2018 (3) TMI 1055 – RAJASTHAN HIGH COURT – 2018 (361) E.L.T. 37 (Raj.) – Clearance of MS Specials to the water supply projects – benefit of N/N. 47/2002-CE dated 06.09.2002 & N/N. 6/2006-CE dated 01.03.2006 – Whether the ld. CESTAT was right in law in setting aside the demand determined on the basis of non-fulfillment of the conditions of exemption Notification No.47/2002-CE dated 06.09.2002 & Notification No.6/2006-CE dated 01.03.2006 for the clearance of finished goods i.e. MS Specials to the water supply projects without payment of Central Excise Duty? – sub section (3) & (5) respectively of Section 35G of the Central Excise Act, 1944.
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Held that: – the Tribunal has rightly observed that t is not the case of the Department that MS Special were supplied somewhere other than projects in hand. The MS Special are connected with the water pipes before they are used, sometimes as a bend to divert the flow. When the MS Specials were used in the project pertaining to the water supply
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ld. CESTAT was right in law in setting aside the demand determined on the basis of non-fulfillment of the conditions of exemption Notification No.47/2002-CE dated 06.09.2002 & Notification No.6/2006-CE dated 01.03.2006 for the clearance of finished goods i.e. MS Specials to the water supply projects without payment of Central Excise Duty? (ii) Any other question of law as the Hon ble High Court may formulate and decide the same in terms of sub section (3) & (5) respectively of Section 35G of the Central Excise Act, 1944. 3. He has taken us through the contentions raised in the appeal memo which are reproduced as under: S.No. Chapter or heading or subheading or tariff item of the First Schedule Description of excisable goods Rate Condition No. 1 2 3 4 5 7 84 or any other Chapter The Following goods, namely:- (1) All items of machinery, including instruments, apparatus and appliances, auxiliary equipment and their components/parts required for setting up of water treatment plant
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No. 47A of Notification No.47/2002-CE dated 06.09.2002 is extracted hereunder under:- 47A. If, a certificate issued by the Collector/District Magistrate/Deputy Commissioner of the District in which the plant is located, is produced to the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, having jurisdiction, to the effect that such goods are cleared for the intended use specified in column(3) of the Table. 4. He further contended that in view of Chapter 73 article of iron or steel where the assessee has claimed as under:- Tariff Item Description of goods Unit Rate of duty 1 2 3 4 7303 Tubes, Pipes and Hollow Profiles, or Cast Iron. 7303 00 Tubes, Pipes and Hollow profiles, of cast iron: 7303 00 10 Rain water pipe Kg. 12.5% 7303 00 20 Soil pipe Kg. 12.5% 7303 00 30 Spun pipe Kg. 12.5% 7303 00 90 Other Kg. 12.5% 5. Further, according to the Department the entry is as under:- Tariff Item Description of goods Unit Rate of duty 1 2 3
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entral Excise Tariff Act, 1985 (in short 'the Tariff Act'). The proviso makes it clear that where goods are chargeable to nil rate of duty or where the exemption from the whole of the duty of excise leviable is granted on any of the six categories enumerated, the manufacturer is required to make a declaration and give an undertaking, as specified in the Form annexed while claiming exemption for the first time under this Notification and thereafter before the 15th day of April of each financial year. As found by the forums below, including CEGAT, factually, the declaration and the undertaking were not submitted by the appellants. This is not an empty formality. It is the foundation for availing the benefits under the Notification. It cannot be said that they are mere procedural requirements, with no consequences attached for non-observance. The consequences are denial of benefits under the Notification. For availing benefits under an exemption Notification, the conditions have t
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name of product I.e MS Specials. On going through the said notification, it is observed that the said notification provides full exemption to the Pipes covered in any of the chapter needed for delivery of water from its source to the plant and from there to the storage facility subject to the condition No.4 that a certificate issued by the Collector/District Magistrate/Deputy Commissioner of the District in which the plant is located is produced to the Dy./Assistant Commissioner of Central Excise, having jurisdiction over the factory of the effect atha such goods are cleared for the intended use as specified in the Notification. In this case the adjudicating authority has observed that the appellants have cleared MS Specials without payment of duty and no certificate to the effect that such goods were cleared for the intended use as specified in the Notification have been submitted. Under the impugned order the adjudicating authority has observed as under: I, on perusal of the certifi
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see which were recorded on the spot wherein he had interalia stated that PSCC Pipes and MS Pipe are for different use and used in different zones of pressure and site condition and MS Specials are used for changing the alignment using for Tee, Bends and are short in length used for ling and jointing of Pipes in required alignment. However, he submitted the details of clearance of MS Specials during April 2006 to March 2008 ut could not give a proper reply for the said clearances of MS Specials without payment of duty and without having proper exemption certificate in this respect. I also find that the statement of Shri Anil Kedia, Accounts Officer, authorized by the director of the company is also co-related in this respect who tendered the statement that they were simultaneously clearing PSCC Pipes, BWSC Pipes, MS Pipes and MS Specials under various certificates issued by the Collector under exemption Notification No.47/2002-CE dated 06.09.2002 and 06/2006-CE dated 01.03.2006 substant
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ry to the facts mentioned in the impugned order except that MS Pipes and MS Specials are one and same things. Therefore, there is no point to interfere in the impugned order. Moreover, the appellants during the course of personal hearing stated that the certificates in respect of clearances of MS Specials shall be provided within one month but after expiry of more than 3 month, the same has not been submitted. Further, it is observed from the statement of Shri Ramesh Chandra Sahu, Authorized Signatory of the assessee wherein he stated that PSCC Pipes and MS Pipe are for different use and used in different zones of pressure and site condition and MS Specials are used for changing the alignment using for Tee, Bends and are short in length used for lying and jointing of Pipes in required alignment. Further, the Pipes are cleared in running length whereas the MS Specials were cleared in Nos. and Kgs which clearly indicated that both the products are different and their uses are also differ
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t Collector s Certificate would also cover MS Special. On going through the record, we find that out of the 8 certificates in 4 certificates MS Special has been mentioned. The Department has already granted exemption. When the exemption has been granted in 4 certificates it can be granted in the remaining 4 certificates also. It is not the case of the Department that MS Special were supplied somewhere other than projects in hand. The MS Special are connected with the water pipes before they are used, sometimes as a bend to divert the flow. When the MS Specials were used in the project pertaining to the water supply then the same is allowable as Department has already allowed in 4 certificates. Hence, for technical mistake on the part of the appellant, we cannot deny the substantial justice. 10. In our considered opinion, the production is the same, manufacturing and the process is the same and excise duty is liable on the manufacturing, merely because in the certificate there is no men
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