2022 (9) TMI 1398 - AT - Central Excise

Appellate Tribunal Upholds Revenue Decision on SSI Exemption for Pumps without ISI Certification

Coronation Industries Versus C.C.E. & S.T. -Bhavnagar

The Appellate Tribunal CESTAT AHMEDABAD upheld the Revenue's position that the appellant was not entitled to SSI exemption under Notification No. ... SSI exemption - case of Revenue is that appellant’s product pumps are not in conformation to standard specified by Bureau of Indian Standards (BIS), since the appellant do not possess ISI Certification - benefit under N/N. 08/2003- CE dated 01.03.2003 denied - HELD THAT:- There is a clear admission of Shri Manubhai Nanjibhai Dhola, Partner of the Appellant who confirmed that the product manufactured by them i.e. Water Turbine Pumps do not conform to the standard Specified under BIS i.e. they have not obtained ISI Certification for their product. According to Sr. No. (xl) of Annexure to Notification No. 08/2003- CE dated 01.03.2003 the benefit of said notification is not available to such pumps. Accordingly the appellant is not entitled for exemption Notification No. 08/2003- CE dated 01.03.2003 hence demand was correctly confirmed. Accordingly, the demand along with interest is upheld. Equal penalty imposed by the lower authority under section 11AC of the Central Excise Act, 1944 - HELD THAT:- The appellant has not been extended the option of reduced penalty of 25%. Accordingly, the penalty under Section 11 AC stands reduced to 25% subject to payment of duty and interest and 25% penalty within one month from the date of this order. Appeal allowed in part. Issues:Entitlement for SSI exemption under Notification No. 08/2003-CE for finished goods pumps without ISI Certification.Analysis:The judgment by the Appellate Tribunal CESTAT AHMEDABAD, delivered by Hon'ble Member (Judicial) Mr. Ramesh Nair and Hon'ble Member (Technical) Mr. Raju, dealt with the issue of whether the appellant is entitled to SSI exemption under Notification No. 08/2003-CE for their finished goods pumps without possessing ISI Certification. The Department contended that the pumps did not conform to the standards specified by the Bureau of Indian Standards (BIS) due to the absence of ISI Certification, making the appellant ineligible for the exemption as per Sr. No. (xl) of the Annexure to the said Notification.Upon the appellant's non-appearance despite sufficient opportunities, the appeal was taken up for disposal. The Revenue, represented by Shri R.P. Parekh, Superintendent (AR), emphasized that the appellant failed to produce ISI Certification for the pumps cleared under the exemption Notification, justifying the demand for Excise Duty, Interest, and Penalty. The Tribunal noted the admission by the appellant's partner, confirming that the Water Turbine Pumps manufactured by them did not meet the BIS standards and lacked ISI Certification, rendering them ineligible for the benefits of the Notification.After careful consideration, the Tribunal concurred with the Revenue's stance, upholding the demand for duty and interest. However, regarding the penalty imposed under Section 11AC of the Central Excise Act, 1944, the Tribunal observed that the appellant had not been offered the reduced penalty option of 25%. Consequently, the penalty was reduced to 25%, subject to payment of duty, interest, and the revised penalty within one month from the date of the order. The impugned order was modified accordingly, and the appeal was dismissed, affirming the decision on entitlement to the exemption under Notification No. 08/2003-CE for the pumps without ISI Certification.The judgment, pronounced on 08.09.2022, clarified the appellant's ineligibility for the exemption due to the absence of ISI Certification for their pumps, thereby confirming the demand for duty and interest while reducing the penalty to 25% with specific payment conditions within the stipulated timeframe.