TMI Blog2023 (8) TMI 894X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the Learned Commissioner in his adjudication order has not negated the submissions made by the appellant regarding the availability of the exemptions from customs duty. Had the said goods been imported from outside India, the same would have been eligible for exemption as projects import as available under the aforesaid Notification No. 21/2002. The goods in question are classifiable under Chapter 73 of the Tariff. Under Central Excise Tariff there is no Heading 98.01 which exists in Customs Tariff only. Since the goods manufactured in India cannot be classified under Heading 98.01 of the Central Excise Tariff, denial of the exemption on the ground of non-fulfilment of condition of Project Import Regulation is not sustainable particularly when Condition No. 86 of the Notification No. 21/2002, dated 1-3-2002 is fulfilled by them - it is held that appellants are eligible for exemption under Notification 6/2006-C.E., dated 1-3-2006 and accordingly the impugned order is liable to be set aside. As it is an undisputed fact that the impugned goods were supplied and used for setting up/expansion of the Mega Power Projects through International Competitive Bidding process, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise Duty was payable on the goods that were to be supplied by the Appellants. The successful bidders M/s. BHEL subsequently in November 2008 wrote to the jurisdictional Central Excise Authorities certifying that the boiler components as would be supplied by the Appellants were required to be used for the execution of Koderma Thermal Power Project and Durgapur Steel Thermal Power Station, Steam Generator Project. The Assistant Commissioner, Central Excise Howrah West Division II vide letter dated December 23, 2008 informed that they were not entitled to exemption under Notification No. 6/2006-CE dated March 1st, 2006 as condition No. 19 under Serial No. 91 of the notification were not fulfilled. BHEL also further wrote to the authorities stating that the boiler components supplied by the Appellants were required for the execution of Koderma Thermal Power Project and Durgapur Steel Thermal Power Station Stream Generator Project and therefore, the Appellant would be exempted from payment of Excise Duty in respect of the good supplied. 3. The Appellant further vide their letter dated December 29, 2008 wrote as under to the Assistant Commissioner in respect of the referenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant. f) Technological structures and chutes which will be supplied for execution of the Simhadri State II (1000MW) Thermal Power Project will be used for erecting coal handling plant and hence, will fall under heading 98.01 of the Customs Tariff Act, 1975 and will be exempted from the duties of customs leviable under the First Schedule to the Customs Tariff Act, 1975 and the additional duty leviable under Section 3 of the Customs Tariff Act, 1975 when imported into India. Therefore, the appellant would be entitled to the benefit of Notification No. 6/2006-CE dated March 1, 2006. They thus submitted that the Appellant should be allowed to remove the goods at NIL rate of duty. It was their case that unless domestic suppliers were permitted to remove the goods to be utilized in Mega Power Projects at NIL rate of duty, the domestic suppliers would not find it viable to supply the goods to Mega Power Projects and such good will be required to be imported leading to outflow of foreign exchange. 4. The aforesaid contentions of the Appellant were not accepted by the department and a show cause-cum-demand notice was issued to the Appellants for the period November ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r sub-heading 9801 of the Customs Tariff Act, 1975 and would be subjected to project rate of duty. The Ministry of Power, Government of India had certified the Simhadri Super Thermal Power Project, Stage II (2 500MW) as fulfilling the criteria laid down for Mega Power Project, hence the good supplied were eligible for exemption benefit. They further contend that the supplies made by them were considerable as deemed exports , in terms of paragraph 8.2(g)/8.2(f) read with paragraph 8.4.4 and 8.6.2 of the Foreign Trade Policy 2004-09, as they satisfied all conditions thereto. Thus no duty as demanded under Section 11(A)(1) of the Central Excise Act, was payable and accordingly no interest or penalty was also leviable. 