Integrated manufacturing premises and disclosure of installation facts sustained customs exemption and defeated extended limitation.

Imported pipes laid in a continuous slurry pipeline between two units of an integrated manufacturing facility were treated as installed in the importer's factory or premises for Notification No. 64/2008-Cus., because the notification was not confined to a Central Excise-registered factory and the pipeline formed an essential part of the captive production chain. The Tribunal also found no suppression, as the importer had disclosed the EPCG licences and the installation position, including the portion outside the factory area, so the extended period under Section 28 of the Customs Act, 1962 was not available. The demand and penalties were set aside, and concessional duty was upheld.

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Issues: (i) whether imported pipes installed in a continuous slurry pipeline connecting two units of an integrated manufacturing facility were installed in the importer's factory or premises so as to qualify for concessional duty under Notification No. 64/2008-Cus.; (ii) whether the demand was barred by limitation under Section 28 of the Customs Act, 1962 for absence of suppression.

Issue (i): whether imported pipes installed in a continuous slurry pipeline connecting two units of an integrated manufacturing facility were installed in the importer's factory or premises so as to qualify for concessional duty under Notification No. 64/2008-Cus.

Analysis: The notification required the capital goods to be installed in the importer's "factory or premises" and did not confine installation to a Central Excise-registered factory alone. The pipeline formed part of an integrated manufacturing process linking the beneficiation plant and the pellet plant, and the importer had right of way over the land on which the pipeline was laid. The issuance of export obligation discharge certificates by DGFT and the cancellation of bond and bank guarantee by Customs were treated as consistent with fulfillment of the licence and notification conditions. The reasoning on integrated units and captive use supported treating the slurry pipeline as part of the manufacturing premises for exemption purposes.

Conclusion: The issue was decided in favour of the assessee; the pipelines were held to be installed within the factory or premises for the purpose of Notification No. 64/2008-Cus.

Issue (ii): whether the demand was barred by limitation under Section 28 of the Customs Act, 1962 for absence of suppression.

Analysis: The importer had disclosed the EPCG licences and the installation position, including the fact that part of the pipeline would lie outside the factory area. On that basis, the Tribunal found no suppression of facts and no basis for invoking the extended period. Since the demand itself failed on merits, the limitation objection independently reinforced the unsustainability of the confirmation and penalties.

Conclusion: The issue was decided in favour of the assessee; the extended period was held to be not invocable.

Final Conclusion: The impugned order was set aside and the appeal was allowed, with the importer held entitled to concessional duty under the EPCG notification.

Ratio Decidendi: Where an integrated manufacturing facility uses a pipeline as an essential and continuous part of the production chain and the goods are installed within the importer's broader premises, the requirement of installation in the "factory or premises" under the exemption notification is satisfied; in the absence of suppression, the extended limitation under customs demand provisions cannot be invoked.

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