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TMI Blog2009 (11) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... ]. - This appeal is filed against the Order-in-original No. 03/2009-(CX)(PNR) dated 23-1-2009. 2. The relevant facts that arise for consideration are :- The appellant herein had, during the period February, 2002 to February, 2007, availed benefit of exemption Notification No. 6/2002-C.E., dated 1-3-2002, Notification No. 3/2004-C.E., dated 8-1-2004 and Notification No. 6/2006-C.E., dated 1-3-2006 (hereinafter called as the Notifications) respectively. The appellants herein are manufacturers of Ductile Iron Pipes (DIP) and are clearing major quantity of this goods on payment of appropriate duty of excise in the normal course. However, while clearing the said DIPs for the purpose of water supply project and for Water Treatment Plant (WTP), the appellants availed the benefit of the above said Notifications and cleared the said DIPs without payment of duty by producing the certificates issued by a Collector/District Magistrate/Deputy Commissioner of the District wherein the plant is located before the clearance of the said goods. The Revenue authorities entertained a view that the clearances made by the appellant by availing the benefit of the said Notifications as irregular, called ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or pipes used for delivery of water from source to water treatment plant and from there to the storage facility/facilities irrespective of whether the water treatment plant is newly set up or otherwise and whether the storage facility is first storage facility or beyond. In this regard Board vide letter F. No. 354/34/2008-TRU, dated 14-3-2008 while clarifying that the pipes used for replacement of worn out/damaged pipe are allowed under the notification has clarified, "2. Doubts have been raised about whether the exemption pertaining to pipes applies only to pipes required for the setting up of water treatment plants or a/so to pipes for replacement of worn-out/damaged pipes. 3. The matter has been examined. In view of the policy objective of creating the requisite infrastructure for augmenting the availability of clean, potable drinking water, it is clarified that the aforesaid exemption would also apply to pipes required, for replacement and not just those for initial setting up". From the above clarification it is very clear that the pipes eligible for the benefit of Notification are those which are required in the initial setting up of water treatment plants i.e., the pipes use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Excise, Kolkata-III v. Electrosteel Castings, 2009 (235) E.L.T. 757 (T.) = 2009 (90) RLT 476 (T.-Kol.) (ii) Commissioner of Central Excise, Customs & Service Tax (Appeals-III) v. IVRCL Infrastructures & Projects & Ors. - Final Orders No. 1431 and 1432/2008 passed in Appeal Nos. E/273 and E/274 of 2004 on December 24, 2008 (T.-Bangalore). [2009 (240) E.L.T. 606 (Tribunal)]. The appeals preferred by the Revenue against both the aforesaid decisions have been rejected by the Supreme Court by orders dated August 24, 2009 and October 23, 2009 respectively. It is submitted that in view of the aforestated decisions of the Supreme Court the orders passed by the Tribunal in Commissioner of Central Excise v. Electrosteel Castings Ltd. (supra) and Commissioner of Central Excise, Customs & Service Tax (Appeals) v. IVRCL Infrastructures & Projects (supra) stands merged with the decisions of the Supreme Court. This is so even if the dismissal of both the appeals filed by the Revenue were in limine by non-speaking order, in view of the fact that the Supreme Court was exercising its appellate jurisdiction in terms of Section 351 of the Central Excise Act. In this regard reliance is placed upo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Sl. No. (2) of the first Notification and Sl. No. (ii) of the second Notification have to be related to the water supply plants to be set up under Item No. (1)/(ii) of the said Notifications. On the contrary the presence of a semicolon after the end of Item No. (1)/(1) makes it clear that the two clauses are disjunctive. The words 'the plant' in Item No. (2)/(ii) simply means and has to mean any Water Treatment Plant. In this respect reliance is placed upon the following decisions : (i) State of Orissa v. Jogindar Patjoshi, 2004 (9) SCC 278 (S.C.), para 16, at page 285 (ii) M.K. Salpekar v. Sunil Kumar Shamsunder, 1988 (4) SCC 21, para-7 at page 25 (iii) Falcon Tyres Ltd. v. State of Karnataka, 2006 (6) SCC 530, para 11 at page 534 (iv) Samna Alana Abdulla v. State of Gujarat, 1996 (1) SCC 427, paras 7 &8, at page 430 Further, it is significant that the words used are 'the plant' and not 'the said plant'. In the absence of any such provision in either of the said Notifications no such requirement can he implied or read into the said Notifications. Thus the pipes used for intended purposes specified in the said Notifications are eligible for exemption. Whether they are used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illegal, invalid and had for this reason also. It is now settled by decisions of the Apex Court that if under an exemption notification a certificate is required to be issued, as a condition there under, of a prescribed/competent authority for availing the benefit under the said Notification, once such a certificate is issued by the