Tribunal upholds duty demand under Notification No.64/95-CE for supplied goods, penalties revoked.

The Tribunal confirmed the duty demand for goods supplied under Notification No.64/95-CE, except for those cleared under CT-2 and AR3A certificates, which were subject to further verification. Penalties were revoked, except for the confirmed duty demand, which the appellants were directed to pay immediately. The appeals were disposed of, highlighting the significance of adhering to permissions and legal provisions in similar transactions.

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Issues:
Dispute over exemption under Notification No.64/95-CE for goods supplied to Indian Navy through Indian Oil Corporation Ltd (IOCL(W)). Interpretation of permission sought and granted for clearance of goods. Reliance on previous Tribunal decisions and distinguishability of facts. Disagreement on applicability of Tribunal decisions and Supreme Court rulings. Demand of duty on goods supplied under CT-2 and AR3A certificates. Imposition of penalties and remand for verification of certain goods.

Analysis:
The appeals involved a dispute regarding the exemption under Sr. No. 3 of Notification No.64/95-CE for goods supplied by M/s. Bharat Petroleum Corporation Ltd (BPCL) to Indian Navy through Indian Oil Corporation Ltd, Wadala (IOCL(W)). The issue arose when the permission sought and granted for clearance of goods by BPCL was examined. The appellant argued that the facts of their case were different from a previous Tribunal decision involving Indian Oil Corporation Ltd and thus sought to distinguish their case based on the permissions obtained from the department for supplying goods to Indian Navy.

The appellant highlighted the permissions granted by the Assistant Commissioner of Central Excise for clearance of goods to their depots and further sale at nil rate of duty to eligible customers. They emphasized the sequence of correspondence with the revenue authorities to support their case. However, the Tribunal observed that the permissions granted were solely for clearances made to BPCL's own depots and not specifically for supplies to IOCL(W) for further clearance to the Indian Navy. Consequently, the appellant failed to distinguish their case from the previous Tribunal decision involving Indian Oil Corporation Ltd.

Regarding reliance on previous decisions, the appellant cited cases such as GE India Industrial Ltd and Wartsila (I) Pvt Ltd to support their argument. However, the Tribunal noted that these cases dealt with different provisions of the notification and were not directly applicable to the present situation. Instead, the Tribunal found that the decision in the case of Leader Engineering Works, approved by the Supreme Court, was more relevant to the facts of the current case concerning the supply of stores onboard Indian Navy vessels.

Furthermore, the appellant raised concerns about the duty demand on goods supplied under CT-2 and AR3A certificates, arguing that there was no intention to evade duty, especially considering IOCL's status as a public sector undertaking. The Tribunal acknowledged this point and directed the original adjudicating authority to verify and issue fresh orders regarding the demand against goods cleared under these certificates. Penalties imposed were set aside, except for the confirmed duty demand, which the appellants were directed to pay immediately.

In conclusion, the Tribunal confirmed the demand of duty, except for goods cleared under CT-2 and AR3A certificates, which required further verification. Penalties were revoked, and the appeals were disposed of accordingly, emphasizing the importance of compliance with permissions and relevant legal provisions in such transactions.

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