Custom, Excise & Service Tax Tribunal
M/S Cords Cable Industries Pvt. Ltd vs Cce, Jaipur -I on 31 August, 2016
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No.2, R. K. Puram, New Delhi, Court No. 1 Date of hearing: 24.08.2016 Date of decision: 31.08.2016 Excise Appeal No. 2573 of 2010 (Arising out of order-in-original No. 11-13/2010(C.E) dated 12.05.2010 passed by the Commissioner, Central Excise, Jaipur). M/s Cords Cable Industries Pvt. Ltd. Appellant Vs. CCE, Jaipur -I Respondent
Appearance:
Shri P. K. Mittal, Advocate for the appellant Shri Yogesh Agarwal, DR for the Respondent Coram:
Honble Mr. Justice (Dr.) Satish Chandra, President Honble Mr. B. Ravichandran, Member (Technical) Final Order No. 53297 / 2016 Per: B. Ravichandran:
The appeal is against order dated 12.05.2010 of Commissioner of Central Excise, Jaipur. The appellants are engaged in the manufacture of electric wires and cables liable to Central Excise duty. They were supplying the said dutiable items under international competitive bidding to various thermal power plants without payment of duty availing exemption under Notification No. 6/2006 dated 01.03.2006 read with Notification No. 21/2002-Cus. dated 01.03.2002. The exemption availed by the appellant was sought to be denied by the Revenue on the ground that the classification against Sl. No. 400 in Notification No. 21/2002-Cus. is indicated as 9801 whereas the wires and cables manufactured and cleared by the appellants are classifiable under CETH 8544. Proceedings were initiated against the appellant which concluded vide the impugned order where the ld. Commissioner confirmed the Central Excise demand of Rs.3,60,45,825/=. No penalty was imposed on the appellant.
2. Ld. Counsel for the appellant submitted that the exemption in terms of Notification No. 6/2006-CE is for goods falling under any chapter of the First Schedule to the Central Excise Tariff Act, 1985 provided the said goods are supplied against international competitive bidding. The notification has condition No. 19 which is to be satisfied by the appellant. The said condition stipulates that the goods should be exempted from the duties of customs leviable under the First Schedule to the Customs Tariff Act, 1975 and the additional duty leviable under Section 3 of the said Act when imported into India. Exemption to custom duty has been provided vide Sl. No. 400 of Notification No. 21/2002-Cus. However, in the said notification, the classification of the product is given under CTH 9801. The Revenues objection is that since the product manufactured and cleared by the appellant is classifiable under CETH 8544, the exemption under customs notification is not applicable, consequently, the exemption under Central Excise Notification No. 6/2006 also will not be applicable. Ld. Counsel contended that there is no dispute that the appellants infact made supplies only to mega power project supported by proper certificates issued by competent authority. All the Conditions of Sl. No. 400 of customs notification has been fulfilled. The classification given under custom notification is not for a particular item by description but refers to project imports. In other words, the import item is identified by its usage rather than by its nature. Ld. Counsel relied on the decision of this Tribunal in Paramount Communication Ltd. vs. CCE, Jaipur-I vide Final Order No. 52166-52167/ 2016-Ex (DB) dated 23.06.2016 wherein it has been held that the assessee are eligible for exemption under the said Central Excise notification.
3. Ld. AR submitted that the appellants are not eligible for exemption in terms of Sl. No. 400 of Custom Notification No. 21/2002. There are other entries in the said notification where classification is mentioned as any chapter. Since the impugned goods do not fall under Chapter 9801 of the Customs Tariff the exemption cannot be extended to the said goods. He further submitted that the exemption notification should be construed strictly for extending benefit.
4. We have heard both the sides and examined the appeal records.
5. We find that in the same set of facts came up for decision before this Tribunal in earlier cases. In Sarita Steels and Industries Ltd. vs. CCE vide Final Orders Nos. 1076-1081/2010 dated 15.07.2010 the Tribunal held that when the fact that supplies are made to mega power projects and all the conditions have been fulfilled the goods which are required for execution of mega power project are categorically exempted by the said customs notification. So in Om Metals SPML JV Unit 2 vs. CCE &ST, Jaipur 2013 (298) ELT 79 (Tri. Del.) the Tribunal held that there is no heading 9801 in Central Excise Tariff which is only in Customs Tariff. The goods manufactured in India cannot be classified under 9801, accordingly, denial of exemption on that ground is not tenable. Further, the Tribunal in Paramount Communications Limited vide Final Order dated 23.06.2016 examined the very same issue and held the denial of exemption on the ground of classification shown under Customs Notification is 9801 is not sustainable. The same ratio has been followed by the Tribunal in KEI Industries Limited vide Final Order No. 52371 / 2016 dated 01.07.2016.
6. In view of the above decided cases, it is clear that the denial of the exemption to the appellant is not legally sustainable. Admittedly, the condition stipulated for exemption under Notification No. 6/2006-CE has been fulfilled by the appellant except for the classification in column-2 of Entry No. 400 in Customs Notification No. 21/2002-Cus. As clearly noted, the classification 9801 is not available in Central Excise Tariff and the same relates to project import, as such the denial of exemption on this grounds is legally not sustainable. Accordingly, we set-aside the impugned order and allow the appeal.
(Pronounced on 31.08.2016).
(Justice (Dr.) Satish Chandra) President (B. Ravichandran) Member (Technical) Pant