2005 (11) TMI 146 - AT - Central Excise

Summary

Issues Involved:
The issues involved in this case are the applicability of Notification No. 108/95 for exemption of duty on goods supplied to a project financed by UNICEF and the denial of benefit under Notification No. 49/94-C.E. (N.T.) due to non-compliance with technical procedures.

Applicability of Notification No. 108/95:
The appellants cleared Polyols to M/s. Inalsa Limited for the manufacture of vaccine carriers supplied to a UNICEF project, claiming exemption under Notification No. 108/95. The department disputed the exemption, leading to payment of duty under protest and a subsequent refund claim. The Tribunal held that the benefit cannot be denied based on goods not being directly supplied to the UNICEF project, citing precedent. As the goods ultimately benefited the UNICEF project, the denial of the benefit was deemed unjustifiable. Consequently, the appellants were found entitled to the refund.

Denial of Benefit under Notification No. 49/94-C.E. (N.T.):
The appellants also sought exemption under Notification No. 49/94 for goods supplied to M/s. Inalsa, which were used for deemed export to UNICEF under an advance intermediate license. The Assistant Commissioner denied this benefit due to non-compliance with technical procedures, despite completion of all supplies for export. The appellants argued that as they had availed the benefit of Notification No. 108/95, which did not require such procedures, the denial was unwarranted. They further contended that any duty demand should have been limited to six months from clearance, as no grounds for an extended period existed. The Tribunal agreed with the appellants, finding no justification for invoking the longer period for duty demand, as there was no intent to evade duty. The appeal was allowed, granting relief to the appellants.

This judgment by the Appellate Tribunal CESTAT, Chennai highlights the interpretation and application of excise duty exemption notifications in the context of goods supplied for UNICEF projects, emphasizing compliance with technical procedures and the absence of grounds for invoking an extended period for duty demand.