2014 (3) TMI 274 - AT - Central Excise

End use based exemption - Notification No. 10/97-C.E. - Whether impugned goods are spare parts or accessories of the scientific and technical instruments/apparatus - end use certificate - Duty demand - Imposition of interest and equivalent penalty - Held that - Appellant produced end-use certificates to the effect that the impugned goods are used as parts/accessories scientific and technical instruments/apparatus for example certificate dated 7-5-2008 issued by BARC certifying that pipes/tubes are used as parts/accessories and used for setting up of pickling and passivation plant and installation of ventury scrubber system. Similarly the other certificates are also to the same effect - appellant has produced the required certificates to the effect that the goods in question are accessories and spare parts of scientific and technical instruments/apparatus/equipment - Decided in favour of assessee.

Summary

Issues:
Appeal against order confirming demand and penalty, Benefit of Notification No. 10/97-C.E. denied, Interpretation of Notification conditions.

Analysis:

Issue 1: Appeal against order confirming demand and penalty
The appellant filed an appeal against the order passed by the Commissioner of Central Excise confirming a demand of Rs. 1,03,61,856/- with interest and imposing a penalty of the same amount. The demand was confirmed after denying the benefit of Notification No. 10/97-C.E.

Issue 2: Benefit of Notification No. 10/97-C.E. denied
The appellant contended that the impugned order was passed following a remand order by the Tribunal to re-decide the issue regarding the benefit of the Notification. The appellant produced certificates from public funded research institutions certifying that the goods in question are used as parts and spares of scientific and technical instruments/apparatus. However, the adjudicating authority denied the benefit of the Notification, stating that the certificates did not explicitly mention the goods as spare parts or accessories.

Issue 3: Interpretation of Notification conditions
The dispute revolved around the interpretation of Notification No. 10/97-C.E., which exempts specified goods supplied to specified institutions from excise duty. The Notification specifies conditions, including the requirement for certificates from the head of the institution certifying the specified use of the goods. In this case, the appellant produced certificates indicating the use of the goods as parts and accessories of scientific and technical instruments/apparatus.

Conclusion:
The Tribunal found merit in the appellant's contention as they had produced certificates confirming the use of the goods as accessories and spare parts of scientific and technical instruments. As per the conditions of the Notification, the certificates provided by the appellant sufficed to establish eligibility for the benefit of the exemption. Consequently, the impugned order was set aside, and the appeal was allowed.