2002 (3) TMI 138 - AT - Central Excise

Summary

Issues:
1. Eligibility for exemption under Notification No. 108/95 for ACSR Aluminium Conductors supplied to Asian Development Bank financed project in Karnataka for Power Efficiency Project.

Analysis:
The main issue in this appeal was whether the ACSR Aluminium Conductors supplied by the appellants to a project financed by the Asian Development Bank were eligible for exemption under Notification No. 108/95. The notification required a certificate from the International Organisation stating that the goods were to be supplied to a project financed by them and duly approved by the Government of India. The exemption was denied as the appellant failed to produce a certificate directly from the Asian Development Bank. However, the appellants argued that certificates issued by the Project Authorities should suffice, as it is the standard procedure for projects financed by International Organisations. They also cited a Tribunal decision and a Supreme Court judgment to support their contention that benefits should not be denied based solely on the source of the certificate.

The learned DR argued that the requirement was for a certificate from the United Nations or an International Organisation, and since the certificates produced were not from the same agency, the appellant should not be eligible for the exemption. However, it was undisputed that the supply of ACSR Conductors was for a project financed by the Asian Development Bank, making it eligible for the exemption. The dispute centered around whether the certificate had to be issued directly by the ADB. The appellants explained that it is standard practice for certificates to be issued by Project Authorities in such cases, and the certificates issued by the Project Authorities were already on record. Rejecting an eligibility certificate issued by an authorized person and approved by the Government of India would defeat the purpose of the notification aimed at reducing project costs financed by International Institutions. Upholding the exemption denial based solely on technicalities would go against established legal principles and the intent of the notification.

In conclusion, the Tribunal found in favor of the appellants, allowing the appeal and setting aside the order denying the exemption. The decision emphasized the importance of considering the practical application and purpose of such notifications rather than strictly adhering to technicalities that would defeat the intended benefits.