2018 (8) TMI 158 - AT - Central Excise

Tribunal grants exemption for tractors in launch project under Notification No. 64/95

The Tribunal overturned the denial of exemption on tractors used in a launch vehicle project under Notification No. 64/95. Despite the department's ... Exemption on tractors cleared on concessional rate of duty - N/N. 64/95 dated 16.3.1995 - Department was of the view that the said goods are not eligible for exemption - Held that:- The tractors are used as part and parcel of their launch vehicle project for transporting rocket fuel etc. The launch paid from where national prestigious launches are taking place. That these are in the form of technical equipment for their launch vehicles - the certificate has been given certifying the description and quantity of each type of goods cleared availing the exemption. So also the intended use of the goods for the said project is also certified. Even though the goods cleared may be tractors, the same have been put to use by SHAR for the purpose of launching projects. The said item therefore becomes covered under the notification - denial of exemption not justified - appeal allowed - decided in favor of appellant. Issues: Denial of exemption on tractors cleared under Notification No. 64/95 dated 16.3.1995 for being used in a launch vehicle project.Analysis:1. The appellants, who are manufacturers of agricultural tractors, supplied tractors to a space center availing exemption under Notification No. 64/95 dated 16.3.1995. The department denied the exemption, leading to a show cause notice and subsequent confirmation of demand by the original authority and the Commissioner (Appeals), prompting this appeal.2. The appellant argued that the tractors were part of a satellite project used in a launch vehicle project, complying with the conditions of the notification. They provided a certificate from the space center confirming the tractors' role in transporting rocket fuel and propellants for launch vehicles, asserting that the denial of exemption was erroneous. Reference was made to a relevant case law to support the argument.3. The department contended that the certificate issued by the space center did not have the authority to certify goods for exemption. They argued that tractors did not fall within the systems and sub-systems of launch vehicles as specified in the notification, supporting the denial of exemption.4. Upon review of the certificate, the Tribunal found that it clearly stated the tractors' use in the launch vehicle project for transporting essential materials. The certificate was deemed credible, and the department failed to provide evidence to discredit it. Despite being tractors, their integral role in the launch project made them eligible for exemption under the notification. The Tribunal concluded that the denial of exemption was unjustified, setting aside the impugned order and allowing the appeal with any consequential relief.This detailed analysis covers the issues involved in the judgment, providing a comprehensive overview of the arguments presented and the Tribunal's reasoning leading to the decision.