2014 (7) TMI 885 - HC - Central Excise

Eligibility for duty free procurement - Notification No.1/95 CE - Furnace Oil purchased and consumed by the appellant s unit (Food Processing Industry) - tribunal allowed the he benefit of duty free purchase - Held that - a similar issue was answered against the Revenue by the Tribunal in Tata Tea Limited v. Commissioner of Central Excise, 2003 (12) TMI 109 - CESTAT, NEW DELHI , and the appeal preferred by the Department as against the said decision stood dismissed by the Supreme Court - decision of tribunal affirmed - Decided against the revenue.

Summary

Issues involved:
Interpretation of duty free procurement eligibility for Furnace Oil in Food Processing Industry.

Analysis:

1. Interpretation of Duty Free Procurement Eligibility:
The appeal was filed by the Department challenging the Final Order passed by the Customs, Excise and Service Tax Appellate Tribunal regarding the eligibility of Furnace Oil purchased and consumed by a Food Processing Industry unit for duty free purchase benefit. The substantial question of law revolved around whether Furnace Oil should be considered as raw material/consumables for the Food Processing Industry to confer upon them the benefit of duty free purchase, given that it was specifically mentioned as eligible for duty free procurement by textile units only. The learned Standing Counsel for the Revenue acknowledged a similar issue was decided against the Revenue in a previous case involving Tata Tea Limited, where the Supreme Court upheld the decision. The Supreme Court's consistent view on this matter was reiterated in various orders, leading to the present appeal being dismissed in favor of the Food Processing Industry.

2. Precedent and Supreme Court Decisions:
The judgment highlighted the significance of the Supreme Court's decisions in similar cases, particularly the Tata Tea Limited case, where the issue of duty free procurement eligibility for certain items was settled against the Revenue. The Supreme Court's stance on the matter, as evidenced by multiple orders, played a crucial role in determining the outcome of the present appeal. The consistent application of legal principles and interpretations by the Supreme Court in related cases underscored the binding nature of precedent and the importance of adhering to established legal positions.

3. Conclusion and Dismissal of Appeal:
Based on the precedent set by the Supreme Court and the consistent interpretation of the law in similar cases, the High Court concluded that the substantial question of law in the present appeal should be answered in the negative and against the Revenue. Consequently, the appeal filed by the Department challenging the Tribunal's order was dismissed, with no costs imposed. The judgment emphasized the legal principles governing duty free procurement eligibility and the authoritative role of precedent in shaping legal outcomes, ultimately leading to the resolution of the dispute in favor of the Food Processing Industry unit.