prescribed/competent authority the Revenue cannot go behind such certificate and deny benefit of exemption under the said Notification. In the instant case, from Annexures I to VII of the said order, it would be seen that in each and every case certificate as required by the said Notifications about the intended use of the said goods in the concerned projects were given by the specified competent/prescribed authority. Copies of the said certificates are at pages 513 to 746 of the Paper Book — Vol. III. Once such certificates were submitted by the appellant, the Commissioner should have held and erred in not doing so, that the requirements under the said Notifications had been duly satisfied and the appellant was duly entitled to exemption under the said Notifications and had, therefore, correctly availed of the same in respect of the said goods manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to introduce in the said Notifications such a condition, which on a plain reading thereof is absent therefrom. No such power has been conferred upon him under the Act or the said Notifications. Once the certificates were issued by the competent/prescribed authority under the said Notifications, there was or remained no obligation on the part of the appellant to submit clarifications containing details as to whether pipes are used in water supply scheme or whether any new water treatment plant was being set up or constructed or as to the quantity of pipes used in different sections of the project etc. or to submit any schematic diagram of the water supply project/scheme and the benefit under the said exemption notifications could not be denied on these purported ground. The finding to the contrary by Commissioner in the said order is ultra vires the said Notifications and thus ex-facie untenable and unsustainable. The Commissioner by purporting to introduce such requirements has sought to introduce further conditions in the said Notifications which he has no right, authority or jurisdiction in law to do. Reliance upon the decision of the Larger Bench of the Tribunal in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion and can have no applicability whatsoever. It is settled law that by issuing a circular subsequent to an exemption notification new condition cannot be added thereto restricting the scope of exemption or whittling it down. (i) Union of India v. Intercontinental (India), 2008 (226) E.L.T. 16 (S.C.) (ii) Tata Teleservices Ltd. v. Commissioner of Central Excise, 2006 (194) E.L.T. 11 (S.C.), para 10 (iii) Sandur Micro Circuits Ltd. v. Commissioner of Central Excise, 2008 (229) E.L.T. 641 (S.C.) The Commissioner has purported to rely upon the decision of the Constitution Bench of the Supreme Court in Commissioner of Central Excise v. Ratan Melting & Wires Industries, 2008 (231) E.L.T. 22 (S.C.) = 2008 (12) S.T.R. 416 (S.C.) to come to a conclusion that since the Hon'ble Court had not declared that the Circular dated October 20, 2005 was contrary to the statutory provisions, the same could be relied upon ignoring binding decisions of this Hon'ble Tribunal on the issue. The Commissioner failed to appreciate that no such licence has been given by the Supreme Court by or in the aforesaid decision to any adjudicating authority. On the contrary, in the light of the principles laid d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e premises, on this ground also, the demand of Rs. 23,38,81,717/- (out of the total demand of Rs. 41,30,31,281/-) is untenable and unsustainable as being barred by limitation. Contrary to the misconceived allegations in the show cause notice and finding in the said order, the condition precedent for invoking the extended period limitation contained in the Proviso to Section 11A(1) of the Act has not and cannot be said to have been satisfied in the instant case. In this respect reliance is placed upon the following decisions : (i) Firepro Systems Pvt. Ltd. v. Commr. of Service Tax, 2008 (10) S.T.R. 606 (T.) (ii) Polyspin Ltd. v. Commr. of Customs 2007 (214) E.L.T. 347 (T.) (iii) Denson Pultretaknik v. CCE, 2003 (155) E.L.T. 211 (S.C.) (iv) Hyundai Unitech Electrical Transmission Ltd. v. CCE, 2005 (187) E.L.T. 312 (T.) Moreover, in the instant case decisions of both the jurisdictional Bench and the Eastern Bench of the Tribunal, as aforestated, have upheld the similar contentions of the respective assesses on interpretation of the same notifications. In such circumstances there can be no allegation or finding of misstatement or suppression of fact by the appellant with intent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el would also submit that the circular of the Board dated 4-3-2008 very clearly clarifies the issue as to the pipes which are required for replacement are also eligible for the benefit of the Notifications if they are used in WTP/Water supply plants. It is his submission that the certificate issued by the respective Collector/District Magistrate /Deputy Commissioner of the District in which such WTP is located is not disputed by the Revenue, as they are genuine and authenticate. It is his submission that the ld. Commissioner has gone beyond the certificates which were issued by the competent authorities. He would submit that the clarification sought by the Revenue was obtained by the appellant and submitted to the authorities, for which the adjudicating authority has said that these clarifications are not certified by the competent authority. It is his submission that this kind of further clarification to be certified by the competent authority, is not envisaged in the said Notification. 