NEZONE TUBES LTD. Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS is an Application filed seeking waiver of pre -deposit of Central Excise duty of Rs. 1,39,786/ -, interest (not quantified) and the penalty of equal amount imposed on the assessee under Section 11AC of the Central Excise Act, 1944. The ld. Consultant appearing for the applicant has submitted that the assessee during the month of August, 2009 and September, 2009 had supplied GI pipes valued at Rs. 16,96,436/ - involving duty of Rs. 1,39,786/ - without payment of duty in terms of Notification No. 108/95 -C.E., dated 28 -8 -1995. It is submitted that the benefit of this Notification was denied mainly on the ground that the certificate produced by the designated authority did not specify that the said project has been approved by the Govt. of India for implementation by the State Govt., which is very much essential in view of the text of the Notification No. 108/95 -C.E., dated 28 -8 -1995 as amended. The ld. Consultant submits that it is evident from Para 6 of the order of the lower authority that all the essential ingredients of the above notification was fulfilled in this case except that the project was not approved by the Govt. of India. He invited attention to the certificate granted by the Secretary to the Government, Finance Deptt., Govt. of Tamil Nadu, Chennai at page 13 of the paper book which shows that the work was executed under World Bank assistance vide Loan No. LN 4798 -IN. On the said certificate name of the applicant has been shown for supply of the materials under the above project. It is the contention that without approval of the Govt. of India no loan can be sanctioned. It is therefore evident that in the present case all the conditions of the impugned Notification were fulfilled. It is further submitted that demand is barred by limitation inasmuch as the show cause notice was issued beyond a period of one year from the relevant date.

(2.) AS per contra the ld. AR for Revenue reiterated the findings of the ld. Commissioner (Appeals). He submits that the certificate produced by the applicant does not clearly indicate that the project has been approved by the Govt. of India for implementation by the State Government and therefore the assessee is not eligible for availing the exemption provided under the Notification No. 108/95, dated 28 -8 -1995. After hearing both sides we find that the Notification No. 108/95 as amended exempts the goods supplied to an international organization listed in the Annexure appended below, the said Notification for use in a project that has been approved by the Government of India and financed (whether by a loan or a grant) by such an organization. The Notification stipulates that exemption Notification would be available provided a certificate is produced from such an organization that the said goods are required for the execution of the said project and that the said project has duly been approved by the Government of India. The exemption is also available for the goods supplied to a project that has been approved by the Govt. of India and financed whether by a loan or a grant by an international organization. It is a case of the applicant that it is not in dispute that the impugned goods were supplied to Tamil Nadu Water Supply and Drainage Board for execution of the project under the World Bank assistance. It has been submitted that the loan is sanctioned by the World Bank only on approval of the project by the Govt. of India and therefore all the conditions of the Notification has been fulfilled. We find that the name of the assessee is specifically appearing on the certificate issued by Secretary to the Government, Finance Deptt., Govt. of Tamil Nadu, Chennai. In view of these facts, prima facie we are of the opinion that the applicant has been able to make out a case for full waiver of the pre -deposit. Under these circumstances we waive requirement of pre -deposit and stay recovery thereof during pendency of the appeal. Stay petition allowed.