CX - Exemption - Notfn 12/2012 - Since in Annexure to Project Authority certificate, appellant's name figures as sub-contractor, condition that goods should be supplied against ICB procedure is clearly satisfied: CESTAT
By TIOL News Service
MUMBAI, MAR 18, 2014: THE appellant had supplied Electrically Operated Travelling (EOT) cranes to NTPC, BARH Super Thermal Power Project as a sub-contractor of M/s. WPIL Ltd., Kolkata , who was awarded the contract for supply of equipment under International Competitive Bidding (ICB) procedure and claimed the benefit of exemption notification 6/2006-CE, 12/2012-CE.
The lower authorities denied the exemption on the ground that under the Customs Notificationthe benefit is available to the goods falling under Chapter 9801 and moreover the appellant has not participated in the International Competitive Bidding procedure themselves being sub-contractor. Inasmuch as a demand of Rs.9,55,304/- along with interest thereonandpenalty was confirmed by the adjudicating authority and the said order was upheld by the Commissioner(A).
Before the CESTAT, the appellant submitted that the only condition required to be satisfied was that similar goods imported should be exempt from customs duties; that vide Notification No.12/2012-Cus, the goods required for any Mega Power Project of capacity of 1000 MW or more are exempt from import duties subject to a certification given in this regard by an officer of the rank of a Joint Secretary to the Government of India in the Ministry of Power; that there is no dispute that NTPC, BARH Super Thermal Power Project to which the appellant supplied the goods satisfied this condition. Reliance is also placed on the decision in Kent Introl Pvt. Ltd. [2014-TIOL-211-CESTAT-MUM] where the Bench had considered this issue and held that if the goods are supplied, under a contract awarded under International Competitive Bidding procedure, by the sub-contractor, the benefit of excise duty exemption cannot be denied so long as the similar goods imported under exempt from customs duty.
The Revenue representative reiterated the findings of the lower authorities but fairly submitted that the issue is covered by the decision of this Tribunal in the case of Kent Introl Pvt. Ltd. cited by the appellant.
The Bench noted that the issue lies in a narrow compass and, therefore, after dispensing with the requirement of pre-deposit of adjudged dues it took up the appeal itself for consideration and disposal.
The CESTAT observed -
"5.2 Notification No. 6/2006-CE grants exemption to all goods supplied against International Competitive Bidding falling under any chapter subject to the condition that the goods are exempted from customs duty when imported into India. In the case before us, the project authority's certificate issued by the National Thermal Power Corporation clearly indicates that the supply of goods to the BARH Super Thermal Power Project is under the procedure of International Competitive Bidding and the contract has been awarded to M/s. WPIL. In the annexure to the said certificate, the appellant's name figures as a sub-contractor for supply of EOT Cranes. Therefore, the condition that the goods should be supplied against International Competitive Bidding procedure is clearly satisfied. Vide Notification No. 12/2012-Cus, goods falling under CTH 9801 is exempt if the same is supplied for any Mega Power Project of capacity of 1000 MW or more subject to a certification by the Joint Secretary to the Government of India in the Ministry of Power. The said certificate is available on record and it is clearly stated that BARH Super Thermal Power Project has a capacity of 1000 MW or more and satisfies all other requirements for grant of exemption. Therefore, we are satisfied that the appellant has complied with the terms and conditions of the exemption notification. In the Kent Introl Pvt. Ltd. case (cited supra), a more or less the identical issues arose for consideration and this Tribunal held that if the supply is made under International Competitive Bidding procedure by a domestic manufacturer the benefit of exemption under Notification No.6/2006 would be available. The factual position in the present case as also those of Kent Introl Pvt. Ltd. are identical and therefore, we are of the view that the appellant is rightly entitled to the benefit of Notification No.06/2006-CE as amended…."
In fine, the appeal was allowed with consequential relief.
(See 2014-TIOL-408-CESTAT-MUM)
