2015 (11) TMI 1167 - HC - Central Excise

Benefit of serial number 91 of table annexed to Notification No.6/2006 dated 1 March 2006 - supply is not against international competitive bidding - applicant did not produce the essentiality certificate from DGHC - Held that - Condition no.29 is only relied upon but a bare perusal thereof would indicate that the Tribunal has held that Condition no.29(c)(iv) is inapplicable to the assessee before it. As far as Condition nos.29(c)(i) to (iii) are concerned, the Tribunal found that all such stipulations, as are referred, have to be fulfilled by the importers of goods. These are not applicable to the domestic importers. Upon perusal of Condition no.29, we are satisfied that the Tribunal s factual conclusion does not raise any substantial question of law. Once the Revenue does not dispute that the assessee is a domestic manufacturer and has to satisfy only one of those conditions, particularly that the supply must be of goods in relation to contracts awarded under international competitive bidding procedure, then that condition is squarely satisfied. The condition such as Condition no.29 which pertains to an importer of the goods need not be, in the given facts, satisfied by the domestic importer and that is the conclusion reached by the Tribunal - conclusion of the Tribunal cannot be termed as perverse or vitiated by any error of law apparent on the face of the record. The appeal, therefore, does not raise any substantial question of law - Decided against Revenue.

Summary

Issues:
1. Challenge to the order of Customs, Excise and Service Tax Appellate Tribunal by the Revenue.
2. Claim for exemption under Notifications No.6/2006 and No.21/2002.
3. Rejection of benefit due to non-compliance with conditions.
4. Applicability of Condition no.29 of the Customs Notification.
5. Dispute regarding conditions to be satisfied by importers and domestic manufacturers.

Analysis:
1. The appeal before the High Court challenged the Customs, Excise and Service Tax Appellate Tribunal's order dated 8 November 2013. The Assessee Applicant contested two orders of the Commissioner of Central Excise and Customs, arguing that they supplied Globe Control Valves to specific entities and claimed exemption under Notification No.6/2006. The Tribunal rejected the exemption claim due to non-compliance with conditions related to international competitive bidding and essentiality certificate from DGHC, leading to confirmed duty demands, interest, and penalties.

2. The Applicant argued before the Tribunal that they supplied goods under international competitive bidding for petroleum operations and satisfied import policy requirements. The Tribunal upheld the Applicant's contention that Condition no.29, requiring an essentiality certificate from DGHC, was not applicable to domestic manufacturers. The High Court noted that the Tribunal's factual findings did not raise any substantial legal question as the conditions relevant to importers were inapplicable to domestic manufacturers.

3. The High Court examined the relevant notifications and observed that the Tribunal correctly concluded that Condition no.29(c)(iv) did not apply to the domestic manufacturer. The Court agreed that the condition regarding goods supplied under international competitive bidding was met, and other conditions were found to be satisfied as per factual findings. The appeal was dismissed as it did not raise any substantial question of law, and the Tribunal's conclusion was deemed reasonable and not vitiated by any legal error.

4. The dispute centered on whether Condition no.29 of the Customs Notification applied to domestic manufacturers or only to importers. The High Court clarified that the condition related to importers and did not need to be fulfilled by domestic manufacturers. The Court emphasized that the Tribunal's decision was based on factual analysis and did not warrant interference as it did not involve any significant legal issue. The appeal was thus dismissed with no order as to costs.