Custom, Excise & Service Tax Tribunal
Himgiri Metals Pvt. Ltd vs C.C.E., Meerut I on 18 July, 2014
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No.2, R.K.Puram, New Delhi COURT-III Date of hearing/decision: 18.7.2014 For Approval and Signature: Honble Ms. Archana Wadhwa, Judicial Member Honble Mr. Rakesh Kumar, Technical Member 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Central Excise Appeal No. 126 of2011 Arising out of the order-in-appeal No.223-CE/MRT-1/2010-11 dated 30.9.2010 passed by the Commissioner (Appeals), Central Excise, Meerut I. Himgiri Metals Pvt. Ltd. .. Appellant Vs. C.C.E., Meerut I .. Respondent
Central Excise Appeal No.166 of 2011 Arising out of the order-in-appeal No.223-CE/MRT-1/2010-11 dated 30.9.2010 passed by the Commissioner (Appeals), Central Excise, Meerut I. C.C.E,. Meerut I .. Appellant/Revenue Vs. Himgiri Metals Pvt. Ltd. .. Respondent Central Excise Appeal Nos.655 656 of 2012 Arising out of the order-in-appeal No. 80-CE/MRT-1/2010-11 and No.81-CE/MRT-1/2010-11 both dated 30.11.2011 passed by the Commissioner (Appeals), Central Excise, Meerut I. Himgiri Metals Pvt. Ltd. .. Appellant Vs. C.C.E., Meerut I .. Respondent Appearance:
Present Shri Praveen Kumar, Advocate for the assessees Present Shri M.S. Negi, Advocate for the Appellant/Revenue Coram: Honble Ms. Archana Wadhwa, Judicial Member Honble Mr. Rakesh Kumar, Technical Member Final Order No.52884 52887/2014 Per Archana Wadhwa:
All the four appeals - three by assesses and one by Revenue for imposition of penalty in respect of common impugned order, are being disposed of together, inasmuch as the issue involved is the same.
2. The appellant/assessees are engaged in the manufacture of zinc sulphate (agricultural grade). For the said purpose they were procuring sulphuric acid without payment of duty in terms of Notification No.4/2006-CE dated 1.3.2006. Serial No.32 of the said Notification exempts sulphuric acid, along with some other items mentioned and used in the manufacture of fertilizers. The Explanation appears thereunder is to the effect that - For the purpose of this exemption, fertilizers shall have the meaning assigned to it under the Fertilizer (Control) Order, 1985.
3. Inasmuch as the zinc sulphate is classified under Chapter Heading 28 of the CETA, 1985, Revenue entertained a view that the same cannot be considered as fertilizers which are classifiable under Chapter Heading 31.Accordinlgy, they initiated proceedings against the assessee for denial of the benefit of Notification and consequent confirmation of demand. The said proceedings resulted in passing of the present impugned orders confirming demand and imposing penalties. As in one case, the Commissioner (Appeal) set aside the penalty, Revenue has filed the present appeal also.
4. The issue involved in all the appeals is as to whether the assessee is entitled to benefit of the Notification No.4/2006-CE in respect of procurement of sulphuric acid without payment of duty, which is being used in the manufacture of zinc sulphate fertilizer grade. Revenues objection is that inasmuch as zinc sulphate is being classified under Chapter 28, the same cannot be held as fertilizers, which are classifiable under Chapter 31.
5. We find that the said dispute was the subject matter of the earlier decision of the Tribunal, though in the context of the different Notification No.81/75.In the case of Punjab Micronutrient Ltd. vs. C.C.E. 1990 (48) ELT 603 (Tri.) as also in the case of C.C.E. vs. India Phosphate and Carbonate 1998 (98) ELT 634 (Tri.), it stand held that classification of fertilizer under a particular tariff heading is not a pre-requisite condition for extending the benefit of exemption Notification. Inasmuch as the zinc is essential for growth and development, the same has to be considered as fertilizer. Both the decisions also took note of the fact that zinc sulphate is included in the Fertilizer (Control) Order, 1985. One such decision in the case of Punjab Micronutrient Ltd. also stands upheld by the Honble Supreme Court reported as 1996 (68) ELT A-72 (SC).
6. It is seen that at the time of the decision of the Tribunal in above referred case, there was no Explanation attached to the Notificatin No.81/75 which was under consideration. However, the Explanation was subsequently included in the said Notification, which is identical to the Explanation as available in the present Notification No.4/2006. It is further seen that neither in the earlier Notification No.81/75 nor in the present Notification No.4/2006, there is any requirement of the fertilizer to be classified under Chapter 31 also. The only requirement in the present Notification which was also introduced in the previous Notification by way of including Explanation is to explain the meaning of fertilizer. It stands mentioned in the Explanation that fertilizer shall have the meaning assigned to it under Fertilizer (Control) Order, 1985. Both the decisions referred to by the ld. Advocate have taken note of the fact that zinc sulphate is included in the Fertilizer (Control) Order, 1985. As such the said condition of Notification also stands fulfilled by the assessee.
7. In view of the above, we, by following the precedent decisions of the Tribunal as upheld by the Honble Supreme Court, find no merits in the Revenues stand. Accordingly, the appeals filed by the assessee are allowed and appeal filed by Revenue is rejected. All the four appeals are disposed of in above manner.
(Archana Wadhwa) Judicial Member (Rakesh Kumar) Technical Member scd/ 4