2017 (12) TMI 278 - AT - Central Excise

N/N. 3/2004-CE dated 8-1-2004 - it was alleged that the certificate was not issued in favor of appellant nor it contains details of goods therefore the adjudicating authority has denied exemption notification - Held that - As per the notification, it can be seen that only those goods in respect of which certificate is issued by collector/Dy. Commissioner/District Magistrate of the District in which project is located is produced to the Dy. Commissioner or Asstt. Commissioner of Central Excise as the case may be having jurisdiction. Notification provides that goods which he supplied should be covered under the certificate. In the present case though the name of the appellant is not appearing in the certificate but goods supplied by the appellant is clearly appearing in the purchase order issued by M/s. Hindalco to M/s. Gannon Dunkerley & Co. The said purchase orders reference is appearing in the certificate issued by the collector/district magistrate of Sambalpur district. The same goods were supplied by the appellant to M/s. Gannon Dunkerley & Co in turn M/s. Gannon Dunkerley & Co supplied the samegoods to M/s. Hindalco - On the perusal of the documents, we are satisfied that link between goods and the appellant and the goods meant for project is established, therefore appellant is entitle for the exemption N/N. 3/2004. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Interpretation of exemption notification no. 3/2004-CE for goods supplied to a project under a certificate not in the appellant's name; Imposition of penalty under Rule 25 of Central Excise Act, 2002 for alleged suppression of facts.

Interpretation of Exemption Notification:
The case involved the appellant clearing goods under exemption notification no. 3/2004-CE to a company based on a certificate issued by a district magistrate and collector. The dispute arose as the certificate did not mention the appellant's name, leading to the denial of the exemption. The appellant argued that the goods were intended for a specific project, supported by purchase orders and invoices. The tribunal analyzed the notification's conditions and noted that while the appellant's name was absent from the certificate, the goods supplied were clearly linked to the project. Citing precedents, the tribunal held that the appellant was entitled to the exemption as the goods were meant for the project covered under the notification, emphasizing the significance of the goods and project over the appellant's name on the certificate.

Imposition of Penalty under Rule 25:
The appellant contested the penalty imposed under Rule 25 of the Central Excise Act, 2002, arguing that there was no malafide intention to evade duty. They highlighted that all necessary documents were submitted to the authorities during clearance, indicating compliance. The tribunal considered relevant judgments and concluded that unless there was proof of suppression of facts with intent to evade duty, the penalty was not warranted. Relying on precedents, the tribunal held that in the absence of any allegation of misuse and with proper intimation to the excise officer, the penalty was unjustified. The tribunal set aside the penalty, emphasizing the lack of malafide intention on the appellant's part.

Conclusion:
The tribunal, after considering submissions from both sides and examining the records, ruled in favor of the appellant. They found that the appellant met the conditions of the exemption notification despite the absence of their name on the certificate. The tribunal emphasized the connection between the goods supplied and the project's intended use, granting the appellant the benefit of the exemption. Additionally, the tribunal overturned the penalty imposed under Rule 25, citing lack of evidence of malafide intention. The appeal was allowed, and the impugned order was set aside in favor of the appellant.