2006 (1) TMI 351 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notification No. 63/95-C.E. regarding exemption for goods supplied to Ministry of Defence.
2. Requirement of end use certificate from Ministry of Defence for availing benefit under the Notification.
3. Eligibility of supplies made by job workers under contracts for the benefit of the Notification.

Analysis:
1. The case involved the interpretation of Notification No. 63/95-C.E. which grants benefits for goods supplied to the Ministry of Defence. The appellant, a PSU unit, claimed the benefit under this Notification for supplying Scientific and Defence Equipment to the Ministry of Defence. The authorities denied the benefit citing lack of direct clearance to the Ministry of Defence and absence of end use certificates. The appellant argued that the Notification does not mandate end use certificates and that clearance to the Ministry of Defence should suffice. The Tribunal noted that the goods were indeed for defence purposes, invoices indicated clearance to the Ministry of Defence, and an end use certificate was produced. The Tribunal found the denial of benefit by the authorities to be incorrect and set aside the Commissioner's order, emphasizing the lack of proper application of mind by Revenue officials.

2. The issue of requiring an end use certificate from the Ministry of Defence for availing benefits under the Notification was crucial in this case. The Tribunal observed that the Notification itself did not impose such a condition. The goods in question were clearly intended for defence purposes, and the appellant had taken precautionary measures by obtaining an end use certificate from the Asstt. Commissioner regarding the utilization of the goods in defence equipment manufacture. The Tribunal found it perplexing that Revenue officials disregarded these aspects and rejected the benefit based on unfounded reasons. Ultimately, the Tribunal held that the Commissioner's order was legally incorrect and set it aside, emphasizing the specific issuance of the Notification to the appellant for supplying goods to the Ministry of Defence.

3. Additionally, the eligibility of supplies made by job workers under contracts for the benefit of the Notification was raised by the appellant. Citing relevant judgments, the appellant argued that such supplies should also qualify for the exemption under the Notification. The Tribunal did not delve deeply into this aspect in the detailed analysis provided but mentioned that the learned SDR conceded the position on this matter. While the Tribunal did not provide an extensive discussion on this issue, it can be inferred that the Tribunal's decision to set aside the Commissioner's order encompassed all aspects raised by the appellant, including the eligibility of supplies made by job workers for the benefit of the Notification.