TaxTMI 
TaxTMI 
2008 (12) TMI 198
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....es for Krishna Drinking Water Supply Project-II by M/s. Hyderabad Metro Water Supply and Sewerage Board. They claimed exemption from payment of appropriate Central Excise Duty under Notification 6/2002-C.E. dated 1-3-2002 as amended by Notification No. 47/2002-C.E. dated 6-9-2002. The assessments were done on provisional basis. The point at issue is the entitlement of the said pipes to the benefit of the exemption notification. Based on Board's instruction dated 28-10-2005, the Revenue restricted the exemption Notification only up to the first storage point. In other words, from the water treatment plant the exemption notification was available only up to the first storage point and not to the subsequent storage point. Consequently, while finalizing the assessment, the Original Authority confirmed the duty demand in the following manner: (a) Central Excise duty of Rs. 1,35,61,265/- and Education Cess amounting to Rs. 2,71,223/- in terms of Section 11A read with Rule 7 of Central Excise Rules, 2002 (b) Central Excise duty of Rs. 4,77,86,964/- and Education Cess amounting to Rs. 9,56,679/- in terms of Section 11A read with Rule 7 of Central Excise Rules, 2002 (c) Demand of i....
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....reover, it is seen that the only ground on which the department has sought to deny the benefit of the Notification in question to the appellants is that the pipes were used for drawing water from one storage point to various other storage points before finally getting stored at the master-balancing reservoir at Gungal, whereas the Notification restricts the exemption to the first storage point. However, on a careful perusal of the Notification in question, it is clear that the term storage facility as mentioned in the Notification is nowhere defined and it must be understood that a storage facility may comprise of any number of clear water reservoirs/storage points enroute from the treatment plant to the last storage point beyond which the treated clear water actually enters into the distribution mode. It would be unfair to restrict the exemption only up to the first storage point, as the Notification nowhere speaks of the first or second storage points. Further, such a narrow interpretation is uncalled for and would defeat the very purpose of the exemption. Similar view was expressed by the Commissioner of Central Excise (Appeals), Kolkata in his Orders-in-Appeal No. 52-68/KL III/....
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.... from payment of Excise duty in terms of the relevant Notifications. 4. Revenue is aggrieved over the impugned order on the following: (i) As per the Notification, the exemption is available to first stage of storage only, the same is evident as a clarification has been incorporated in the notification itself for the subsequent period and such is the intention of the legislature, it is not proper to give interpretation otherwise contrary to the meaning of the notification by the Commissioner (Appeals). (ii) It is mentioned in Revenue's appeal that a reference was made to the District Collector and he has withdrawn the certificate issued in this regard. Subsequently, the District Collector reissued the certificate with a condition that the assessee will undertake to pay the differential duly in the event the department decides the matter against them. They had executed bond and bank guarantee and assessments were made provisional. It is further stated that the Commissioner (Appeals) relied on the following decisions: Electro Steel Casting Ltd. v. CCE, Kolkata - 2006 (202) E.L.T. 165 & Commissioner (Appeals) Hyderabad-III order in the case of M/s. L & T [OIA No. 22/2007 (....
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....tion Notification as it was in its unamended form. Even after storage point. In other words, the amended notification also allows exemption to pipes which are used beyond the first storage point, but in respect of only higher dimension. As regards the ground of the Department that the communication issued by the Jurisdictional Superintendent should not be treated as an appellable order, we are unable to agree with the same. By issuing the said letters the Superintendent sought to deny exemption to the respondents by putting a restriction on the clearance of the pipes for the public utilities concerned. In fact, the Superintendent violated the instructions of the Department in not issuing a Show Cause notice and giving an opportunity of hearing to the respondents before passing a non-speaking order. In such a situation, where the Superintendent put a restriction on the clearance, the respondents had no option but to go to the lower Appellate Authority for Redressal of their grievance. Moreover, under Section 35 of the Central Excise Act, 1944, any person aggrieved by any decision or order passed under the Act by a Central Excise Officer lower in rank than the Commissioner can appeal....