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TMI Blog2023 (7) TMI 667X X X X Extracts X X X X X X X X Extracts X X X X ..... not so. The Rotor Blades has been fixed in the Windmill, which is a vital component for completion of the Windmill project. After considering the facts of the case and perusing the records, the judgment of the Hon ble Jurisdictional High court in the case of Nordex India Pvt. Ltd. is squarely applicable to the instant case. Following the same, the demand proposed in the SCN is on misconception of facts and law - the appeal filed by the department is dismissed. - CUSTOMS APPEAL No. 40842 OF 2017 - FINAL ORDER No. 40558/2023 - Dated:- 17-7-2023 - HON BLE MS. SULEKHA BEEVI C. S. , MEMBER ( JUDICIAL ) And HON BLE MR. VASA SESHAGIRI RAO , MEMBER ( TECHNICAL ) Mr. Anandalakshmi Ganeshram , Supdt. ( A. R ) For the Appellant Mr. Udit Jain , Advocate Ms. Akanksha Dikshit , Advocate For the Respondent ORDER ORDER : Per Ms. SULEKHA BEEVI, C.S. The above appeal is filed by the Department against the order passed by the Commissioner who dropped the proceedings initiated vide show cause notice No.06/2016 dated Nil/2/2016 alleging that the respondent herein wrongly availed exemption of Basic Customs Duty (BCD) under Notification No.21/2002-Cus. dated 01.03.2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw, the original authority observed that there is no violation of conditions and dropped the proceedings. Aggrieved by such order, the department is now before the Tribunal. 4. Ld. A.R Ms. Anandalakshmi Ganeshram reiterated the grounds of appeal. It is submitted by the Ld. A.R that the intention of the Government as per the notification is that not only the product should be used for the specified purpose but the importer himself should use the product. Though many amendments came at later dates, for the past 20 years, the Government has not changed the condition to relieve the importer from fulfilling this condition that importer has to use the product himself. The respondent has wrongly sold the parts to the customer which is complete violation of the condition of the notification. Thus, the duty demand raised in the SCN ought to have been confirmed by the adjudicating authority. Ld. A.R prayed that the appeal may be allowed. 5. Ld. Advocate Mr. Udit Jain appeared along with Ms. Akanksha Dikshit, Advocate and argued for the respondent. It is submitted that the allegation in the SCN is mainly founded on the basis of the agreement entered with the customer. That it is alleged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed. 8. Heard both sides. 9. The issue involved in this appeal is the denial of benefit of BCD exemption Notification No.21/2002-Cus. dt. 1.3.2002 (Sl.No.224-condition No.35) and Notification No.12/2012-Cus. dt. 17.3.2012 (Sl.No.362 Condition No.45) to the goods imported by the respondent. The allegation of the department is that the respondent has violated condition No.45 (ii) of the notification. The details and the serial number of the above two notifications are noticed below :- S. No. Chapter or Heading or sub-heading or tariff item Description of Goods Std. Rate Addl. Duty rate Condition No. (1) (2) (3) (4) (5) (6) 224 362 84 or any Chapter The following goods, namely:- Wind operated electricity generators upto 30 KW and wind operated battery chargers upto 30 KW. 5% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply with sub-conditions (i) or (ii), or both conditions as the case may be, he shall pay an amount equal to the difference between the duty leviable on the imported gods but for the exemption under this notification and that already paid at the time of importation. 10. The case of the department is that the respondent has not fulfilled conditions oof the notifications as the imported blades were sold and were not put to use by the respondent for the specified purpose. 11. The issue has been analysed and discussed by the adjudicating authority which reads as under : 18. GE India has also produced necessary documents like supply contract and erection commissioning contract, they had with their client clearly evidencing that they have entered into two separate agreements with their clients i.e. one to sell the parts and another for erection, commissioning and installation of the wind mill.. Therefore, I find that the imported parts were properly utilized by GE India for the specified purpose i.e. for manufacture of Wind Operated Electricity Generators (WOEG) as per the Condition No.35 (ii) and 45 (ii) specified against . (2) to (5) of the Sl.No.224 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner availed concession/exemption by giving an undertaking that the Rotor Blades imported would be used for manufacture of the Windmill. This being so, the Special Intelligence and Investigation Branch of the Customs Department at Tuticorin, conducted investigation into import of Rotor Blades made by the petitioner during May, 2018. The petitioner produced the required documents such as, copies of bills of entry, import invoice, bill of lading, purchase order, letter of credit, contract copies and end-user certificate. Further, the petitioner explained that they are the manufacturer of Windmill and as such, they install, erect and commission the Windmills for the customers at the respective site under an agreement and that they are eligible for availing the exemption available. 11. Further, as per the contract terms, the full value of the invoices were paid only on successful commissioning of Windmills, not on invoice basis. Though the Rotor Blades shown as sold, the possession retained by the petitioner, the same ultimately used in the manufacture of Windmill by the importer (at the customer s site) as required under the exemption notification. Hence, its utilizati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditional duty of customs under Sl. No. 14-C of the Customs Notification No. 21/2012-Cus., dated 17-3-2012, as amended (read with condition No. 46 of the Customs Notification No. 12/2012-Cus., dated 17-3-2012). The petitioner have obtained certificates from the Ministry of New and Renewable Energy on the ground that the Rotor Blades will be used for the manufacture of WOEGs. Further, they have also executed undertaking bonds to the Assistant Commissioner with an undertaking that the said goods, namely, Rotor Blades of Wind Operated Generator falling under CTI 8503 00 90 are imported for the manufacture of wind operated power generators. It is seen that nowhere in the notification, it is stated that the goods should not be sold before it is utilized by the importer in assembly and erection of the Wind Operated Energy Generator, which is done at the site of their customer, to whom it is sold. Further, the sale of Rotor Blades does not bar the importer to avail credit benefits, who sells it to his customer. The importer still have the contractual responsibility of manufacturing (assembly, erection and installation) of the Windmill at the customer s site, as they are the manufactures of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d thereafter, transporting the same to the customer s site is only an notional exercise, by that alone, it cannot be said that the petitioner is not the importer and he is the person, who has used the same for a specific purpose, for which, it was imported. The payment to the petitioner is not on invoice to invoice basis, it is a turnkey project, wherein, the payments made at stages, which is no way correlated to the invoices raised. This Court as well as the Hon ble Apex Court held that the wording of the notification is to be interpreted in such a way as not to frustrate the purpose of the notification. The exemption cannot be denied unless it is seen that it has been made to evade duty, it leads to evasion of duty. In this case, it is not so. The Rotor Blades has been fixed in the Windmill, which is a vital component for completion of the Windmill project. The specific purpose is the key word to be looked into, which is completed in the above case. 13. After considering the facts of the case and perusing the records, we are of the view that the judgment of the Hon ble Jurisdictional High court in the case of Nordex India Pvt. Ltd. (supra) is squarely applicable to the insta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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