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2019 (5) TMI 912 - AT - Central ExciseSupply of goods against international competitive bidding - seamless pipes - benefit of N/N. 6/2006-C.E., dt.1.3.2006 - denial of benefit on the ground that the goods were not supplied directly to the contractor - HELD THAT - There is no dispute of the fact that the main contractor M/s HJIPL has supplied the goods against international competitive bidding to M/s Jubilant Oil Gas Ltd in respect of oil exploration of Cauveri block. The project authority certificate was issued in the name of M/s HJIPL, who in turn, procured the material from the Appellant, on the strength of the said project authority certificate. The quantity and quality of seamless pipes mentioned in the said project authority certificate has been undisputedly supplied by the Appellant to M/s HJIPL. The sole reason for denying the benefit of said exemption to the Appellant is that the supplies were not made by them directly through international competitive bidding; also they have not satisfied the condition No.19 appended to the said notification - In our view, the supply of the goods to the project in the present circumstances cannot disentitle them from the benefit of notification. In absence of any contrary evidence to the fact that the pipes in question had not been supplied to the project and used in the project, benefit cannot be denied - appeal allowed - decided in favor of appellant.
Issues:
1. Interpretation of Notification No.6/2006-C.E., dt.1.3.2006 for duty exemption on seamless pipes supply. 2. Eligibility of the appellant for exemption under the notification. 3. Dispute regarding direct supply to the main contractor. 4. Application of conditions stipulated in the notification. 5. Comparison with previous judgments on similar cases. Issue 1: Interpretation of Notification No.6/2006-C.E., dt.1.3.2006 The case involved the interpretation of Notification No.6/2006-C.E., dt.1.3.2006, which provided duty exemption for certain supplies. The appellant despatched seamless pipes to a subcontractor without payment of duty based on a project authority certificate. Issue 2: Eligibility for Exemption The appellant contended that they complied with the conditions of the notification as the supplies were made to the subcontractor of the main contractor involved in a government project. They argued that the goods were used in the project and should be eligible for the exemption. Issue 3: Direct Supply Dispute A key point of contention was whether the appellant's supplies were directly made to the main contractor, as required by the notification. The appellant argued that supplying to the subcontractor should not disqualify them from the exemption. Issue 4: Conditions Stipulated in the Notification The tribunal examined whether the appellant fulfilled the conditions stipulated in the notification, particularly condition No.19. The main contractor had procured the material from the appellant based on the project authority certificate issued by the government. Issue 5: Comparison with Previous Judgments The tribunal referred to previous judgments, including Toshniwal Industries Pvt. Ltd, to support the appellant's eligibility for exemption. They highlighted that the benefit of the exemption should not be denied solely based on the subcontractor not participating in international competitive bidding. In conclusion, the tribunal found that the appellant's supplies met the requirements of the notification and were used in the project, making them eligible for the exemption. The impugned order demanding duty with interest and penalty was set aside, and the appeal was allowed.
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