M/S. Swastik Pipes Ltd vs Cce, Delhi-Iii

Customs Excise and Service Tax Appellate Tribunal16 January 2015

CitationAppeal No.275/ANS/RTK/2008 dated 8.12.2008 passed by the Commissioner of Central Excise, D

Ratio decidendi

The rule this decision rests on

The exemption under notification no. 6/2002-CE (Sl. No. 196A), which covers pipes used for the delivery of water from its source to the water treatment plant and from there to the storage facility, is not confined to pipes supplying a temporary storage facility located on an intermediate hill; where terrain requires booster pumping and an intermediate storage tank, pipes carrying water beyond that intermediate tank to the water treatment plant and final storage are also eligible for the exemption, and the intermediate hill tank cannot be treated as the "final storage facility" that limits the exemption. The denial of exemption for the pipes beyond the hill storage tank, on the sole ground that the tank was the end of the eligible supply, is unsustainable in law where the exemption's conditions are otherwise satisfied and the required district certificate has been produced.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI

Date of Hearing/decision:16.01.2015

Appeals Nos. E/608/2009-EX(DB)

[Arising out of Order-in-Appeal No.275/ANS/RTK/2008 dated 8.12.2008 passed by the Commissioner of Central Excise, Delhi-III].

M/s. Swastik Pipes Ltd. Appellant

Vs.

CCE, Delhi-III Respondent

For approval and signature:

Honble Shri Rakesh Kumar, Member (Technical)

Honble Shri S.K. Mohanty, Member (Judicial)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Appearance: Rep. by Shri Parth Mullick, Advocate for the appellant.

Rep. by Shri Yashpal Sharma, DR for the respondent.

Coram: Honble Shri Rakesh Kumar, Member (Technical)

Honble Shri S.K. Mohanty, Member (Judicial).

Final Order No.50221/2015 /Dated:16.01.2015

Per Rakesh Kumar:

The appellant are manufacturers of pipes chargeable to central excise duty under Chapter 73 of the Central Excise Tariff. On 16/17.12.2015 they cleared 3968 MT of pipes to Kerala Water Authority at nil rate of duty by availing full duty exemption under notification no.6/2002-CE (Sl.No.196 A) as amended by notification no.47/2002-CE dated 6.9.2002. This exemption notification exempts pipes used for delivery of water from its source to the water treatment plant and from there to the storage facility, from whole of the duty of excise leviable thereon, subject to the condition that a certificate in this regard issued by the concerned District Collector/Dy. Commissioner is produced. There is no dispute that the required certificate in this case had been produced. The departments objection is that the appellant would be eligible for exemption only on that quantity of pipes which was used by Kerala Water Authority for carrying water from the source to the storage tank on the hill and not on the quantity of pipes for carrying water from the hill storage tank to the treatment water storage tank. In this case, between water source and the water storage, there was hilly area as a result of which, the booster pumps had been installed for carrying water upto a certain height and from there, water was carried through the pipe lines to the water treatment plant and water storage. The Department has denied the exemption in respect of the pipes used for the water storage tank on the hill to the water treatment plant and final storage, as according to the Department, the storage tank is located on the hill and the pipes used for carrying water beyond that storage tank are not eligible for exemption. It is on this basis that a duty demand of Rs.2,19,289/- was confirmed against the appellant along with interest and penalty of equal amount by an order passed by the Asstt. Commissioner . On appeal being filed against this order of the Asstt. Commissioner, the same was upheld by the Commissioner (Appeals) vide order-in-original dated 8.12.2008 against which this appeal has been filed.

2. Head both the sides.

3. Both the sides agree that the present issue stands decided by the Tribunal in favour of the appellant in the case of CCE, Kolkata-III Vs. Electrosteel Casting Ltd. reported in 2009 (235) ELT 757 (Tribunal-Kolkata) and the Revenues appeal against this order was dismissed by the Apex Court vide judgement reported in 2009 (244) ELT A-18 (SC). Even otherwise also, since the exemption notification exempts the pipes needed for delivery of water from its sources to the water treatment plant and from there to the storage facility and since in this case, on account of hilly area between the water source and the water treatment plant, the water had to be carried to a temporary storage facility on the hill by booster pumps, the temporary water facility on the hill cannot be treated final storage facility and the benefit of the exemption notification can not be confined only to the pipes need for the supply to the temporary storage facility on the hill. In view of this, the impugned order is not sustainable. The same is set aside. The appeal is allowed.

(Rakesh Kumar)

Member (Technical)

(S.K. Mohanty)

Member (Judicial)

Ckp.

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