9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (10) TMI 1083 - AT - Central ExciseClearances of Armoured Panels and Stretcher Assembly to HAL, Bangalore - Duty exemption benefit of Notification No. 63/1995-CE dated 16.03.1995 denied - allegation of the Department is that the Notification grants exemption only to the goods manufactured by these units and not for suppliers of the inputs / products by other vendors or contractors or job workers - suppression of facts or not - extended period of limitation. HELD THAT - This exemption certificate clearly indicates (i) name and address of the supplier (ii) description of the goods to be manufactured and supplied (iii) the items that are required for the production of Advanced Light Helicopter (ALH) against the order of Ministry of Defence, Government of India, and, (iv) these goods are exempted from payment of excise duty leviable under Notification No. 63/1995-CE dated 16.03.1995. A scrutiny of the relevant Notification indicates in respect of other entries, it is specifically mentioned who has to manufacture and where to be utilized. The entries at column Nos. 4 to 7 indicate that certain specified goods are to be manufactured by M/s. HAL or other mentioned units including where they are to be used. In respect of entry No. 16 for items Pistol, Rifle and SLR falling under Chapter 93, the conditions specified include that the goods are to be manufactured by Bharat Dynamics Limited, Hyderabad and before clearance of the said goods, a certificate granting of exemption from the Deputy Secretary of Ministry of Home Affairs is required to be submitted. Whereas in the instant case there is no mention in the impugned Notification regarding who is competent to issue the above duty exemption certificate - it is opined that the Notification is deficient to this extent. It is not known how the practice of issuance of these exemption certificates by the officials of HAL came into practice. In the case of THE COMMISSIONER OF CENTRAL EXCISE BENGALURU-V VERSUS M/S. DATASOL INNOVATIVE LABS 2017 (2) TMI 1171 - KARNATAKA HIGH COURT had held a similar issue in favor of assessee. Though the Department filed appeal against such order before the Hon ble High Court of Karnataka, the Hon ble High Court upheld the order of the Tribunal without rendering any finding on the question of law framed on merits of the case. Moreover, the Hon ble Apex Court in the case of GOVERNMENT OF KERALA ANR. VERSUS MOTHER SUPERIOR ADORATION CONVENT 2021 (3) TMI 93 - SUPREME COURT has observed that an exemption Notification has to be read as a whole so as to give affect for the purpose for which it is issued. Time limitation - HELD THAT - The Show Cause Notice dated 05.07.2013 was issued demanding duty for the period from 2008-2012 invoking extended period under proviso to Section 11A(1) / 11A(4) of the Central Excise Act, 1944. The appellant has cleared the impugned goods on the basis of the exemption certificates given by the officials of M/s. HAL and all the details were furnished in the invoices and in the ER-1 returns. These exemption certificates have certified that these goods are meant for ALH Project and would be used by HAL for ALH Project and would be supplied to the Ministry of Defence for their use. As such, no suppression with an intent to evade duty is attributable to the appellant. So, the demand of duty invoking extended period is not legal and so not sustainable. The appellant succeeds on merits as well as on limitation - Appeal allowed.
Issues Involved:
1. Eligibility for duty exemption under Notification No. 63/1995-CE. 2. Interpretation of the exemption notification. 3. Applicability of the Board's Circular. 4. Invocation of extended period for demand. Summary: 1. Eligibility for Duty Exemption under Notification No. 63/1995-CE: The main issue was whether the appellant was eligible for the duty exemption benefit under Notification No. 63/1995-CE for their clearances of Armoured Panels and Stretcher Assembly to HAL. The notification allows exemption to all goods if manufactured by specified units like Hindustan Aeronautics Limited (HAL) for supply to the Ministry of Defence for official purposes. 2. Interpretation of the Exemption Notification: The Department argued that the exemption is only for goods manufactured by the specified units and not for suppliers to these units. The adjudicating authority confirmed the demand, relying on the decision in National Engineering Industries Ltd. vs. Commissioner of Central Excise, Jaipur, which stated that extending the benefit to job workers and vendors would amount to extending the scope of the exemption notification. However, the appellant argued that the Rajasthan High Court reversed this decision, allowing the exemption based on the Board's Circular dated 23.06.2006. 3. Applicability of the Board's Circular: The Board's Circular clarified that if goods are manufactured by ancillary units or sub-contractors on a job work basis, the notification benefit would be available. The appellant argued that their case is covered under this circular and referred to several judicial precedents supporting this view, including decisions from the Karnataka High Court and the Supreme Court emphasizing purposive construction of exemption notifications. 4. Invocation of Extended Period for Demand: The appellant contended that there was no deliberate mis-declaration or suppression of facts, as all clearances were duly reflected in their ER-1 returns and were based on exemption certificates issued by HAL. The Tribunal found that the demand invoking the extended period was not sustainable as there was no intent to evade duty. Conclusion: The Tribunal concluded that the interpretation which advances the object of the notification should be adopted, allowing the exemption for goods supplied to HAL for the ALH Project for the Ministry of Defence. The demand invoking the extended period was also found to be unsustainable. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief.
|
