TaxTMI 
TaxTMI 
2017 (11) TMI 879
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....estion of law:- "(i) Whether the Tribunal was correct in law in interpreting notification No.63/95-CE dated 16.03.1995 and holding that the appellant is not entitled to claim exemption under notification No.63/95-CE dated 16.03.1995 from Central Excise duty on the goods supplied to Bharat Earth Movers Ltd. (BEML) for further supplying to Ministry of Defence and is liable for payment of Central Excise duty amounting to Rs. 22,49,354/- such conclusion is legally sustainable in the eye of law?" 2.1 When the matter was last listed before the court, counsel for the appellant has argued the matter at length and counsel for the respondent sought time to verify whether Circular dt. 23.6.2006 is applicable in the case of appellant or not. 3....
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....he course of audit, it was revealed that the appellants had cleared Bearings Axle Box without payment of excise duty and education cess amounting to Rs. 22,49,354/- supplied to M/s BEML during the period from November, 2004 to June 2005 and had sought to claim exemption under Notification No.63/95-CE dated 16.03.1995. 3.2 The counsel for the appellant relied on the certificated dated 6.3.2005 which reads as under: REF:- RMA/WA/81/88/756607 Date:06-03-2005 TO WHOMSOEVER IT MAY CONCERN The Ministry of Defence has placed order on M/s. Bharat Earth Movers ltd. (herein after referred to as BEML) for the manufacture of the following equipment under respective tariff headings: EQUIPMENT: BFAT WAGON: TARIFF HEADINGS: 9505.00 Th....
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....plying goods to Bharat Earth Movers Ltd. The Appellant has also contended that, the Notification No.63/95 has replaced the Notification No. 184/86, the Trade Notice and instruction applicable on that Notification would also be applicable in the case in this regard. I find that, the Adjudicating Authority has conducted enquiry at the buyer's end and come to conclusion that the goods supplied by the Appellant were not cleared to defence. This fact has not been challenged by the Appellant. I agree with the Appellant contention that, benefit of circular 5/92 is applicable for the purpose Notification No. 63/95. But in the instant case, the benefit has been denied on the ground that the goods supplied by the Appellant to M/s BEML has not bee....
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....or official purposes. Obviously, therefore, in order to claim exemption under the said Notification, it is not sufficient that the goods are manufactured by the units mentioned in the said column, but such goods must be supplied to the Ministry of Defence. Mere supply of goods to the Ministry of Defence is also not sufficient, but such supply must be for official purposes. In short, there are three conditions specified in the said column. Firstly, the goods must be manufactured by the units specified. Secondly, the goods must be supplied to the Ministry of Defence. Thirdly, goods must be supplied to the Ministry of Defence for official purposes." 3.5 He has relied upon the circular which has been issued on 23.6.2006 which is produced for....
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....Defence. 2. The issue has been examined. It is seen that though notification No. 184 / 86 was subsequently superseded by notification No. 63 / 95 dated 16.03.1995 the wording and the content of both the notifications are the same. Therefore, the Board's circular No. 5 / 92 dated 19.05.1992 is applicable to the notification No. 63 / 95 dated 16.03.1995. However, in cases as quoted above, the first unit is not a job worker of the second unit, hence strictly, the said circular may not be applicable. However, both these units are covered under the said notification and goods are ultimately supplied for use by Ministry of Defence. Therefore, it is clarified that even if goods are cleared / sold by the first unit to the second unit, it is cove....