2017 (4) TMI 327 - AT - Central Excise

Benefit of N/N. 108/95, dated 28-8-95 - denial on the ground that at the time of clearance, the respondent was not having valid and proper certificate as per notification - Held that - the substantial benefit cannot be denied on the basis of procedural irregularity, if any - In the present case, the certificates were signed by the Executive Head of the Project Implementing Authority and countersigned by the Principal Secretary. The same is not in dispute. The submission of proper certificate subsequently cannot be brushed aside and the substantial benefit cannot be denied on technical ground - appeal dismissed - decided against Revenue.

Summary

Issues:
Exemption under Notification No. 108/95 for goods supplied to UN or International Organization - Validity of certificate for exemption - Denial of exemption by Original Authority - Appeal by Revenue against Commissioner (Appeals) order.

Analysis:
The case involved a dispute regarding the exemption claimed by the respondent under Notification No. 108/95 for goods supplied to approved projects. The Original Authority denied the exemption on the grounds of the respondent not having a valid certificate at the time of clearance, resulting in duty demand and penalty. On appeal, the Commissioner (Appeals) set aside the original order, acknowledging that the respondent procured the proper certificate before the show cause notice was issued. The Commissioner emphasized that the substantial benefit should not be denied due to procedural irregularities. The certificates, signed by the Executive Head of the Project Implementing Authority and countersigned by the Principal Secretary, were found to be in order. The Appellate Tribunal agreed with the Commissioner's findings, stating that the subsequent submission of a proper certificate should not be disregarded, and the substantial benefit cannot be denied on technical grounds. The Tribunal dismissed the Revenue's appeal, highlighting that the amendment to the certificate does not justify denying the exemption available to the respondent.

This judgment underscores the importance of complying with procedural requirements for claiming exemptions under specific notifications. It clarifies that substantial benefits should not be denied based solely on technical irregularities if the essential conditions are met. The decision emphasizes the significance of proper documentation and timely submission of certificates to avail exemptions effectively. The Tribunal's ruling prioritizes substance over form, ensuring that legitimate benefits are not withheld due to minor procedural lapses. The judgment serves as a reminder for authorities to consider the overall compliance and substantial fulfillment of conditions while adjudicating matters related to tax exemptions.