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2017 (2) TMI 100 - AT - Central ExciseExemption under N/N. 6/2000 dated 1-3-2000 - whether M.S. Forged Flanges, as parts/spares of the wind mill tower manufactured and supplied by appellant is eligible for exemption N/N. 6/2000 dated 1-3-2000 as non-conventional energy devices/ systems? Held that - the issue is no longer res integra as in respondent s own case PUSHPAM FORGING Versus COMMISSIONER OF CENTRAL EXCISE, RAIGAD 2005 (7) TMI 242 - CESTAT, MUMBAI , the issue has been decided by this Tribunal and the same was upheld by the Apex Court, where it was held that the flange being part of tower which is Essential Component of Wind Operated Electrical Generator, an unconventional energy service device, would be eligible under Sr. No. 5 if not under 20 as part of Sr. No. 1 to 19. Coverage is also to be available under Sr. No. 13 of list 5. The appellant is entitle for the exemption under N/N. 6/2000-CE in respect of their product namely M.S. Forged Flanges as parts/ spares of the wind mill tower - appeal allowed - decided in favor of appellant-assessee.
Issues involved: Whether M.S. Forged Flanges, as parts/spares of the wind mill tower, are eligible for exemption under Notification No. 6/2000 dated 1-3-2000 as non-conventional energy devices/systems.
Comprehensive Analysis: Issue 1: Eligibility for Exemption The Tribunal considered whether M.S. Forged Flanges qualify for exemption under Notification No. 6/2000-CE. The Respondent argued that a previous decision in a similar case had been upheld by the Supreme Court, establishing a precedent. The Tribunal referenced the case law and held that M.S. Flanges are parts of a Wind Mill Tower, which is an Essential Component of a Wind Operated Electrical Generator (WOEG), an unconventional energy service device. The Tribunal found that the flanges were essential parts of the tower, necessary for the generation of electricity from unconventional sources. The Tribunal also noted that the consumption of flanges at the site during tower assembly did not disqualify them from exemption. Issue 2: Interpretation of "Consumed in Factory of Production" The Tribunal rejected the argument that flanges were not consumed in the factory of production for the manufacture of the tower, emphasizing that the tower only came into existence at the site after assembly using the flanges. The concept of restricting consumption to the factory premises was deemed untenable, as the tower's construction involved the use of flanges at the assembly site. The Tribunal concluded that the flanges, being part of the tower, qualified for exemption under relevant provisions. Issue 3: Classification and Exemption Claim The Tribunal examined the classification declarations filed by the appellant, which claimed exemption under specific serial numbers related to wind mills and spares. The Tribunal noted that the appellant's belief in the product's classification was well-founded, as supported by relevant circulars. The Tribunal found no suppression of facts that would disentitle the appellant from the exemption claim. Consequently, the Tribunal set aside any demands for duty, penalty, or interest, ruling in favor of the appellant. Final Decision Based on the precedent set by previous cases and the specific characteristics of the M.S. Forged Flanges as integral components of wind mill towers, the Tribunal allowed the appeal, upholding the appellant's entitlement to exemption under Notification No. 6/2000-CE. The Tribunal dismissed the appeal of the Revenue, affirming the exemption status of the flanges. The judgment was pronounced in court on 05/01/2017, marking the conclusion of the legal proceedings.
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