2017 (4) TMI 313

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....ed for registration of their contract for installation of water treatment plant for supplying treated water for industrial use for power plant of Gujarat State Electricity Corporations; respondent claimed benefit of Notification No. 14/2004-Cus and 3/2004-CE; respondent claimed classification of the resins to be registered under Project Import under Customs Tariff Heading No. 9801, on the ground that these resins were components/integral requirement of water demineralization of plant. Adjudicating authority rejected the contentions of respondent herein and denied the benefit of project import. Aggrieved by such an order an appeal was preferred before first appellate authority. By the impugned order the first appellate authority set aside th....

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....r (Appeals) that even if the Resins are considered as consumables these are well within the 10% of the value of the goods is therefore not correct. c) The Commissioner (Appeals) reliance on the Hon'ble CESTAT order in the case of Sunrise Zinc Ltd. Vs. Commissioner of Central Excise 2005 (192) E.L.T. 306 (Tri-Mumbai) is also not correct. The said case relates to availment of Modvat on DEHPA, a chemical which was imported under the Project Import. The DEHPA is recycled in the plant continuously and remain in the plant for the entire life of the plant. In the present case Resins do not remain in the plant for the entire life of the plant. Moreover in the present case resin is the only item, that was to be imported under Project Imports.....

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....ay of backwashing with brine (salt solution), and thus the ion-exchange resin material is used over and again (page. 143). Ion-exchange materials are basic components of ion-exchange process. As per the arrangement shown in "Vertical -Downflow Ion-Exchange Unit" , water passes through "cation exchange resin bed", which is supported on plastic disc strainers. It is seen that resin bed is an integral part of the Ion-exchange unit (page. 147). During operation of the ion-exchange process for softening, influent water passes downward through the bed of ion-exchange material to the effluent (page. 149). As per operating problems of the ion-exchange softening process mentioned therein, Polystryrene resins can generally be expected to serve for 15....

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....f the lower authority that Ion-exchange resins are consumables is not factually correct. The lower authority has not given any finding as to how the ion-exchange resins are consumed during water treatment process. As per Explanation to Sr.No. 26 A of Notification 42/96-Cus "water supply project includes a plant for desalination, deminenalisation or purification of water or for carrying out any similar processor processes intended to make the water fit for Agricultural or industrial use". In view of said Explanation, Ion-exchange resin forming resin bed in the softening unit for deminaralisation, are eligible to Project Import benefit, in my opinion. 8. In similar situation regarding: use of chemical as media, in electrolysis process, proj....