2016 (3) TMI 437 - AT - Central Excise

Exemption u/s Notification 10/97 dated 01.09.1997 on Air conditioning unit, condensing unit, chillers, walk in cold rooms - Held that - Notification 10/97 dated 01.03.1997 grants exemption to certain goods supplied to specific research institutions, provided the institution is a public funded research institution and the goods should be scientific and technical apparatus including computer for research purposes. Apart from this, the institution has to be registered with the Government of India, Department of Scientific and Industrial Research and an officer, not below the rank of Dy. Secretary to the Govt. of India has to certify that the institution is not engaged in commercial activity and the goods are required for research purposes. Further, in this case the respondent has produced the required certificate to claim benefit of Notification 10/97 dated 01.03.1997. The only ground for denial is that the impugned goods are used for the general purposes and are not attached to any scientific instrument and therefore not eligible for exemption. We also find that the respondent has complied with the Notification 10/97 dated 01.03.1997; therefore we do not find any infirmity with the impugned orders and the same are upheld. - Decided in favour of assessee

Summary

Issues:
- Exemption under Notification 10/97 dated 01.09.1997 on air conditioning units, condensing units, chillers, and walk-in cold rooms supplied to DRDO.
- Whether the goods qualify as scientific and technical apparatus for research purposes.
- Compliance with the conditions of Notification 10/97 dated 01.03.1997.

Analysis:
The appeal was filed by the Revenue against the order passed by the Commissioner (Appeals) granting exemption to the respondent under Notification 10/97 dated 01.09.1997 on specific goods supplied to DRDO, a registered research institute. The respondent, engaged in manufacturing air conditioning and refrigerator appliances, faced show-cause notices demanding excise duty for goods supplied to DRDO. The adjudication confirmed the demand partially, allowing exemption on certain goods. Both parties appealed the decision, leading to the Commissioner (Appeals) allowing the respondent's appeal and dismissing the Revenue's appeal. The Revenue then appealed to the Appellate Tribunal.

The Revenue contended that the goods in question, including condensing units, chillers, and walk-in cold rooms, were not exclusively used for research purposes and therefore not eligible for exemption under Notification 10/97 dated 01.03.1997. They argued that the goods were used for general purposes within the respondent's premises and not linked to any specific scientific or technical apparatus. On the other hand, the respondent's counsel argued that previous Tribunal decisions supported their eligibility for exemption under the Notification as long as all conditions were met.

Upon review, the Tribunal noted that Notification 10/97 dated 01.03.1997 required goods to be supplied to specific research institutions for research purposes, with certification from the Department of Scientific and Industrial Research. The respondent had provided the necessary certificate, meeting the conditions of the Notification. The Tribunal found that the goods were used for research purposes and upheld the Commissioner (Appeals)'s decision. Citing previous Tribunal decisions, the Tribunal concluded that the respondent had fulfilled all requirements of the Notification and dismissed the Revenue's appeal.

In conclusion, the Tribunal upheld the exemption under Notification 10/97 dated 01.03.1997 for the goods supplied to DRDO, as the respondent had complied with the conditions, and the goods were considered eligible for research purposes. The appeal of the Revenue was consequently dismissed.