Project exemption under Notification No. 108/95-CE upheld where substantive conditions were met despite certificate naming the contractor.

Exemption under Notification No. 108/95-CE was held available where goods were cleared against project authority certificates, even though the certificate stood in the contractor's name rather than the manufacturer's. The Tribunal accepted that the goods were actually used in a World Bank and Asian Development Bank financed earthquake rehabilitation project, and treated the substantive purpose of the notification as satisfied. A narrow technical objection to the certificate name was rejected because the exemption conditions were otherwise fulfilled. The demand, penalty, and interest were therefore held unsustainable.

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Issues: Whether exemption under Notification No. 108/95-CE was when the project authority certificate was issued in the name of the contractor and the goods were supplied by the manufacturer for use in a project financed by the World Bank and the Asian Development Bank.

Analysis: The goods were cleared on the strength of the project authority certificates before removal from the factory, and it was not disputed that the TMT bars were actually consumed in the earthquake rehabilitation project. The notification grants exemption to goods supplied to projects financed by an international organisation and approved by the Government of India. A restrictive requirement that the certificate must necessarily stand in the manufacturer's own name was not accepted, since the object of the notification was satisfied and the goods had in fact gone into the project. The Tribunal followed the view that the exemption cannot be denied on a narrow or technical reading when the substantive conditions are fulfilled.

Conclusion: The appellant was entitled to the benefit of Notification No. 108/95-CE, and the demand, penalty, and interest were unsustainable.

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