By TIOL News Service

MUMBAI, DEC 14, 2017: THE appellant cleared goodsviz. KM ELECTROMAGNETIC FLOWMETER HEAD MODEL IFS 4000 SIZE DN 600, LINER PTFE, ELECT SS31316LFLG CONN, SS304 etc. under exemption notification no. 3/2004-CE to M/s. Gannon Dunkerley & Co. Ltd, New Delhi on the basis of a certificate issued by District Magistrate and Collector Sambalpur.

A SCN was issued alleging that the certificate was not issued in favour of appellant and it also did not contains details of goods, therefore, the exemption is inadmissible.

The original authority denied the exemption and confirmed the demand and so did the Commissioner(Appeals). However, the lower appellate authority reduced the penalty.

The appellant is before the CESTAT and submits that even though the name of the appellant is not appearing in the certificate nonetheless the goods were meant for the said project. Reference is made to various documents such as purchase order issued by the project authority M/s. Hindalco Industries Ltd to the buyer of the goods M/s. Gannon Dunkerley& Co. and also the invoices issued by the appellant to M/s. Gannon Dunkerley& Co wherein description of the goods is matching with the purchase order issued. Reliance is placed on the decision in Caterpillar India Pvt. Ltd - 2013-TIOL-562-HC-MAD-CX, 2013-TIOL-562-HC-MAD-CX to justify their claim for the benefit of exemption.

The AR emphasized that unless the certificate is issued in favour of the appellant they cannot supply the goods under exemption Notification No. 3/04 is which the prime condition in the notification.

The Bench extracted the impugned notification and observed –

++ Notification provides that goods which are supplied should be covered under the certificate. In the present case though the name of the appellant is not appearing in the certificate but goods supplied by the appellant is clearly appearing in the purchase order issued by M/s. Hindalco to M/s. Gannon Dunkerley & Co . The said purchase orders reference is appearing in the certificate issued by the collector/district magistrate of Sambalpur district. The same goods were supplied by the appellant to M/s. Gannon Dunkerley & Co in turn M/s. Gannon Dunkerley& Co supplied the same goods to M/s. Hindalco. On perusal of the documents, we are satisfied that link between goods and the appellant and the goods meant for project is established, therefore, in our view appellant is entitled for the exemption notification No. 3/2004.

++ In the present case also there is no dispute that goods supplied was meant for the project covered under Exemption No. 3/04, therefore, significance was given on the goods and the project, therefore, merely because the assessees name is not appearing on the certificate will not debar from the benefit of exemption notification.

Holding that in view of the decisions cited, the appellant is entitled for the benefit of exemption notification no. 3/04-CE, the impugned order was set aside and the appeal was allowed.

(See 2017-TIOL-4400-CESTAT-MUM)