2016 (12) TMI 275 - AT - Central Excise

Cement - benefit of concessional rate of duty in terms of Sl. No. 1C in Notification No. 4/2007-CE dated 01.03.2007 - benefit denied on the ground that certain clearances made to institutional consumers - individuals schools educational institutions hospitals co-operative societies malls government department public sector undertaking industrial consumers etc - Held that - First of all the Revenue has not produced any evidence regarding the decision of Hon ble High Court or Hon ble Supreme Court overruling the Tribunal decision in Grasim Industries 2008 (10) TMI 462 - CESTAT CHENNAI . Further it is not correct for the Revenue to say that the circular will be applicable only to some portion of the country and should not be relied upon by others. Even otherwise we find that the original order as far as it relates to extending benefit to the respondent-assessee with reference to the clearance of cement to institutional buyers we find no merit in the present appeal to interfere with the same. It may be noted here that in terms of Rule 2(q) of Packaged Commodity Rules 1977 to qualify as a retail sale such sale of any commodity should be through an intermediary to an ultimate consumer. In the present case the sales made directly to various actual users will not be covered by the category of retail sale . On this ground also we find the appeal by Revenue has no merit. Accordingly the same is rejected - decided against Revenue.

Summary

Issues:
1. Claim of concessional rate of duty for clearances made to institutional consumers.
2. Applicability of Board Circular and Tribunal decision in determining duty liability.
3. Interpretation of "retail sale" under Packaged Commodity Rules, 1977.

Analysis:
1. The appeal by Revenue challenged the order of the Commissioner of Central Excise regarding the claim of concessional rate of duty by the respondent for clearances made to institutional consumers. The original authority confirmed a demand for a certain amount but dropped the demand for the remaining amount. The Revenue contended that the original authority erred in relying on a Board Circular and a Tribunal decision, arguing that they should not be considered. However, the Tribunal found no merit in the Revenue's appeal and rejected it, stating that the sales made directly to various actual users, including institutional buyers, do not qualify as "retail sale" under Rule 2(q) of the Packaged Commodity Rules, 1977.

2. The Revenue's grounds of appeal were based on the argument that the Board Circular and the Tribunal decision should not be relied upon. The Revenue claimed that the circular was meant for specific regions and that the decision of the Tribunal had not been accepted by the department, with an appeal filed before the Supreme Court. However, the Tribunal found that the Revenue failed to provide evidence of any High Court or Supreme Court decision overruling the Tribunal decision. The Tribunal also noted that the circular cannot be limited to specific regions and that the original order extending benefits to the respondent for clearances to institutional buyers was justified.

3. The Tribunal's analysis focused on the interpretation of the term "retail sale" under the Packaged Commodity Rules, 1977. It emphasized that for a sale to qualify as a retail sale, it should be through an intermediary to an ultimate consumer. In this case, where the respondent directly supplied cement to various entities like schools, hospitals, and government departments, the sales did not meet the criteria of "retail sale." Therefore, the Tribunal concluded that the Revenue's appeal had no merit based on this interpretation. The Tribunal's decision to reject the Revenue's appeal was pronounced on 28.09.2016.