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2019 (4) TMI 719 - AT - Central ExciseRefund claim - duty paid on low sulphur high flash high speed diesel - petroleum products that were directly supplied by M/s Indian Oil Corporation Ltd to the Indian Navy - benefit of N/N. 64/95-CX dated 16th March 1995 - refund denied on the ground of lack of entitlement on those supplies effected to Indian Navy as the goods had been manufactured by M/s Bharat Petroleum Corporation Ltd and supplied to the appellant - Held that - It is clear that notification no. 64/95-CX dated 16th March 1995 extends the benefit of exemption to supply of stores, including fuel, to the Indian Navy for consumption on board its vessels - It is not in dispute that appellant did effect such supplies to vessels. Reliance placed in he case of INDIAN OIL CORPORATION LTD. VERSUS COMMR. OF C. EX., RAJKOT 2008 (4) TMI 160 - CESTAT AHMEDABAD , where it was held that the appellant are entitled for refund. Appeal allowed - decided in favor of appellant.
Issues: Refund of duty on 'low sulphur high flash high speed diesel' supplied to Indian Navy under exemption notification no. 64/95-CX dated 16th March 1995.
Analysis: 1. The appeal challenged the denial of refund of duty on supplies of 'low sulphur high flash high speed diesel' to Indian Navy, which was entitled to exemption under notification no. 64/95-CX. The Commissioner of Central Excise (Appeals)-II upheld the denial citing lack of entitlement due to the goods being manufactured by a different entity. The appellant failed to prove that the duty had been discharged by the manufacturer, M/s Bharat Petroleum Corporation Ltd. The Tribunal emphasized strict implementation of exemption notifications and the need for precise correlation in back-to-back supplies, as per circular no. 294/10/97-CX. The claim was rejected based on these grounds. 2. The Tribunal noted that the goods supplied to the Indian Navy were procured from M/s Bharat Petroleum Corporation Ltd, and the main issue was the appellant's inability to correlate the supply of goods with the procurement. Reference was made to a Supreme Court decision regarding ship stores and various Tribunal decisions. The appellant highlighted past orders where similar claims were allowed post facto exemption. The Tribunal differentiated the present case from previous decisions and relied on a Committee of Secretaries' decision not to allow the department to file an appeal, indicating finality of the Commissioner (Appeals) order and the intention to extend the facility to the appellant. 3. Considering the circumstances and precedents, the Tribunal set aside the impugned order and allowed the appeal, emphasizing that the supply omission was procedural and did not affect the entitlement to exemption. The decision was based on the direct supply of goods to the Navy and the consistent practice followed by the appellant over the years. The Tribunal concluded that there was no dispute regarding the exemption, and the appeal was allowed based on the specific facts of the case.
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