Castable Refractory Goods Supplied to Power Projects are Eligible for Exemption from Excise Duty under Exemption Notification: CESTAT [Read Order]

The Chandigarh bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the goods of castable refractory which was supplied to power projects are eligible for exemption from the central excise duty under exemption notification. 

Souvenir Ceramics, the appellant assessee engaged in the manufacturers of castable refractory goods and has supplied goods to the Bhusawal Thermal Power Station Project and claimed that they had paid Central Excise duty by mistake, they filed a refund claim for Rs.1,45,742/- because the supplies were against International Competitive Bidding. 

The Commissioner (Appeals) rejected the refund claim of paid excise duty filed by the assessee based on the supply of power projects. 

Vivek Kumar, the counsel for the assessee contended that “Ministry of Power has clarified that the Mega/Ultra Mega power projects wherein the capacities of many units total up to at least 100 MW in one go are eligible to get the requisite benefits under mega status certificates”. 

Also submitted that the assessee are eligible for exemption under Notification No.20/2002 as the goods were supplied to power projects and eligible for the refund of excise duty paid by mistake. 

Ravinder Jangu, the counsel for the department relied on the decisions made by the lower authorities and contended that the project had two different units of 500 MW each whereas the exemption applied only to power projects of a capacity of 1000 MW. 

The Bench observed that once the department had accepted non-payment of duty for the previous and subsequent periods, it was not open for the Department to deny the refund, if otherwise in order, for the short period during which the assessee had paid duty under the mistaken notion of law. 

The two-member bench comprising S.S Garg(Judicial) and Anjani Kumar (Technical) quashed the rejection of the refund claim filed by the assessee while allowing the appeal filed by the assessee. 

To Read the full text of the Order CLICK HERE

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