2009 (5) TMI 775 - AT - Central Excise

Summary

Issues involved:
The appeal against OIA No. 09/2006 dated 31st January, 2006 passed by the Commissioner of Central Excise (Appeals)-II regarding the denial of exemption under Notification No. 10/97 for imported items claimed as spare parts of scientific and technical instruments.

Issue 1: Denial of exemption under Notification No. 10/97

The lower authority confirmed a demand of Rs. 1,40,450/- against the appellant on the ground that the imported items (Switch Gears and control panels) would not be considered as spare parts of scientific and technical instruments. The Commissioner (Appeals) set aside the original order and allowed the exemption benefit to the assessee based on a similar case precedent involving controllers and switches. The Revenue cited a different case to deny the exemption notification. The Tribunal found that as long as the competent authority certified the necessity of the items in the use of scientific and technical appliances, the exemption cannot be denied. The Commissioner justified the extension of the benefit by emphasizing that the items were essential parts of main scientific equipment and were cleared to public funded research institutions with valid certificates.

Issue 2: Interpretation of Notification No. 10/97

The Tribunal analyzed the wording of the exemption notification which broadly covered scientific and technical instruments, apparatus, equipment, accessories, spare parts, and consumables. The Tribunal noted that the intention of the Government was to allow exemption to all scientific and technical equipment and their parts, accessories, and consumables as long as they were indented by specified research institutions mentioned in the notification. The Tribunal emphasized that the basic criteria for exemption were whether the items fell under the specified categories, regardless of specific mention in the notification. The Tribunal upheld the Commissioner's decision to grant the exemption based on the well-reasoned order and rejected the Revenue's appeal.

Conclusion:
The Tribunal upheld the Commissioner (Appeals)'s decision to allow the exemption benefit under Notification No. 10/97 for the imported items claimed as spare parts of scientific and technical instruments. The Tribunal emphasized the importance of certification from competent authorities and the essential nature of the items in the use of scientific and technical appliances.