Per P.K.Das


As the common issue involved in these appeals, therefore, all are being taken up together for disposal.


2. The relevant facts of the case in brief are that the assessee is engaged in the manufacture of Uninterrupted Power Supply System (UPSS) classifiable under Chapter 85 of the Schedule to the Central Excise Tariff Act, 1985. The assessee cleared the UPSS to various research institutes and availed full exemption under Notification No.10/97-CE dt. 1.3.97. In appeal No.E/570/03, original authority confirmed the demand of duty of Rs.1,69,253/- denying the benefit of exemption notification and imposed penalty of Rs.25,000/-. Commissioner (Appeals) modified the adjudication order to the extent of benefit of cum duty price was allowed. Hence the assessee has filed this appeal. In Appeal No.E/569/03, the original authority confirmed the demand of duty of Rs.53,216/- denying the benefit of the exemption notification and imposed penalty of Rs.5000/-. Commissioner (Appeals) modified the adjudication order insofar as the benefit of cum duty price was extended. The assessee filed appeal against the order of the Commissioner (Appeals) on merit. Revenue filed appeal No.E/566/03 against the said order on the ground that the Commissioner (Appeals) has no power of remanding the matter to the original authority under Section 35A (3) of the Central Excise Act, 1944.


3. Heard both sides and perused the records. The issue involved is as to whether the UPSS cleared by the assessee to the research units is eligible for the benefit of Exemption Notification No.10/97-CE dt. 1.3.97. For the purpose of proper appreciation, the relevant portion of the said notification is reproduced below :-


?Exemption to specified goods supplied to specified institutions



In exercise of the powers conferred by sub-section (1) of Section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in column (3) of the Table below and falling under the Schedule of the Central Excise Tariff Act, 1985 (5 of 1986), from the whole of the duty of excise leviable thereon which is specified in the said schedule, when supplied to the institutions specified in the corresponding entry in column (2) of the said Table, subject to the conditions specified in the corresponding entry in column (4) of the said Table.



TABLE

S.No.

Name of the Institutions

Description of the goods

Conditions

(1)

(2)

(3)

(4)

1.

Public funded research institution or a university or an Indian Institute of Science, Bangalore or a Regional Engineering College other than a hospital


(a) Scientific and technical instruments apparatus, equipment (including computers)


(b) Accessories and spare parts of goods specified in (a) above and consumables;


(c) Computers software, Compact Disc-Read only Memory (CD-ROM), record magnetic tapes, microfilms, microfiches


(d) Prototypes?


4. The ld. Advocate Shri Bharathi, on behalf of the assessee, submits that the UPSS is accessories of computers. Alternatively, it is equipment. He placed literature of the UPS System wherein it is stated that numeric UPS systems protect sensitive equipment from perils such as spikes, surges, voltage fluctuations, black outs and other aberrations. He submits that there is no dispute that the UPSS were cleared to the research institutes as evident from the certificates. He also submits that in Customs Notification No.76/2004-Cus. dt. 26.7.04, UPSS has been treated as accessories of computer. He relied upon the decision of the Tribunal in the case of Godrej Appliances Ltd. Vs CCE Vapi [2009 (236) ELT 729 (Tri.-Ahmd.)]. The ld. SDR Shri Dhanasekaran submits that UPS System is not specially designed or tailor-made to be used only with a computer. It cannot be treated as accessory of computer. He also submits that the goods is not to be considered as a scientific and technical instrument or equipment. He relied upon the decision of the Tribunal in the case of Sudhir Engineering Co. Vs CCE Surat [2004 (164) ELT 211 (Tri.-Del.)].


5. On perusal of the Notification No.10/97-CE, we find that the exemption was extended to scientific and technical instruments, apparatus, equipment (including computers) and accessories and spares parts of aforesaid goods. There is no dispute that the goods were cleared to research institutes. It appears

from the literature placed by the ld. advocate that the UPSS is equipment to protect perils such as spikes, surges, voltage fluctuations, black outs and other aberrations. UPSS is, therefore, in our view, covered under clause (a) of Sl.No.1 of the Table appended to the said notification. Hence there is no reason to deny the benefit of the exemption notification. 6. In view of the above discussions, the appeal No.E/566/03 filed by the Revenue is dismissed. Appeals filed by the assessee are allowed.