1999 (9) TMI 290 - AT - Central Excise

Summary

Issues:
- Entitlement to benefit of Notification No. 263/87-C.E. dated 10-12-1987 for telecommunication equipments under Chapter 85 of Central Excise Tariff Act, 1985.
- Interpretation of the terms of the notification regarding use for systems/sub-systems of Integrated Guided Missile Development Programme.
- Acceptance of certificate by the concerned authority for claiming the benefit of the notification.

Analysis:
1. The appeal questioned the denial of the benefit of Notification No. 263/87-C.E. to the appellants for telecommunication equipments like EPAX and PBT under Chapter 85 of the Central Excise Tariff Act, 1985. The Collector of Central Excise (Appeals) held that the appellants were not entitled to the benefit as the notification specified that the benefit was for equipment intended for the Integrated Guided Missile Development Programme.

2. The Commissioner observed that although a certificate was presented, it indicated that the EPAX system would be used for both internal and external communication in the plant, not specifically for the Integrated Guided Missile system. The purchase order also revealed that the EPAX system was intended for general communication use within the plant, not for the missile system. Consequently, the Commissioner upheld the denial of the benefit under the notification for the mentioned items.

3. During the hearing, the appellant's advocate contended that the certificate issued by the concerned authority should have been accepted, and the benefit extended for the imported equipments. However, the Revenue's representative argued that the certificate did not clearly specify the EPAX system's use for the Integrated Guided Missile system, as required by the notification's terms.

4. The Tribunal carefully reviewed the arguments and examined a letter from the Programme Management Board of Defence Research & Development Laboratory, which stated that the EPAX system was essential for communication during the explosive filling of missile warheads. However, the letter did not explicitly state that the EPAX system was intended for the systems/sub-systems of the Integrated Guided Missile. The Tribunal emphasized that the notification's terms were restrictive and specific to equipment intended for the missile system, which the EPAX system did not fulfill.

5. Additionally, an Excise Duty Exemption certificate indicated that the EPAX system had 100 lines, not all of which were used in the Integrated Guided Missile system but for general telephonic exchange within the plant. Therefore, the Tribunal upheld the Commissioner's decision to deny the benefit of the notification, as the EPAX system did not meet the criteria of being intended for the missile system. Consequently, the appeal was rejected based on the lack of merit in the appellant's arguments.