The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the Small Scale Industry (SSI) Exemption allowable for submersible pumps when its final products were manufactured as per the standards of Bureau of Indian Standards (BIS).
Prithvi Pumps, the appellant assessee was engaged in the manufacturing of the final product of submersible pumps and claimed the small-scale industry exemption which was entitled to the assessee.
The assessee appealed against the order passed by the adjudicating authority for denial of SSI Exemption and for raising the demand of duty against the assessee.
P.P Jadeja, the counsel for the assessee contended that there was no evidence adduced by the department that the assessee’s pump was not in conformation to the standards of BIS and the assessee had claimed that though the Certificate was not obtained the assessee’s product i.e. pump had been manufactured as per the standards of the Bureau of Indian Standards.
Also submitted that the certificate could not be obtained, the Exemption cannot be denied so long the product was having the standard of BIS.
P. Ganesan, the counsel for the department relied on the decisions made by the lower authorities and contended that the assessee was not entitled to get the SSI exemption and the demand raised by the revenue was as per the law and liable to be sustained.
The Bench observed that there was no malafide on the part of the assessee with intent to evade payment of duty and the demand under extended period in the present case for the period 01.01.2007 to 18.03.2009, the show cause notice was issued on 04.04.2012 which was much after the normal period of one year, thus the demand was barred by limitation.
The two-member bench comprising Ramesh Nair (Judicial) and Raju (Technical) quashed the demand raised by the department while allowing the appeal filed by the assessee.
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