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TMI Blog2012 (3) TMI 352X X X X Extracts X X X X X X X X Extracts X X X X ..... - E/2478/2005 - Final Order No. A/244/2012-EX(BR)(PB) - Dated:- 2-3-2012 - Ms. Archana Wadhwa and Shri Mathew John, JJ. Shri P.K. Sahu and Prashant Shukla, Advocates, for the Appellant. Shri S.R. Meena, AR, for the Respondent. ORDER The Appellants manufactured transmission towers for electricity and supplied it to Sasaram HVDC transmission system, a project executed by M/s. Power Grid Corporation of India Ltd. ( PGCIL for short). PGCIL certified that the project was covered under PSDP-II loan of World Bank. The Appellants cleared the goods from 23rd September, 1999 to March, 2001 and claimed exemption under Notification No. 108/95-C.E., dated 28-8-1995. The said exemption was available for projects financed by World Bank. However, the project was financed by World Bank only with effect from 1-3-2000. Therefore an issue arose whether the said exemption could be extended to goods cleared prior to that date. Since there was doubt on this issue the Appellants remitted an amount of Rs. 1,21,19,858/- and claimed that they were eligible for Cenvat credit on customs duty paid on inputs used to the extent of Rs. 1,13,28,587/-. Revenue issued a Show Cause Notice demanding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid by PGCIL amounting to Rs. 1,13,28,587/- on raw materials imported by PGCIL and used by the Appellants in the manufacture of excisable goods. 7. The ld. A.R. for Revenue submits that the project qualified for exemption under Notification No. 108/95-C.E., dated 28-8-1995 only from 1-3-2000 because only from that date the World Bank financed the project and therefore all the clearances made prior to that date has to pay duty. Ld. AR points out that this position was accepted by PGCIL when they paid Customs duty on the imported raw material. PGCIL also pointed out to the Appellants about the liability prior to 1-3-2000 and the Appellants paid excise duty as soon as the issue was raised with them. It is the contention of the A.R. that the Bills of Entry under which the inputs were imported by PGCIL showed payment of nil rate of Customs duty and therefore straight set off of duty paid by PGCIL on the raw materials cannot be allowed and that has to be done in a separate proceedings as is ordered in the impugned order-in-original. 8. We have considered arguments on both the sides. 9. We are not able to see any mis-representation on the part of the Appellants with intent to evade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reement with the argument of the Appellants that the claim for Cenvat credit should be decided in a separate proceeding for the reason that the Bills of Entry concerned did not show payment of Customs duty. It stands explained by the Appellants that initially the goods were imported without payment of duty availing the exemption for goods imported for supply to a project financed by World Bank and when the issue that they might not be eligible for such exemption for the period prior to 1-3-2000 was pointed out to them they paid the duty subsequently. In the facts of the case duty paid on raw materials should have been taken into account while the duty liability. 11. We are of the view that the impugned project is in fact a project financed by the World Bank. We do not see anything in the wordings of the notification for denying the exemption to goods supplied to the project prior to the date from which finance was provided by the World Bank. As already decided in the case of Nestor Pharmaceuticals Ltd. exemption under Notification No. 108/95-C.E. cannot be denied for the reason that part of the project was met by the beneficiary of the loan from the World Bank. The fact that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed upon the Noticee under Section 11AC of the Central Excise Act, 1944 read with Rule 25 of the Central Excise Rules, 2002. (iii) The Noticee should also pay the interest on the duty confirmed in terms of Section 11AB of the Central Excise Act, 1944. (iv) As regards admissibility of Modvat credit on the inputs imported and CVD paid subsequently, the Noticee is directed to approach to the Jurisdictional Divisional Commissioner, who will examine the admissibility of Modvat credit as per law. 16. It is seen from the above, the total duty confirmed against the appellant was to the tune of Rs. 2,34,48,545/-. The order recorded by learned Member (Technical) is to the effect that the benefit of Notification No. 108/95-C.E., was available to the appellant and as such no duty demand could be confirmed against them by denying the benefit of said notification. Consequence of the order so recorded by the learned Member (Technical) would be that the demand confirmed against the appellant to the extent of Rs. 2,34,48,545/- is not sustainable against them. 17. It is further seen that the appellant have already deposited an amount of Rs. 1,21,19,858/-. The deposit of said duty was du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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