Site-based exemption for concrete mix used only in one construction project defeats duty demand, limitation, and penalty

Concrete mix prepared at a construction site or at premises made available for a specific project remained covered by the site-based exemption where the entire quantity was used only in that construction work. The Tribunal treated "site" broadly in light of the Board's clarification and held the duty demand unsustainable on merits. It also found no suppression or other facts justifying the extended limitation period, as the department was aware of the manufacture. Because the demand failed on merits and limitation, the consequential penalty on the managing director could not survive independently.

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Issues: (i) Whether concrete mix prepared at the construction site was exigible to excise duty or fell within the exemption for goods manufactured at site and used in the same construction work; (ii) Whether the demand was barred by limitation and the penalty on the managing director could survive.

Issue (i): Whether concrete mix prepared at the construction site was exigible to excise duty or fell within the exemption for goods manufactured at site and used in the same construction work;

Analysis: The product was prepared at a batching plant located near the construction site and the entire quantity was used in the specified construction project. For the relevant periods, the Tribunal applied the earlier decision covering the first segment of the demand and held that the goods were exempt for the later period under the notifications granting relief to goods manufactured at site for use in construction at that site. The expression "site" was understood broadly in the light of the Board's clarification, and the factual setting showed use confined to the construction work for which the premises were made available.

Conclusion: The duty demand was not sustainable on merits; the issue was decided in favour of the assessee.

Issue (ii): Whether the demand was barred by limitation and the penalty on the managing director could survive.

Analysis: The record did not establish suppression or other circumstances justifying invocation of the extended period. The department was aware of the manufacture and the case therefore did not satisfy the requirements for the larger limitation period. Once the demand failed on merits and limitation, the penalty imposed on the managing director under Rule 209A could not stand independently.

Conclusion: The demand was time-barred and the penalty was also unsustainable; the issue was decided in favour of the assessee.

Final Conclusion: The impugned order was set aside and the appeals succeeded on both merits and limitation, with consequential relief against the penalty.

Ratio Decidendi: Where goods are manufactured at premises made available for a specific construction project and are used solely in that project, the site-based exemption applies broadly, and in the absence of suppression the extended period of limitation cannot be invoked.

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