2015 (10) TMI 1913 - AT - Central Excise

Denial of exemption claim - whether appellant is required to produce a certificate from the appropriate authority as per condition No. 29(c) of Serial No. 214 under Notification No. 21/2002-Cus., dated 1-3-2002 for availing the Central Excise exemption against Serial No. 91 (Condition No. 19) of Notification No. 6/2006-C.E., dated 1-3-2006 when materials are procured indigenously - Held that - It is observed from the Condition No. 19 of Notification No. 6/2006-C.E., dated 1-3-2006 that there is no mention of Notification No. 21/2002-Cus., dated 1-3-2002 in the language of Condition No. 19. If such a certificate is not issued by DG, Hydrocarbons, as per Notification No. 21/2002-Cus., then it will be discriminatory for a domestic manufacturer to procure duty free goods under International Competitive Bidding. Appellant has also made a statement that no other manufacturer placed similarly and supplying goods to ONGC has been issued any such show cause notice. Learned AR also could not confirm whether other similarly placed manufacturers supplying goods to ONGC under Notification No. 6/2006-C.E., have been issued show cause notice on the same issue or not. In view of the above observations appellant has made out a prima facie case for complete waiver of the confirmed dues and penalties - Stay granted.

Summary

Issues:
- Whether the appellant is eligible for exemption under Sr. No. 91 of Notification No. 6/2006-C.E., dated 1-3-2006.

Analysis:

1. Appellant's Argument:
Shri S.R. Dixit, representing the appellant, argued that the appellant and others were issued a Project Authority Certificate (PAC) by ONGC, and the goods were supplied under International Competitive Bidding (ICB) as per Import & Export Policy provisions. Dixit contended that the PAC from ONGC should suffice as the required certificate, as no other certificate can be issued by the Directorate General of Hydrocarbon. He highlighted that treating the appellant differently would promote imports over domestic goods.

2. Revenue's Defense:
Shri J. Nair, representing the Revenue, supported the lower authorities' decision, emphasizing that the certificate specified in condition No. 29 of Notification No. 21/2002-Cus. must be produced by the appellant to avail the exemption under Notification No. 6/2006-C.E.

3. Court's Observations:
After hearing both sides and examining the case records, the court deliberated on whether the appellant needed to provide a certificate from the appropriate authority as per condition No. 29(c) of Notification No. 21/2002-Cus. to claim Central Excise exemption under Notification No. 6/2006-C.E. The court noted that Condition No. 19 of Notification No. 6/2006-C.E. did not mention Notification No. 21/2002-Cus. The court found it discriminatory if a domestic manufacturer had to procure duty-free goods under International Competitive Bidding without the specified certificate. The court acknowledged the appellant's assertion that similarly placed manufacturers supplying goods to ONGC had not faced similar show cause notices.

4. Decision and Ruling:
Considering the arguments and observations, the court found that the appellant had established a prima facie case for a complete waiver of the confirmed dues and penalties. Consequently, the court granted a stay to the appellant against recoveries until the appeal's final disposal.

This detailed analysis of the judgment in the Appellate Tribunal CESTAT AHMEDABAD case provides insights into the legal arguments, court observations, and the final decision regarding the appellant's eligibility for exemption under the specified notifications.