2011 (9) TMI 504 - HC - Central Excise

Interpretation of term site used in Notification No. 01/201 - Intermediate goods manufactured transferred to the site for utilization thereof in elevated viaduct or tunnel - Held That - site should not be given restrictive meaning and would include any premises made available to the manufacturer of goods falling under the Central Excise Tariff Act. As application of beams/girders is concerned that may not be necessarily be at the site as that may cause many traffic problems etc. Decided in favour of assessee.

Summary

Issues:
1. Whether the respondents are liable to pay excise duty for supplying prefabricated structural components to Delhi Metro Rail Corporation Limited (DMRC) without the required registration certificate?
2. Whether the supplies made by the respondents are exempted from excise duty under Notification no. 01/2011-CE(N.T.) dated 17.02.2011?
3. Whether the goods supplied by the respondents fulfill the conditions of being manufactured at the site of construction for use in construction work at such site as per the notification?

Analysis:
1. The respondents supplied prefabricated structural components to DMRC without the necessary registration certificate under the Central Excise Act, leading to a show cause notice for non-payment of excise duty. The adjudicating authority ordered the payment of duty, interest, and penalty, which was challenged by the respondent in appeal.

2. The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the respondent's appeal, citing that the supplies were exempted under Notification no. 01/2011-CE(N.T.) dated 17.02.2011, applicable to goods manufactured at the site of construction for use in construction work at the same site. The Tribunal concluded that the excise duty was not required to be paid based on this notification.

3. The Revenue contended that to be eligible for exemption under the said Notification, two conditions must be met: the goods should be manufactured at the site and used in construction work at the same site. While there was no dispute regarding the usage of goods at the construction site, the question of whether the goods were manufactured at the site was raised.

4. The respondent argued that Circular No. 456/22/99-CX clarified that the expression 'site' should not be narrowly interpreted and could include premises provided to the manufacturer for goods falling under the Central Excise Tariff Act. The circular highlighted instances where manufacturing off-site was necessary due to practical issues like traffic disruptions.

5. The Court found that both conditions stipulated in the Circular were satisfied by the respondents, thereby entitling them to exemption under the Notification. It was concluded that the Tribunal's decision was appropriate, and no legal questions arose in the case. Consequently, the appeals were dismissed.