M/S.Alstom T&D India Ltd. And vs Ltu, Chennai

(Arising out of Order-in-Appeal Nos.52 & 53/2010 dated 28.5.2010 and Order-in-Appeal No. 7, 8 & 9/2011 dated 23.2.2011 passed by the Commissioner of Central Excise (Appeals), LTU, Chennai)

M/s.Alstom T&D India Ltd. and Schneider Electric Infrastructure Ltd. Appellant

Vs.

LTU, Chennai Respondent

Appearance

Shri M. Selvakumar, Advocate for the Appellant Shri B. Balamurugan, AC (AR), for the Respondent

CORAM

HONBLE SHRI R. PERIASAMI, TECHNICAL MEMBER

Date of Hearing / Decision: 25.3.2015

Final Order No. 40335-40339 / 2015

In respect of Appeal Nos. E/547 & 548/2012, the appellants have filed miscellaneous application for change of cause title from Areva T&D India Ltd. to Alstom T&D India Ltd. In addition, due to demerger with M/s. Schneider Electric Infrastructure Ltd., the appellant has prayed that the cause title should reflect both the names and amended as Alstom T&D India and Schneider Electric Infrastructure Ltd. Accordingly, both the miscellaneous applications are allowed and Registry is directed to amend the cause title as Alstom T&D India Ltd. & Schneider Electric Infrastructure Ltd.

2. After disposing the miscellaneous applications, the main appeals are taken up for hearing and disposal as the issue involved in all the five appeals are identical. The common issue involved in these appeals is whether the appellants are eligible for exemption Notification No. 6/2006 dated 1.3.2006. The appellants supplied circuit breakers, control panels and relays along with mandatory spares under International Competitive Bidding by availing Notification No.6/2006 dated 1.3.2006. The adjudicating authority confirmed the demand being the amount equivalent to the credit availed on the said mandatory spares cleared as such and also demanded interest and imposed penalty under Rule 15. By the impugned orders, the Commissioner (Appeals) has upheld the adjudication orders.

3. The learned counsel for the appellant reiterated the grounds of appeals and submits that the issue relates to the period March 2005 to June 2009. He further submits that the issue stands settled by the decision of the Tribunal vide Final Order No. 181 & 182/2012 dated 2.3.2012 in their own case. He further submits that no appeal has been filed against the said final order and prayed for allowing the appeal.

4. Learned AR for Revenue reiterated the findings of the Commissioner (Appeals).

5. After hearing both sides and on perusal of the records, I find that the main issue to be decided is whether the appellants are eligible for exemption Notification No. 6/2006 dated 1.3.2006 and the issue stands settled by the decision of this Tribunal in the appellants own case vide Final Order No. 181 & 182/2012 dated 2.3.2012 and the Revenue has accepted the said order. Para 4 of the said order is reproduced below:-

4. After hearing arguments from both sides, I find that under the CENVAT Credit Rules, when any goods are supplied duty-free, the assessee is required to ordinarily reverse the credit or pay 10% of the value of the exempted goods. However, there are exceptions provided under Rule 6(6) of CENVAT Credit Rules. One such exception under Rule 6(6)(vii) applies to goods supplied against international competitive bidding. In the present case, not only the circuit breakers have been supplied against international competitive bidding but also the mandatory spares. The exemption has been availed in respect of both and the department is not questioning the same. Rightly so, because the purchase orders as well as the bid by the appellants include not only the main item of circuit breaker but also mandatory spares. Hence, it is seen that the mandatory spares themselves on their own right have been supplied against international competitive bidding and the same have availed exemption under the aforecited Notification No. 6/2006. In such a case, there is no justification to ask the appellants to either reverse the credit or pay 10% of the value of such spares. Further, it was the Governments policy to treat supply against an international competitive bidding on par with exports and grant exemption. In the case of exports, the goods are not only supplied duty-free but also the exporter is allowed to either get a refund of the duty on the inputs or a drawback. Equity demands that the appellants who have supplied the impugned goods against international competitive bidding are not burdened with the duty on the inputs which have been supplied along with the main equipment as mandatory spares, without which they could not have fulfilled their obligation under the international competitive bidding. In view of the foregoing, the impugned orders are set aside and both the appeals are allowed.

5. Respectfully following the decision of the Tribunal in the appellants own case, I set aside the order passed by learned Commissioner (Appeals) and allow the appeals filed by the appellants. Accordingly, the miscellaneous applications and the appeals are allowed.

(Dictated and pronounced in open court)

(R. PERIASAMI) Technical Member Rex

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