TaxTMI 
TaxTMI 
2004 (6) TMI 128
X X X X Extracts X X X X
X X X X Extracts X X X X
....0 for the period from January 2001 to December 2002. The department not being satisfied with the order of Deputy Commissioner, filed an appeal before the Commissioner (Appeals) who passed the impugned order and held that appellants are not entitled to exemption under Sl. No. 251 of Notification No. 6/2000. 3. Shri V. Lakshmikumaran and Shri G. Shivadass, Advocates, appeared for the appellants. It was pleaded that Sl. No. 251 of Notification No. 6/2000-C.E., dated 1-3-2000 and Sl. No. 237 of Notification No. 6/2002-C.E., dated 1-3-2002 exempts non-conventional energy devices/systems specified in Lists 5 & 9 respectively from payment of excise duty. S. No. 16 in List 9 indicates that the items covered are agricultural, forestry, agro-industrial, industrial, municipal and urban wastes conversion devices producing energy. The wordings in this Notification are more or less identical to the wordings in earlier notification like Notification 120/81-C.E., dated 15-3-1981 and Notification No. 205/88, dated 12-5-88 excepting that earlier only agricultural and municipal wastes were sought to be covered as sources whereas presently other types of wastes like forestry industrial wastes etc., a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... from one medium to another whereas turbine transfers energy from one form to another i.e. from heat to mechanical work. The steam turbine used in bio-mass based power projects are specially designed and tailor made for these projects. The steam can be fluctuating both in terms of temperature as well as pressures and even the flow of steam could vary unlike standard fuels such as coal, coke, lignite or petroleum fuels where the temperature/pressure generated is consistent. The turbine used in the present case should therefore be capable of withstanding the fluctuations and give corresponding power at a constant out put. Therefore the turbines are custom designed to take care of this feature of bio-mass fuel. CEBC vide Circular dated 19-5-1992 has clarified that if boiler is specifically designed for converting agricultural and municipal waste, it would be eligible for Notification No. 205/88 (predecessor of present Notification). Similar view was taken by the Tribunal in the following cases. (a) CCE, Coimbatore v. Jaya & Company [2000 (121) E.L.T. 433] (b) CCE, Chennai v. Megatech Control Pvt. Ltd. [2002 (145) E.L.T. 379] (c) CCE, Ahmedabad v. Boiler Tech Engineers [2002 (147....
X X X X Extracts X X X X
X X X X Extracts X X X X
....natural energy source is not a non-conventional source even though the ultimate energy produced is electrical energy. From this list it is clear that function of the device covered by this Notification should be conversion and the source of energy to be converted should be non-conventional. There are various non-conventional energy sources namely solarthermal, solarphotovoltaic, wind, waves, sea currents, ocean thermal energy and energy from agricultural wastes. As against this the conventional sources of energy are coal, oil, gas, water and nuclear. The boiler can use any kind of fuel both conventional and non-conventional. When conventional fuel such as bagasse or other waste is used for the boiler the calorific value existing in the bagasse combined with air when ignited produces heat which converts water into steam. This steam produced in the boiler which is a form of thermal energy is the input for turbine where it gets converted to rotational or kinetic energy for rotating the alternator to produce electricity. Steam is not just a working medium but it contains latent heat which gets converted to kinetic energy. Turbine does not use any of the non-conventional energy sources.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ses wastes as an input can be so termed. The device which is cleared by the appellants cannot convert waste into energy. Therefore the benefit of Notification No. 6/2000-C.E. cannot be extended to such turbines. 5. We have carefully considered the submission made by both the sides. We find that the issue involved in this appeal is whether turbine is eligible for exemption under Notification No. 6/2000-C.E., dated 1-3-2000. We find that the appellants have claimed exemption under Sl. No. 251 of the table attached to the said Notification Sl. No. 251 reads as under : Serial No. Chapter Heading Particulars Duty 251 Any chapter Non-conventional energy devices/ systems specified in List 5 Nil Sl. No. 16 of the List 5 is "Agricultural, forestry, agro-industrial, municipal and urban wastes conversion devices producing energy. Thus it is clear that exemption is only to these devices which are using agricultural, forestry, agro-industrial, industrial, municipal and urban waste for converting these into energy. The Appellants are supplying steam turbines to M/s. Malavalli Power Plant Pvt. Ltd., for their bio-mass based power project to be set up at Mandya district. In this project....