Ready Mix Concrete exemption dispute resolved: RMC held ineligible under identically worded exemption, time-bar protected later period relief.

Ready Mix Concrete (RMC) exemption under area-based Notification was considered vis-à-vis precedential interpretation that RMC is not covered by identically worded exemption entries; in consequence the product is ineligible for exemption as held by the cited authority, and that ineligibility informs liability for the earlier period. Separately, adjudication found no suppression of facts by the assessee, so extended period demands are time barred and the demand for April 2016June 2017 was rightly dropped on merits. Other exemption claims were not addressed.

---

---

Issues Involved:
1. Eligibility for exemption under Notification No.12/2012-CE dated 17.03.2012 for Ready Mix Concrete (RMC) for the period April 2014 to September 2015.
2. Invocation of the extended period for confirmation of demand under Section 11A(4) of the Central Excise Act, 1944.
3. Eligibility for exemption under Notification No.67/95-CE dated 16.03.1995 for RMC manufactured and used captively at the site.
4. Eligibility for concessional duty rate of 2% under Notification No.1/2011-CE dated 01.03.2011.
5. Eligibility for exemption under Notification No.12/2016-CE dated 01.03.2016 for the period April 2016 to June 2017 for RMC manufactured and used at the site.

Detailed Analysis:

1. Eligibility for Exemption under Notification No.12/2012-CE:
The Hon’ble Supreme Court in the case of LARSEN & TOUBRO LTD. Vs. CCE (2015) held that the exemption under Notification No.4/97-CE, which is identically worded to Sr. No.144 of Notification No.12/2012-CE, is inapplicable to Ready Mix Concrete (RMC). The court concluded that RMC is not the same as Concrete Mix, and the exemption is granted only to Concrete Mix, not RMC. Consequently, the assessee’s product, RMC, is not eligible for exemption under Notification No.12/2012-CE dated 17.03.2012 (Sl.No.144).

2. Invocation of Extended Period for Confirmation of Demand:
The issue of limitation is based on the facts of each case. The assessee had a bonafide belief in their eligibility for the exemption based on previous judgments in their favor, such as CHIEF ENGG. RANJIT SAGAR DAM and SIMPLEX INFRASTRUCTURES LTD. The assessee regularly filed ER-1 returns, declaring the product as "Concrete Mix/Ready Mix Concrete" and claiming the exemption under Notification No.12/2012-CE. This explicit disclosure in ER-1 returns and invoices indicates no suppression of facts. The department's failure to act on this information within the normal period negates the allegation of suppression with intent to evade duty. The entire demand is under the extended period and is thus time-barred.

3. Eligibility for Exemption under Notification No.67/95-CE:
The adjudicating authority rejected the claim for exemption under Notification No.67/95-CE, stating that RMC and civil construction work are not considered capital goods as defined under Rule 2(a) of the Cenvat Credit Rules, 2004. Therefore, the benefit of Notification No.67/95-CE dated 16.03.1995 is not available to the assessee.

4. Eligibility for Concessional Duty Rate of 2%:
The assessee claimed that the demand, if any, should be confirmed at the concessional rate of 2% under Notification No.1/2011-CE. The adjudicating authority found no documentary evidence of reversal of proportionate credit and that the procedure prescribed under the Cenvat Credit Rules, 2004, was not followed. Hence, the claim for a concessional rate of duty was rejected.

5. Eligibility for Exemption under Notification No.12/2016-CE:
Notification No.12/2016-CE exempts RMC manufactured at the site of construction for use in construction work at such site. The revenue argued that the exemption is only available if the entire RMC manufactured at the site is used at the site. The adjudicating authority correctly held that the exemption applies to the quantity of RMC used at the construction site, and the quantity cleared outside the factory is chargeable to excise duty. The department's appeal on this ground was dismissed, and the adjudicating authority's decision to extend the benefit of the exemption for the period April 2016 to June 2017 was upheld.

Conclusion:
The assessee's appeal is allowed, and the revenue's appeal is dismissed. The demand is time-barred, and the assessee is entitled to the exemption for the period April 2016 to June 2017. The adjudicating authority's decision is modified accordingly.

---