TaxTMI 
TaxTMI 
2022 (5) TMI 647
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....: "8. In the light of the aforesaid discussion, I find that the reliance of the aforesaid judgments on behalf of the Revenue is quite appropriate. The enunciation of law as laid down in the citations clearly goes to show that the mounting structures, supplied by the appellants, cannot be considered as 'component' of a solar power generation project or facility. As regards the contention of the appellant that the demand is time barred. I find that the appellant never informed the department about the admissibility of exemption under Notification No.15/2010-CE and I do not find any substance in defence submissions made by the appellant." 3. Mr. Mehul Jiwani, learned Chartered Accountant appearing for appellant would submit that it was noticed by the department, during an audit conducted, that the clearance of galvanised solar structure (module mounting structure hot dip galvanized structure) falling under Central Excise Tariff Heading [CETH] 7308 2019 was being done by availing the benefit of exemption notification as amended on 08.05.2012. The appellant availed the benefit of the exemption notification after being duly permitted by the competent authority in terms of the said not....
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....al Pvt. Ltd. vs. Commissioner of C. Ex., Raipur [2014 (308) ELT 106 (Tri.-Del.) ] v. Atmasco (P) Ltd. vs. Commissioner of C. Ex. & Cus., Raipur [2016 (334) ELT 122 (Tri.-Del.) ] vi. Phoenix Construction Technology [2017 (359) ELT 241 (Tri.-Ahmd.)] vii. C.C.E., Nagpur vs. Hyundai Unitech Electrical Transmission Ltd. [2015 (323) ELT 220 (SC)] viii. Rakhoh Enterprises vs. Commissioner of Central Excise, Pune [2016 (338) ELT 449 (Tri.-LB)] 7. Learned Chartered Accountant submits that in terms of notification, the liability, if any, would be on the promoter and not on the manufacturer and in case of non-compliance of condition under the notification, the project developer shall be liable to pay the duty which was not paid on account of exemption at the time of clearance. Further, as per Clause (d) of the Certificate issued by the Ministry of New and Renewable Energy Resources, the customer of the appellant has undertaken to pay the duty in case of non-compliance and the Commissioner, Hyderabad vide order cited above has held that as per the condition of the notification, the liability to pay duty is on the customer and not on the appellant. 8. He would submit that the case law....
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....ent since they are used in solar power generation or solar energy production project and is an integral part of the entire plant is not correct inasmuch as mounting structure cannot be considered as 'component of a solar power generation project or facility in view of the proposition of law enunciated by the Courts in the cases cited below, which have been relied upon by the Commissioner (A). He submits that there is a plethora of judgments that an exemption notification has to be read strictly. In Commissioner of Customs (Import), Mumbai vs. Dilip Kumar and Company & Others, the Supreme Court held that exemption notification should be interpreted strictly and the burden of proving applicability would be on the assessee to show that his case comes within the parameters of the exemption clause or exemption notification. Further, when there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the assessee and it must be interpreted in favour of the revenue. The contention is that the above proposition of law is also applicable to the present case and the exemption notification is not available to the appe....
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....roject or facility and not for any other use; and (b) in the event of failure to observe conditions above, the manufacturer shall pay the duty which would have been leviable at the time of clearance of goods, but for this exemption.". Notification No.26/2012-CE dated 8.5.2012: Exemption to machinery items, etc. for initial setting up of solar power generation project or facility - Amendment to Notification No. 15/2010-C.E. In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 15/2010-Central Excise, dated the 27th February, 2010, published in the Gazette of India, Extraordinary vide number G.S.R. 117(E), dated the 27th February, 2010, namely :- In the said Notification, for conditions (1) and (2), the following shall be substituted, namely: - (1) an officer not below the rank of a Deputy Secretary to the Government of India, in the Ministry of New and Renewable Energy rec....
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....bout the applicability of Cenvat Credit on iron and steel products used for fabrication of structures used in the factory, Bharti Airtel is about the applicability of credit on towers used for mounting the antennas. 17. The facts of both the cases, relied upon by the revenue, are entirely different than those involved in the impugned case before us. Availability of exemption under any notification was not the subject matter of the cases. Applying the ratio of judgment in cases wherein the facts are different would not be appropriate. Moreover, Bharti Airtel has been discussed and not relied upon by Delhi High Court. Be that as it may, it can be argued that the antennas can be fixed on high rise buildings also. However, in the present matter, it is nobody's case that the solar panels can be fixed to the floor on solar farms or on the ground of the top floor of the buildings. The fabricated structures are used not only to keep the solar panels secured form the vagaries of nature but also to keep them in a particular angle to maximise energy production. This being so, the Module Mounting Structures are essential to the initial set up and functioning of the solar system and therefore,....
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.... the benefit of exemption notification. This view get support from the decision of this Tribunal in Lotus Power Gear Pvt. Ltd. [2009 (248) E.L.T. 919]. The Tribunal held that: "3. On a careful consideration of the issue we do not find that the Revenue has made proper grounds for appealing against the impugned order. So long as the competent authority has certified that they are necessary in the use of scientific and technical appliances, the exemption cannot be denied. Moreover, the Commissioner has given detailed justification for extending the benefit. The findings of the Commissioner (Appeals) are reproduced below: "The items cleared by the appellant are switch gears and control panels and the same are cleared to public funded research institutions against a valid certificate issued to them by research institutions who have made the indent for the goods. The appellant also contends that the aforesaid items are essential parts to the main scientific equipment. The adjudicating authority in his findings in the impugned order have fairly conceded that the certificates issued are valid and are issued by public funded research institutions and the transactions/receipt etc., are n....