6. As for the second Show Cause Notice issued for the period September 1st, 2009 to October 31st, 2009 demanding Central Excise of Duty to Rs. 1,81,562, alongwith interest and penalty the noticee adopted similar arguments. In short it is their case that they were eligible for exemption from payment of duty for goods supplied to the Mega Power Projects as they constituted machinery or equipment parts or components of the said Mega Power Project, within the meaning of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We find that in the same set of facts came up for decision before this Tribunal in earlier cases. In Sarita Steels and Industries Ltd. v. CCE vide Final Orders Nos. 1076-1081/2010, dated 15-7-2010 [2011 (264) E.L.T. 313 (Tribunal)], the Tribunal held that when the fact that supplies are made to mega power projects and all the conditions have been fulfilled the goods which are required for execution of mega power project are categorically exempted by the said customs notification. So in Om Metals SPML JV Unit 2 v. CCE ST, Jaipur - 2013 (298) E.L.T. 79 (Tri.-Del.), the Tribunal held that there is no Heading 9801 in Central Excise Tariff which is only in Customs Tariff. The goods manufactured in India cannot be classified under 9801, accordingly, denial of exemption on that ground is not tenable. Further, the Tribunal in Paramount Communications Limited vide Final Order dated 23-6-2016 examined the very same issue and held the denial of exemption on the ground of classification shown under Customs Notification is 9801, is not sustainable. The same ratio has been followed by the Tribunal in KEI Industries Limited vide Final Order No. 52371/2016, dated 1-7-2016. 6. In view of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exemption on the ground of non-fulfilment of condition of Project Import Regulation is not sustainable particularly when Condition No. 86 of the Notification No. 21/2002, dated 1-3- 2002 is fulfilled by them. Similar submissions were made by Revenue for denying the benefit of Notification 6/2006-C.E., dated 1-3-2006 on the ground of non-fulfilment of conditions of the Project Import Regulation in case of Sarita Steels and Industries Ltd. reported in [2011 (264) E.L.T. 313] and Tribunal in that case allowed the exemption under Notification 6/2006-C.E., dated 1-3-2006 to the assessee. Reference can be made to another decision of the Tribunal in the case of Om Metals SPML JV Unit 2 v. CCE, Jaipur as reported in [2013 (298) E.L.T. 79 (Tri.-Del.)]. We, therefore, hold that appellants are eligible for exemption under Notification No. 6/2006-C.E., dated 1-3-2006 and accordingly set aside the impugned order and allow the appeal. 11. We further, note that the entries in the Excise exemption Notification as availed by the assessee appellant in column No. (2) for reference of Chapter or heading specifically states Any Chapter , which clearly implies that goods sought to be cleared ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pacity of 1000 MW or more; or (b) an inter-State hydel power plant of 500 MW or more, as certified by an officer not below the rank of a Joint Secretary to the Government of India in the Ministry of Power. Nil Nil 86 The exemption against S. No. 400 is subject to Condition 86 which reads as under : (a) If an officer not below the rank of a Joint Secretary to the Government of India in the Ministry of Power certifies that - (i) The power purchasing State has constituted the Regulatory Commission with full powers to fix tariffs; (ii) The power purchasing State undertakes, in principle, to privatize in distribution in all cities, in that State, each of which has a population of more than one million, within a period to be fixed by the Ministry of Power; and (iii) The power purchasing State has agreed to provide recourse to that State s share of Central Plan allocations and other devolutions towards discharge of any outstanding payment in respect of purchase of power; (b) In the case of imports by a Central Public Sector undertaking, the quantity, total value, description and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption under Notification 6/2006-C.E., dated 1-3-2006 and accordingly the impugned order is liable to be set aside. 15. We further note that the Learned Commissioner has also noted that goods must be unconditionally exempted under Notification No. 21/2002-Cus. (Project Imports) when imported into India. We are of the view that the Learned Commissioner has attempted to examine the fulfilment of a condition which is not appearing in the subject excise Notification. We observe that the only condition is that goods are cleared under International Competitive Bidding for use in the specified Mega Power Projects which are exempted from customs duty. The supply of subject goods in the instant case for Mega Power Project under International Competitive Bidding is on record and not in dispute. The Appellant is legally entitled to exemption from payment of Central Excise duty and thus the duty demand is not sustainable. 16. As it is an undisputed fact that the impugned goods were supplied and used for setting up/expansion of the Mega Power Projects through International Competitive Bidding process, therefore in view of our above discussions and relying on the slew of cases some of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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