ORDER
Shri S.S. Sekhon
1. This appeal is filed by a voluntary N.G.O., recognised by the Government of Maharashtra, which took up the construction of houses for the victims of earthquake in latur, Maharashtra in 1993.
2. The appellants had purchased 1288.50 MT of Cement from M/s ACC Ltd., and got it despatched to earthquake devastated area, where it was used. They had obtained duty paid cement from the manufacturers M/s ACC Ltd/., Wadi under the jurisdiction of Asstt Collector of Central Excise, Gulbarga. They filed a refund claim for the duty of Rs. 4,25,205/- on cement so used. There was a time lag in the issue of Nos 97/93 dt 19.10.93 and its amendments No. 128/94 dt 7.9.94 and its actual receipt by M/s ACC ltd and by the appellants;
3. They applied for the refund of duty borne, suffered by them to the Assistant Collector, Gulbarga in whose jurisdiction Wadi factory is located. The Assistant Collector admitted the claim in his appeal and a S.C.N. dt 31.03.95 was issued to the appellants as to why the refund of Rs. 4,25,205/- claimed by them should not be rejected on the ground that they are not eligible for the exemption from duty by notification 97/93 dt 19.10.93 as amended 128/94 dt 7.9.94, as also the claim does not conform to the said notification.
4. The Assistant Collector, found, that the appellants donot satisfy the conditions of the notification and therefore rejected the claim. The Commissioner (Appeals) after hearing the party and considering the matter found—
“In fact both the conditions of the notifications have not been complied with. The first is that no certificate, by the manufacturer that the goods are intended to be donated, has been furnished on the clearance documents. Secondly, the goods have not been sent directly from the factory but were sent from the factory to the depot i.e. at Latur Maharashtra and thereafter to the relief agency.”…….
Therefore, holding these conditions to be substantive and relying upon Hansraj Gordhands (ECR C 274 SC) and rejecting the claim of reliance of appellants on Parle Exports 1988(38) ELT 741 sc), he rejected the refund, vide his Order dt 27.5.97 now in appeal before us.
5. WE have heard both sides and after considering the matter find:
a) Examining the finding of the Commissioner (Appeals) on the first ground i.e. “No certificate by the manufacturer that the goods are intended to be donated has been furnished on the clearance documents” we find this condition in the notification 28/94 dt 7.9.94 reads-
i)” that it is certified by the manufacturers of such goods on the relevant clearance documents that the goods are intended to be donated for the relief and rehabilation of the people affected by the earthquake in the said states without making any charge thereof”
A plain reading of the same, indicates to us, that such an endorsement is required to be made only when ‘no charge’ for the goods have been made. In the case before us, the appellant has paid for the good i.e. Cement. This payment is for cost of ‘goods purchased’ which are also exempted from duty by the notification, and such goods will obviously would be charged for and the endorsement as required cannot be made in tall on the manufacturers documents as stipulated in the notification. Therefore, it cannot be said that, when goods are purchased with only cash donations for relief from a manufacturer they will not be eligible for the benefit of the notification ‘since the declaration on the clearance document cannot be affected in ‘full measure.’ Therefore, to our mind, this stipulation is procedural in aspect, can be ignored, as it is not a substantial requirement of the notification as arrived at by the Commissioner (Appeals). Such failure of procedural requirements, cannot deny the substantive benefit of exemption, if goods are used for earthquake relief as certified by the District Magistrate, who in this case has issued such a certificate. The learned Advocate has submitted before us that the appellant has procured a certificate from the manufacturer separately to the same effect. Therefore, denial of refund on the first ground by Commissioner (Appeals) cannot be upheld.
(b) We find that the Commissioner (Appeals) on 30.5.97 has ignored the law on refunds under section 11B of the Central Excise Act 1944, as settled by the Constitution Bench of the Supreme Court on 19.12.1996 in the case of Mafatlal Industries Ltd (1997 (89) ELT/247 (SC) which would have been available to him. In para 90 of this decision, the Hon’ble Supreme Court has laid down—
“….But, this is perhaps for the reason Clause (e) of the proviso to Sub-Section (2) of Section 11 B does provide for the purchase of goods applying for and obtaining the refund when the can satisfy that the burden of duty has been borne by him alone. Such a person can apply within six months of his purchase…” This finding of law would be defeated, if one interprets that the notification benefit in the manner, as arrived at by the lower authority. The exemption has been granted on the grounds of hardships undergone by the people due to a ‘Major Calamity’ and require relief. Such noble intentions cannot be ignored in favour of procedural requirements; we find that the Hon’ble Supreme Court in the case of Swedesi Polytex 1989 (44) ELT 794 (SC) had held that in a fiscal exemption notification should not be given bye a circutous process of interpretation. After all exemption notifications are made to be implemented. In wood Polymer 1990 (47) ELT 500 (SC) and Novopan India Ltd (1994(73) ELT 76 (SC) has been held that once the benefit is eligible, then the notification has to be liberally constructed and not arrived at by the Commissioner. In H.M.M. ltd (1996 (87) 593 (SC) the Hon’ble Court laid down the law—
“14. By accepting the appellants contentions, the object underlying the enactment is in no way defeated nor is the objective underlying the notification…..”
We would, therefore, conforming to the objective of the notice, hold that refund is eligible to the appellants, and the gounds made to deny the same by Commissioner (Appeals) can only defeat the objectives and thus such an interpretation cannot be upheld and are required to be set aside. We have considered the Supreme Court Decision relied upon by the Commissioner (Appeals) i.e. Hansraj Gordhands (1978/ELTJ350). That was a case, wherein the Court held that if any tax payer if within the plain terms of an exemption, he cannot be denied its benefit by calling in aid any supposed intention (para 5 of the reported decision). In our view, the Cement utilised for earthquake relief is palinly exempt from duty and the reliance of the Commissioner (Appeals) on this decision of the Supreme Court does not help his order. In view of our findings, we cannot uphold the order of the lower authorities.
(c) Examining the rejection of the claim by the Commissioner (Appeals) on the ground that the “goods have not been sent directly from the factory but from the Depot” we find that the notification provides for the goods to be sent directly from the factory or warehouse. The notification permits the goods to be sent to be cleared from the factory without payment of duty if no charges are made for such supplies it also exempts goods purchased from Cash Donations (i.e. when costs for the goods are charged by a manufacturer) to be ‘duty exempted’; even if such supply is ‘ex-ware house’; which in the facts of this case, to our mind can not be restricted to a ‘warehouse’; as defined under Rule 2 (XV) to be only appointed place, registered only under rule 140. of the Central Excise Rules 1944; it would include a ‘Depot’ or wherever excise paid goods, are stored by a manufacturer after clearance. In this case, the goods have been suplied directly not from the factory of ACC Ltd Wadi but supplied ex-depot in Maharashtra directly to the recognised Relief Agency and used for earthquake relief. Therefore we find no merit in the second objection found by the Commissioner (Appeals) to deny the refund, when we find that refund as per the law could be claimed by ‘any person’ who has suffered the duty.
6. In view of our findings, the order of Commissioner (Appeals) is set aside and appeal allowed with consequential benefit.
(Pronounced and dictated in open court on 15\3\2001)