The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) granted relief to Cable Corporation of India by quashing the excise duty demand on the ground of eligibility for Excise duty exemption.
Cable Corporation of India Ltd, the appellant assessee was manufacturer of electric wires and cables supplied to the Space Liquid Propulsion Systems Centre of the Indian Space Research Organisation, Tata Institute of Fundamental Research and Indian Institute of Technology, Mumbai.
The assessee appealed against the order passed by the Commissioner (Appeals) against recovery of duty liability of Rs 1,44,668/- under section 11A of Central Excise Act, 1944, along with applicable interest under section 11AB of Central Excise Act besides imposition of penalty under rule 25 of Central Excise Rules, 2002.
Sachin Chitnis, the counsel for the assessee contended that the assessee cleared on payment of duty and that for the customers enumerated in the order, supplies had been made against certification enabling exemption under the exemption notification.
P K Acharya, the counsel for the department relied on the decisions made by the lower authorities and contended that the assessee was not eligible for exemption under the exemption notification and the demand raised by the department was as per the law and liable to be sustained.
The Bench observed that in the case of K.E.I Industries Ltd, the court held that water supply/treatment plants are eligible for exemption under exemption notifications. The two-member bench comprising Ajay Sharma (Judicial) and C J Mathew (Technical) held that the assessee was eligible for an exemption claim and quashed the excise duty demand.
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