4.1 Shri P.R.V. Ramanan, Special Counsel appearing on behalf of the Revenue would submit that the contentions raised by the ld. Counsel are incorrect. It is his submission that the reasoning adopt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is his submission that if Department's interpretation of supplying wording is objectionable then the interpretation of the appellant of adding the plural "storage facilities" is equally objectionable. 4.6 He would also draw our attention to the meaning of the word "The" given in the various dictionaries and would submit that the use of the word is for specifying or particularizing effect opposed to the indefinite or generalizing force of 'a' or 'an'. He would submit that his reading will be correct and harmonious to the interpretation of the Notification and hence the benefit of Notifications is not available to the appellant in this case. 5. In his rejoinder, ld. Counsel for the appellant would draw our attention to the clarification certificate issued by the various authorities to indicate that such clarification was given in furtherance to the queries raised by the Revenue. It was also submitted that there is no requirement in the Notification for giving any further evidence as regards the exact use of the pipes cleared from the factory premises of the appellant. 6. We have considered the submissions made at length by both sides and perused the records. 7. We have already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication, that the only condition which is required to be fulfilled by an assessee in order to avail the benefit of exemption is to produce the certificate issued by Collector/District Magistrate/Deputy Commissioner of the District in which the plant is located to the effect that such goods are cleared for intended use specified under Column No. 3 of the said table. In short, a certificate given by the competent authority that the goods which are cleared are intended to be used in water supply project, is sufficient for availing the benefit of exemption Notifications. 12. In the case before us, it is undisputed that the appellant had produced the requisite certificates issued by competent authorities before the lower authorities before clearing the product DIPs for WTP/Water supply project. Mere perusal of the few of the certificates issued by the competent authorities clearly indicates that the said certificates were given in pursuance to the condition as stipulated in the said Notifications. It is also undisputed that the appellant had produced clarification from the authorities subsequent to the queries raised by the Revenue authorities and said clarifications very clearly indic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether the exemption pertaining to pipes applies only to pipes required for the setting up of water treatment plants or also to pipes for treatment of worn-out/damage pipes. 3. The matter has been examined. In view of the policy objective of creating the requisite infrastructure for augmenting the availability of clean, portable drinking water, it is clarified that the aforesaid exemption would also apply to pipes required for replacement and not just those for initial setting up. 4. Field formations may be suitably informed. (Vivek Johri) Joint Secretary (TRU) (Emphasis supplied) 14. It can be seen from the above reproduced circular and more specifically in para 3, that the Govt. of India had clarified that the exemption would also apply to pipes required for replacement and not just those for initial setting up. This would indicate that the pipes which are supplied for replacement of worn out or damaged pipes are also eligible for the benefit of exemption under the Notifications. This clarification of the Govt. of India is sought to be brushed aside by the adjudicating authority on the ground that it will be of prospective nature. We do not agree to these findings and sim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification merely talks about the storage facilities and there is no restriction that the water should be delivered only to the first storage point, as has been provided in the amended Notification with effect from 1-3-07. It is obvious that the unamended Notification would have to be interpreted to cover the impugned pipes which were needed to deliver water not only to the first storage point but also to the second and subsequent storage point, such as elevated storage reservoirs where the water was further treated for chlorination. If it was the intention of the Government to restrict the exemption for pipes up to first storage point, the Notification should have been accordingly worded from the beginning. In the absence of such a restriction, the Respondents have executed the Work Order in respect of Water Treatment plants which are of public utilities and the concerned District Collectors have also given them the necessary certificates in respect of the exemption Notification as it was in its unamended form. Even after amendment, we find that the pipes of higher dimension have been allowed exemption in addition to the pipes required upto the first storage point. In other wor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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