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....es cannot be questioned as held by CESTAT Bangalore Bench in their recent judgment [Andhra Sugars Ltd. v. CCE Guntur - 2005 (71) RLT 659]. Further in a similar case involving items viz., controllers and switches for making a Dusk dawn system for street lights, recently the CESTAT, Delhi have allowed the exemption under GOI Notification No. 6/2002 [Rajasthan Electronics & Instruments Ltd. v. CCE, Jaipur - 2005 (68) RLT 352]. The same analogy can be drawn to the present case and exemption benefit can be allowed to the appellant which they are eligible. Therefore, the appellant is eligible for the exemption for the impugned clearances under the said notification". The Order appears to be well reasoned. Hence, we uphold the same and reject the Revenue's appeal." 20. The issue of availability of exemption to support steel structures is no longer res integra. The Ahmedabad Bench of the Tribunal has gone into the very same issue in Phenix Construction Technology [2017 (358) ELT 241 (Tri.-Ahmd.)]. The Bench examined as to whether the structures are 'components' of solar power project/facility and held that support steel structures for mounting / holding reflectors/mirrors is to be consi....
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.... and spare parts of wireless equipments and radiographs was considered. The question was whether radio cabinets sold by a dealer would attract entry 65 or the residuary entry 22. It was held that while the word "part" has a general sense, "spare part" takes colour from the word "spare", that is a part which would require replacement in ordinary course on account of wear and tear and would not have the amplitude of the word "component". It was indicated that the owner of radio will not ordinarily keep an extra cabinet spare and, therefore, cabinet cannot be regarded as a spare part, though it is a component of radio and, therefore, entry No. 65 would not apply. In Commissioner of Sales Tax v. Pritam Singh - 1968 (22) STC 414 (All. HC) the question arose in the context of manufacture of bodies of motor vehicles. Item 24 of the exemption notification referred to motor vehicles and component parts of motor vehicles. It was held that a component part of an article is an integral part necessary for the constitution of the whole article and without it the article will not be complete and body of a motor vehicle being an integral part of the motor vehicle has to be regarded as a component ....
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.... State of Madras v. R.M.K. Krishnaswami Naidu and Others - 1970 (26) STC page 42 has taken a similar view. In State of Tamil Nadu v. Tube Investments of India Ltd. - 1992 (85) STC 245 (Madras HC) it was held that dynamo of a cycle is not a component part but an accessory of cycle. In Televista Electronics v. Commr. of Sales Tax - 1992 (87) STC 410 (Delhi HC) in considering the entry relating to wireless receiving instruments and spare parts and accessories in the schedule to the Bengal Finance (Sales Tax) Act, it was held that a spare part is always a component part but the converse may not be invariably true. 15. In Star Paper Mills Ltd. v. Collector of Central Excise - 1989 (43) E.L.T. 178 (S.C.), the Supreme Court held that paper core used for rewinding of paper in rolls is a component part within the meaning of Notification No. 201/79. The Court relied on the dictionary meaning of the word "component" as "a constituent part". Since use of paper core is necessary for rewinding of paper if delivered to the customers in rolls, it should be a component part within the meaning of the Notification. 16. Notifications 246/76, 77/90 and 112/87 do not define the word "component part"....
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....n its normal connotation, in the absence of any specific qualification or restriction. There are several notifications where such qualifying or restrictive words have been used to suggest that the component part must have been used in the initial assembly or in the manufacture of the final product thereby excluding "spare" from the ambit of the expression "component part". There are no such qualifying or restrictive words used in the notifications under consideration. Hence, with respect, it is not possible to agree with the view taken in some of the decisions of the Tribunal that "component" implies parts used in the initial assembly or manufacture and excludes "spares". The amplitude and significance of the word "component" cannot be cut down in the absence of clear words indicative of any intention to restrict its meaning and operation. The view taken in Vaz Fowarding Pvt. Ltd. - 1989 (43) E.L.T. 358 (Tribunal) was not followed in Metal Impacts Pvt. Ltd. - 1993 (64) E.L.T. 286 (Tribunal), but the distinction drawn based on the fact that the words "component parts" occur in isolation and not in conjunction with the final product is a distinction without difference. The amplitude ....
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....nt that the items in question definitely be considered as 'components' of the reflector, undisputedly used being required for initial setting up of a solar power generation project or facility, hence eligible to the benefit of exemption Notification No. 15/2002C.E., dated 27-2-2010, as amended." 21. Now we turn our attention to the other issues involved. The appellant has vehemently submitted that they have cleared the goods on the basis of the exemption notification on a certificate to this effect having been issued by the Competent Authority in the Ministry of New and Renewable Energy Resources. They have submitted the certificate to the jurisdictional Central Excise authorities before effecting the clearance and therefore, no suppression or misrepresentation can be alleged and the extended period cannot be invoked. They submit that for this reason, the demand prior to 31.1.2016 is beyond the normal period of limitation. 22. There is force in the submission of the appellant. When the clearances are intimated to the department, it is not open to the department to invoke the extended period as no fraud, collusion, suppression, etc., has been brought on record, as held in the case....