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2009 (5) TMI 443 - AT - Central ExciseExemption to EOU- Notification No. 126/94-C.E., dated 2-9-1994- The relevant facts that arise for consideration are that the appellants have procured storage safe of Model-81-Depender from M/s. Godrej & Boyce Mfg. Company Ltd., against a CT 3 certificate No. 14/98, dated 23-6-1998 without payment of Central Excise duty. In their application dated 19-6-1998 for issuance of CT 3 certificate, the appellants mentioned that the safe was capital goods for them. These safes were considered not eligible for duty free clearances under Notification No. 126/94-C.E., dated 2-9-1994, in view of the fact that the safe was not covered by the description of the goods mentioned in the Annexure-I of the said notification and as such the safe did not appear to be capital goods. Held that- after considering the said Notification we hold that appellant is eligible to avail benefit of notification No. 126/94 for procuring Godrej safe. Accordingly, we find that the impugned order is not sustainable and is liable to be set aside and we do so. The impugned order is set aside and the appeal is allowed with consequential relief if any
Issues:
1. Eligibility for availing the benefit of Notification No. 126/94 for procuring a safe without payment of Central Excise duty in an EOU. Analysis: The appeal was directed against an order-in-appeal where the appellants procured a storage safe without paying Central Excise duty. The appellants claimed the safe was capital goods for them, but it was considered ineligible for duty-free clearances under Notification No. 126/94. A show cause notice was issued proposing a demand for unpaid Central Excise duty. The Adjudicating authority concluded the appellant was ineligible for Cenvat Credit, which was confirmed by the Commissioner (Appeals). The appellant argued that the safe was used for storing raw and finished diamonds, making them eligible for the benefit under Notification No. 126/94. However, the Revenue contended that the safe did not qualify under the notification as an item used in production or manufacture. The Tribunal considered whether the appellant was entitled to the benefit of the notification for procuring the safe without paying Central Excise duty in their EOU. It was established that the appellant was a 100% EOU manufacturing diamonds and had procured the safe against a CT3 certificate without paying Central Excise duty. The Tribunal found the Revenue's contention misplaced, accepting the appellant's justification that the safe was used for storing diamonds. The Tribunal referred to Annexure-1 of Notification No. 126/94, which included items like capital goods, material handling equipment, and office equipment among others. The Tribunal concluded that the safe could be categorized as 'office equipment' under the notification, allowing its procurement without duty payment. Therefore, the Tribunal held that the appellant was eligible for the benefit of Notification No. 126/94 for procuring the safe. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief. In summary, the Tribunal ruled in favor of the appellant, holding that they were entitled to avail the benefit of Notification No. 126/94 for procuring the safe without paying Central Excise duty in their EOU. The decision emphasized the classification of the safe as 'office equipment' under the notification, leading to the setting aside of the previous order and allowing the appeal.
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