2018 (6) TMI 978 - AT - Central Excise

Benefit of N/N. 6/2002-CE Sr. No. 196A - denial on the ground that the pipes are used for transportation of treated water from one storage point to another storage point, which is not covered under the ambit of the notification - Held that - Tribunal in the case of IVRCL Infrastructures & Projects Ltd. 2008 (12) TMI 198 - CESTAT, BANGALORE , has been held that Notification is available for supply of water from one storage point to another - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against confirmation of demand and imposition of penalty under Notification No. 6/2002-CE Sr. No. 196A for exemption on Pre-stressed Concrete Pipes used in water treatment plants.

Analysis:
The appellants, engaged in manufacturing Pre-stressed Concrete Pipes, claimed exemption under Notification No. 6/2002-CE Sr. No. 196A for setting up water treatment plants for human and animal consumption. The dispute arose as the impugned order denied the benefit, stating the pipes were used for transporting treated water between storage points, not covered by the notification. The appellant relied on a Tribunal decision and a subsequent Apex Court ruling supporting the exemption for water supply beyond the first storage point.

The Tribunal referred to a previous case where it was held that the exemption notification applies to pipes needed beyond the first storage point for water delivery. The Tribunal emphasized that the unamended notification did not restrict water delivery to the first storage point only. It concluded that the exemption covers pipes delivering water to subsequent storage points, like elevated reservoirs for further treatment. The Tribunal criticized the Department for restricting clearance without following due process, allowing the appeal against such communication.

The Tribunal dismissed the Revenue's appeals, upholding the decision that the exemption cannot be limited to the first storage point. It concurred with the Kolkata Bench's ruling on a similar issue. The Tribunal found no merit in the Revenue's appeals and allowed the appellants' appeals, aligning with the Kolkata Bench's interpretation. The Apex Court also upheld this decision.

In conclusion, the Tribunal allowed the appeals, finding merit in the appellants' argument based on the interpretation of the exemption notification. The decision was pronounced in court, granting relief to the appellants against the demand and penalty imposed.