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of <h1>CESTAT Bangalore: Appeals Allowed for Water Purifier Manufacturer. Central Excise duty demand set aside.</h1> The Appellate Tribunal CESTAT Bangalore allowed the appeals filed by the water purifier manufacturer, setting aside the demand for Central Excise duty, ... Functional based exemption from duty - Aquasure on Tap Water Purifier - Aquasure Storage Water Purifier-US Tech - benefit of N/N. 6/2007 dated 1.3.2007 availed - requirement of external pressure to water purifiers or not - demand of duty alongwith interest and penalty - HELD THAT:- The Revenue’s doubt vide its show-cause notices have been effectively rebutted by the Analytical Report issued by a neutral party wherein it has been categorically clarified that the water purifiers in question do not use any kind of external pressure. It has also been clarified that the water purifiers in question work on gravity flow and do not require electricity, pump or pressurised vessel for purifying water to produce portable water. The Notification in question only mandates that the water filters should function without electricity and pressurised tap water. We have gone through the user manual in respect of both the models which are placed on record, from which we do not see either of the models requiring any electricity or pressurised tap water for functioning. Other than mere suspecting, even the Revenue has not adduced any sought of evidence to dislodge the mode of functioning explained in the user manual. The water purifiers in question function without electricity and pressurised tap water, they satisfy the conditions of the Notification in question - Appellant are entitled for the benefit of Notification in question - appeal allowed - decided in favor of appellant. Issues:- Appellant manufacturing water purifiers claimed exemption under Notification No.6/2007.- Revenue doubted functionality of water purifiers and issued show cause notices.- Adjudicating authority confirmed demand for Central Excise duty, interest, and penalty.- First appellate authority confirmed demand for two products.- Appeal filed before Appellate Tribunal CESTAT Bangalore.Analysis:The appellant, a manufacturer of excisable goods, specifically water purifiers, faced allegations from the Revenue for manufacturing and clearing seven water purifier models without paying Central Excise duty by claiming exemption under Notification No.6/2007. The Revenue doubted the functionality of the water purifiers, claiming they only work with pressurized tap water. Show cause notices were issued, proposing demand for Central Excise duty, interest, and penalties. The appellant provided a detailed reply, supported by an Analytical Report from a Technical Expert, refuting the Revenue's claims. However, the adjudicating authority upheld the demand, leading to the appellant filing appeals before the first appellate authority, which confirmed the demand for two products - Aquasure on Tap Water Purifier and Aquasure Storage Water Purifier-US Tech, prompting the appeals before the Appellate Tribunal.During the hearing at the Appellate Tribunal, both parties presented their arguments, and the Tribunal carefully examined the documents on record. The Tribunal noted that the Revenue's doubts were effectively rebutted by the Analytical Report, which clarified that the water purifiers in question do not require external pressure and operate on gravity flow without the need for electricity, pump, or pressurized vessel. It was highlighted that previous appeals for different periods had been allowed based on similar expert reports. Moreover, the Tribunal found that the user manual for the models did not indicate a requirement for electricity or pressurized tap water for the purifiers to function. Despite the Revenue's suspicions, no evidence was presented to contradict the functioning explained in the user manual.Based on the evidence and analysis, the Tribunal was satisfied that the water purifiers met the conditions of the Notification by functioning without electricity and pressurized tap water. Consequently, the Tribunal set aside the impugned orders, allowing the appeals with any consequential relief as per the law. The judgment was pronounced in Open Court on 23/09/2021.
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