Water-pipe exemption extends to temporary hill storage points; a logistical stop is not the final storage facility.

Pipes used to convey water to a temporary hill-top storage point, before onward supply to the water treatment plant and final storage facility, were considered within the scope of the water-pipe exemption notification. The prescribed certificate had been produced, and the dispute turned on whether the temporary storage point could be treated as the final storage facility. The Tribunal held that a logistical stop created because of hilly terrain did not become the final storage facility contemplated by the notification, so the exemption could not be narrowed to exclude the disputed segment. The demand, interest, and penalty were therefore not sustainable.

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Issues: Whether pipes used for conveying water to a temporary hill storage point, before onward supply to the water treatment plant and final storage facility, were eligible for exemption under the notification granting duty relief for pipes used for delivery of water from the source to the water treatment plant and from there to the storage facility.

Analysis: The notification exempted pipes used for delivery of water from the source to the water treatment plant and from there to the storage facility, subject to production of the prescribed certificate, which was admittedly produced. The dispute was whether a hill-top storage point created because of the terrain could be treated as the final storage facility. The Tribunal held that where booster pumps were used due to hilly terrain and the water was only carried to a temporary storage point on the hill, that point could not be regarded as the final storage facility contemplated by the notification. The exemption could not be confined only to the pipes leading up to that temporary storage point.

Conclusion: The pipes used in the disputed segment remained eligible for the exemption, and the demand, interest, and penalty could not be sustained.

Ratio Decidendi: A temporary storage point created en route for logistical reasons does not become the final storage facility for the purpose of a water-pipe exemption notification, and the benefit cannot be restricted by an unduly narrow reading of the notification.

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