon by the Revenue in the show-cause notice is not applicable in the facts and circumstances of the case because in the said case emphasis laid is regarding the goods supplied for consumption on board a vessel of Indian Navy and has nothing to do with goods supplied for construction of war ships. Further we find that this case law relates to the law as existing prior to 11/04/2002. The said notification was amended vide Notification N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p(s) of Indian Navy only. In this regard, the appellant has got the certificate from the Competent Authority namely Rear Admiral of Indian Navy which is the second condition of the Notification against Sl. No. 21. In this Notification, it is nowhere mentioned that goods were to be directly supplied to Indian Navy. When the goods are being supplied to MDL which was using them for construction of warships of Indian Navy, it is very clear that conditions of the Notification against Sl. No. 21 have been complied with and the subject goods are entitled to the benefit of subject notification namely 64/95-C.E., dated 16-3-1995. It is to be noted that Hon'ble Apex Court in the case of Leader Engineering Works (supra) on which reliance was placed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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