2018 (3) TMI 1741 - AT - Central Excise

Clearance of goods to institutional/industrial consumers - benefit in terms of SI. No. 1C of N/N. 04/2006 dated 01/03/2006 and Entry 52 of the N/N. 12/2012-CE dated 17/03/2012 - Held that - The builder and construction companies qualify as institutional/industrial consumers hence the benefit of the said Notifications would be available to the assessee - Appeal allowed - decided in favor of appellant.

Summary

Issues:
Entitlement of benefit under SI. No. 1C of Notification No.04/2006 and Entry 52 of Notification No.12/2012-CE.

Analysis:
The case involved an appeal by M/s Jaypee Sikandrabad Cement Grinding Unit against an order passed by the Commissioner, Customs, Central Excise & Service Tax, Noida. The main issue revolved around determining the entitlement of benefit under SI. No. 1C of Notification No.04/2006 and Entry 52 of Notification No.12/2012-CE. The appellant, a manufacturer of cement, claimed concessional duty rates by treating their goods as 'other than those cleared in packaged form' for sale to institutional/industrial consumers marked as 'Not for Retail Sale'. The dispute arose when show cause notices were issued proposing to deny the benefit under the said Notifications, arguing that construction companies did not qualify as institutional/industrial consumers, thus requiring the appellant to declare retail prices on the bags. The Adjudicating Authority upheld the demands, leading to the appeal.

The appellant contended that their clearance of cement to construction companies satisfied the conditions of the Notifications as goods 'other than those cleared in packaged form'. They argued that since the goods were sold to industrial/institutional consumers not requiring price declaration under standards, they were eligible for the benefit. The appellant referenced SWMPC Rules and LMPC Rules to support their position, emphasizing the non-applicability of retail sale price declaration rules for goods meant for industrial use or institutional consumers. They relied on precedents where similar situations were considered, such as Commissioner of Central Excise & Customs, Raipur vs. Lafarge India Pvt. Ltd. and Ultratech Cement Ltd. vs. CCE, Indore, where the benefit under the Notifications was allowed for sales to builders and construction companies.

After considering the arguments and case laws cited, the Tribunal found that builder and construction companies qualified as institutional/industrial consumers, thereby entitling the appellant to the benefit under the Notifications. The impugned order was set aside, and the appeal was allowed, granting the appellant consequential benefits as per the law. The decision highlighted the importance of correctly categorizing buyers as industrial/institutional consumers to determine eligibility for duty benefits under specific Notifications.