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2017 (8) TMI 1045 - AT - Central ExciseExemption under N/N. 6/2002-CE dt. 1.3.2002 (Sl.No.196A) and its successor N/N. 6/2006-CE dt. 1.3.2006 - exemption from payment of duty on machinery and their components/parts cleared for setting up water treatment plant and pipes - case of Revenue is that certificate issued by the District Collector cannot be accepted as the basis for compliance of the condition in the notification - Held that - When the certificate has been issued by the District Collector as well as TWAD Board authorities, we have to say that department cannot deny the exemption by merely relied upon a letter issued by Executive Engineer, Special Division, Cuddalore - In the case of Jain Irrigation Systems Ltd. Vs CCE & Customs, Nashik 2017 (3) TMI 990 - CESTAT MUMBAI , the Tribunal in similar set of circumstances had observed that it is not open for the Central Excise authority to overrule the certificate issued by a competent a public authority - appellant are eligible for the exemption - appeal allowed - decided in favor of appellant.
Issues Involved:
Whether the appellants are eligible for exemption under Notification No.6/2002-CE and its successor Notification No.6/2006-CE from payment of duty on machinery and their components/parts cleared for setting up a water treatment plant and pipes. Comprehensive Analysis: Issue 1: Eligibility for Exemption The appellants had cleared PSC pipes without payment of duty under the mentioned notifications for water supply projects. The department contended that some projects did not have a water treatment plant, making the appellants ineligible for exemption. The appellants argued that they complied with the conditions of the notification by obtaining a certificate from the District Collector. They claimed they were under a bona fide belief of eligibility and had paid a substantial part of the duty before the show cause notice. The appellants relied on various judgments to support their case. Issue 2: Compliance with Notification Conditions The Revenue argued that the appellants did not fulfill the conditions of the notification as the pipes were supposed to be used from the source to the water treatment plant and then to storage, which was not the case for some projects. The District Collector's certificate was questioned, stating it did not comply with the notification's conditions. The Revenue emphasized that the certificate issued was based on a misunderstanding of the notification's requirements. Judgment Analysis: The Tribunal agreed with the Revenue that the certificate issued by the District Collector alone cannot be the basis for compliance with the notification's conditions. They cited precedents where certificates issued by public authorities were not sufficient for exemption if the conditions of the notification were not met. The Tribunal referred to the Supreme Court's ruling emphasizing the intended use of goods for exemption. Relying on previous judgments and legal principles, the Tribunal found the demand for duty unsustainable, setting aside the impugned order and allowing the appeals in favor of the appellants. This detailed analysis of the judgment highlights the issues of eligibility for exemption and compliance with notification conditions, providing a comprehensive overview of the arguments presented by both parties and the Tribunal's reasoning leading to the final decision in favor of the appellants.
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