2017 (11) TMI 27 - AT - Central Excise

Benefit of N/N. 108/95-CE dated 28.08.1995 - Revenue is that the goods manufactured by the appellant have not supplied to the project but to the contractors - Held that - the Tribunal in the case of JCB India Limited 2017 (1) TMI 1227 - CESTAT CHANDIGARH has observed that the goods which have been cleared to the contractors who are executing the work for projects Financed by the Asian Development Bank, the appellant is entitled for the benefit of exemption N/N. 108/95-CE dated 28.8.1995. Therefore, no demand is sustainable against the appellant - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against denial of exemption under Notification No.108/95-CE dated 28.08.1995 for goods supplied to contractors instead of projects financed by Asian Development Bank.

Analysis:
The appellant appealed against the denial of benefit under Notification No.108/95-CE for goods supplied to contractors instead of projects financed by the Asian Development Bank. The Revenue contended that since the goods were not directly supplied to the project but to the contractors, the exemption did not apply. The show cause notice invoked the extended period of limitation to demand duty, interest, and penalty. The appellant argued that the issue was covered by a previous Tribunal decision in the case of JCB India Ltd. The Tribunal analyzed the Notification No. 108/95 and found that the appellant was entitled to the exemption as the goods were supplied to projects financed by the Asian Development Bank and approved by the Government of India. The Tribunal emphasized that the condition for exemption was the supply of goods to the project, not the direct payment by the organization financing the project. The Tribunal cited previous cases to support its decision, highlighting that the goods being used for the project sufficed for exemption, even if retained by subcontractors after project completion. The Tribunal dismissed the Revenue's appeal, stating that all conditions for the beneficial Notification were met, and no additional conditions should be imposed. The Tribunal relied on the JCB India Limited case, affirming that goods cleared to contractors for projects financed by the Asian Development Bank were eligible for the exemption.

In conclusion, the Tribunal allowed the appellant's appeal with consequential relief, emphasizing that the goods supplied to contractors for projects financed by the Asian Development Bank were entitled to the benefit of exemption under Notification No.108/95-CE. The judgment clarified that the focus was on the supply of goods to the project, meeting all necessary conditions for the exemption, and rejected the Revenue's appeal.