Custom, Excise & Service Tax Tribunal
Commissioner Of Customs, Central ... vs M/S. Electronics Corporation Of India ... on 4 July, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE SOUTH ZONAL BENCH COURT - I Stay Application No. E/Stay/1623/2012 in Excise Appeal No: E/2220/2012 (Arising out of Order-in-Appeal No:29/2012 (H-III) CE dated 30.4.2012 passed by the Commissioner of Customs, Central Excise and Service Tax (Appeals I & III), Hyderabad.) Commissioner of Customs, Central Excise & Service Tax Hyderabad-III Commissionerate Hyderabad. Appellant Versus M/s. Electronics Corporation of India Ltd. Respondent
Appearance Mr. S. Teli, Dy. Commissioner (AR) for the appellant/Revenue.
None (written submissions) for the respondent/assessee.
CORAM SHRI B.S.V. MURTHY, HONBLE MEMBER (TECHNICAL) SHRI ASHOK JINDAL, HONBLE MEMBER (JUDICIAL) Date of Hearing: 4.7.2013 Date of decision: 4.7.2013 FINAL ORDER No._______________________2013 [Order per: B.S.V. Murthy]. The issue involved in this case is whether the goods manufactured by the appellants in their capacity as a vendors and cleared to another unit for supply to defence are eligible for exemption or not. Appellant availed the exemption and cleared the goods and subsequently after being pointed out by the department that such exemption was not available to them, they paid the entire amount of duty with interest. Subsequently, show-cause notice was issued for appropriating the amount already paid towards duty and interest and for imposition of penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of Central Excise Act, 1944 which culminated in order-in-original confirming the duty demand and imposing penalty. On an appeal filed by the respondent, the Commissioner (A) held that no penalty was imposable.
2. When the matter was called today, there is nobody on behalf of the respondent. However written submissions have been made by them.
3. We find that the issue involved is only penalty under Rule 25 of Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944 and in the light of written submissions and the submissions of the learned AR, the issue can be finally decided. Accordingly, we waive the requirement of pre-deposit and decide the appeal itself.
4. Heard the learned AR and considered the submissions in writing received from the respondent. Learned AR submits that in this case, the appellant availed the exemption which was clearly not available to them. Notification No.63/95-CE dated 16.3.1995 provides exemption for any goods produced and cleared by certain public sector undertakings of the Government of India for the manufacture of goods meant only for the defence forces of the country. In this case, the appellant was not one of the PSUs designated in the Notification. However, they had supplied the goods to the PSU who was named in the Notification who certified that the goods were meant for supply to defence. The learned AR submits that the wordings of the Notification are very clear and there is no room for any doubts and therefore, imposition of penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act, 1944 was appropriate and the impugned order should be set aside and penalty restored.
5. We find that the Commissioner (A) has taken note of the fact that in the case of Sujan Industries vs. CCE, Mumbai: 2007 (220) E.L.T. 161 (Tri.-Mum.), a view had been taken that the goods manufactured by the vendors and cleared to a unit specifying the notification for supply to defence was eligible for the exemption and on this basis he has taken a view that appellant cannot be faulted for taking a view in their favour. On this ground, he has set aside the penalty. Since the period involved is prior to the date when issue was finally clarified and eligibility was decided and it was held that vendors are not eligible, we find that the decision of the Commissioner (A) is appropriate and need not be interfered with. In any case, the appellants are not contesting the liability and have already discharged the same. In the result, stay application as well as appeal filed by the Revenue fails and are rejected.
(Pronounced and dictated in open Court) (ASHOK JINDAL) Member (J) (B.S.V. MURTHY) Member (T) rv 4