2000 (11) TMI 794 - AT - Central Excise

Summary

Issues:
1. Whether the exemption under Notification No. 123/81-C.E. is applicable to specific items procured by a company.

Analysis:

Issue 1:
The primary issue in this case was the applicability of the exemption contained in Notification No. 123/81-C.E. to M.S. Grating and Bottom Work Platform procured by a company, which is a 100% Export Oriented Undertaking. The Revenue contended that these items were not used in the manufacture of finished goods and thus should not qualify for the exemption. However, the Respondent argued that both items were essential for their manufacturing operations in Agro based projects and were brought in connection with the manufacture of goods, making them eligible for the exemption.

Analysis of the Judgment:
The Tribunal analyzed the language of Notification No. 123/81, which exempts capital goods, components, raw materials, consumable spares, and packing material when brought in connection with the manufacture and packing of articles by a 100% E.O.U. The Tribunal referred to a previous decision by a Larger Bench in the case of Kudremukh Iron Ore Co. Ltd., where it was held that the exemption should not be confined to materials directly used in the manufacture of the final product but should also include items required to manufacture the final product. The Tribunal concluded that based on this interpretation, the M.S. Grating and Bottom Work Platform were indeed used in connection with the manufacture of goods by the Respondents. Therefore, the appeal filed by the Revenue was rejected, and the benefit of the exemption was upheld for the company.

This detailed analysis of the judgment showcases the interpretation of the legal provisions, application of precedents, and the final decision reached by the Tribunal regarding the exemption eligibility of the specific items in question.