2008 (9) TMI 167 - AT - Central Excise

Eligibility of Automatic Voltage Stabilizers (AVS) to concessional rate of duty u/not. 5/98 notification provides exemption to All goods other than programmable process controllers (PPC) - respondents submits that AVS are not PPC - Directorate of Telecommunication letter clarified that servo controlled voltage stabilizers were not PPC, and Exim Policy classified AVS and PPC separately it shows that AVS were different from PPC revenue appeal dismissed impugned order upheld

Summary

Issues:
Eligibility of Automatic Voltage Stabilizers (AVS) for concessional effective rate of duty under Notification No. 5/98 dated 2-6-98.

Analysis:
The appeals before the Appellate Tribunal arose from the High Court setting aside a previous order rejecting the respondent's application to recall a final order allowing revenue appeals against the decision of the Commissioner (A) regarding the eligibility of automatic voltage stabilizers for exemption under Sl. No. 255 of Notification No. 5/98. The main issue revolved around whether AVS qualified for the concessional effective rate of duty as per the said notification.

The notification in question, under Sl. No. 255, provided an exemption for "All goods other than programmable process controllers" at a specific rate of duty. The Commissioner (A) had based his decision on opinions obtained from the Bureau of Indian Standards and other experts, contending that AVS did not fall under the category of programmable process controllers as defined in the notification.

The respondent's counsel argued that AVS, unlike Programmable Process Controllers (PPC), did not have the capability to regulate and supply electrical quantities automatically for a programmed length of time. AVS primarily functioned to raise or step down voltage to a prefixed level without the ability to program future performance. The counsel highlighted the distinction between AVS and PPC based on the explanation provided in the notification.

Upon considering the submissions from both sides, the Tribunal reviewed the Commissioner (A)'s reliance on expert opinions and literature to determine the classification of AVS. The Tribunal noted that the Commissioner (A) had appropriately interpreted the notification and the distinction between AVS and PPC. The Tribunal found no substantial grounds presented by the Revenue to challenge the classification of AVS as non-PPC. Consequently, the Tribunal upheld the Commissioner (A)'s decision, dismissing the appeal filed by the Revenue and affirming the eligibility of AVS for the concessional effective rate of duty under the notification.

This detailed analysis of the judgment provides a comprehensive overview of the legal issues, arguments presented by both parties, and the Tribunal's reasoning leading to the final decision regarding the eligibility of Automatic Voltage Stabilizers for the concessional effective rate of duty under the relevant notification.