Direct sales to actual users qualified for concessional cement duty; retail-sale objections and Revenue challenge failed.

Cement clearances made directly by the manufacturer to institutional consumers and actual users were treated as eligible for the concessional duty rate under Notification No. 4/2007-CE, because the benefit was linked to direct sales to service industry or industrial customers. The Revenue's objection failed where it did not show that the Tribunal decision relied on by the original authority had been overruled, and the challenge to reliance on the Board circular was rejected. As direct sales to actual users did not amount to retail sale under Rule 2(q) of the Packaged Commodity Rules, 1977, the basis for denying the concession was not established, and the dropped demand was upheld.

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Issues: Whether clearances of cement made directly to institutional consumers and actual users qualified for the concessional rate of duty under Notification No. 4/2007-CE dated 01.03.2007, and whether the Revenue could succeed in challenging the dropped demand.

Analysis: The concessional benefit under the notification was linked to clearances directly by the manufacturer for service industry or industrial customers. The Revenue did not show that the Tribunal decision relied upon by the original authority had been overruled, and the objection to reliance on the Board circular was found untenable. The sales in question were direct sales to various actual users, and under Rule 2(q) of the Packaged Commodity Rules, 1977 a retail sale requires sale through an intermediary to an ultimate consumer. Direct sales to actual users did not fall within retail sale, so the basis for denying the benefit was not made out.

Conclusion: The Revenue's challenge failed, and the order dropping the remaining demand was upheld.

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