1997 (7) TMI 274 - AT - Central Excise

Summary

Issues:
Interpretation of Notification Nos. 234/86 and 31/88 regarding the requirement of end-use certificates for availing benefits.

Analysis:
The case involved the manufacturing of Sobitol Solution by the assessees who claimed benefits under Notification Nos. 234/86 and 31/88. The dispute arose as nine show cause notices were issued due to the absence of end-use certificates for clearances made under the notifications. The Assistant Collector upheld the demand for failing to produce end-use certificates. The Collector (Appeals) found the production of end-use certificates necessary and remanded the case for further consideration, leading to the appeal by the assessees.

The advocate representing the assessees argued that Notification No. 31/88 did not mandate the production of any certificate, including an end-use certificate. He contended that as long as the Drug Controller certified the goods as bulk drugs and fit for specified purposes, the notification's benefit should apply. He cited relevant case laws to support his argument. On the other hand, the SDR supported the Collector's stance on the necessity of end-use certificates.

The Tribunal carefully evaluated the arguments presented. It observed that Notification No. 31/88 exempted bulk drugs complying with the Drugs (Price Control) Order, 1987, without any condition regarding the use of the goods. Therefore, the Tribunal disagreed with the Collector's view that end-use certificates were mandatory for clearances under this notification.

Regarding Notification No. 234/86, the Tribunal noted the conditions for certification by the Drugs Controller, emphasizing that the bulk drugs must be physically used as specified. The Tribunal rejected the argument that the third condition could be interpreted differently from the second, as it would render them redundant. Consequently, the demand upheld for clearances under this notification without end-use certificates.

The Tribunal distinguished the cited judgments, clarifying their relevance to the respective notifications. It affirmed the Collector's stance on the necessity of end-use certificates under Notification No. 234/86 but clarified that such certificates were not required under Notification No. 31/88. The appeal was disposed of accordingly.