Case Law Details
Nordex India Private Limited Vs Commissioner of Customs (Madras High Court)
Conclusion: Where the goods imported at concessional rate and meant for use in rotor of windmills were used in the manufacture of Wind Operated Electricity Generators at the site of the customer and imported parts invoiced to customer by importer and then installation taken up at site as a turnkey project had been awarded to importer for manufacture, erection and installation of the Wind Operated Electricity Generators, by raising an invoice in the name of his client after import and thereafter, transporting the same to the customer’s site was only an notional exercise, by that alone, it could not be said that assessee was not the importer and he was not entitled to the benefit of concessional rate under Notification No.12/2012 – Cus, dated 17.03.2012.
Held: Assessee was engaged in the manufacture, erection, installation and commissioning of Wind Operated Electricity Generators [WOEG], commonly known as Windmills. Assessee imported various materials and parts of Windmills through Tuticorin Port, for manufacture, erection and installation of the Wind Operated Electricity Generators in the specified site of the customers. While some of the parts were manufactured by assessee in the factory, certain other parts such as Rotor Blades, Tower and Transformer were imported and sent to the site directly where the Windmills were to be installed. Thereafter, the final product namely, Windmill would come into existence at the site. It was held that assessee-company used the Rotor Blades only in the manufacturing of Wind Operated Electricity Generators and further, Rotor Blades was not used for any other purpose. The only objection is that, clause (b) of Condition No.45 of Notification No.12/2012 – Cus, dated 17.03.2012, was not followed for the reason that assessee/importer, shall not use them for specific purpose. In this case, it had been used for the specific purpose in the Windmill. Assessee had been awarded Turnkey project and there were two contracts and one of the contracts was for erection, installation and commission. This needs expertise. Assessee having expertise applied with the Ministry of New and Renewable Energy, got approval, and then imported Rotor Blades and thereafter, transported the same, erected and commissioned the same at the customer’s site. The imported Rotor Blades, thus, need no customization and mechanization. Hence, by raising an invoice in the name of his client namely, S Private Limited after import and thereafter, transporting the same to the customer’s site was only an notional exercise, by that alone, it could not be said that assessee was not the importer and he was the person, who had used the same for a specific purpose, for which, it was imported. The payment to assessee was not on invoice to invoice basis, it was a turnkey project, wherein, the payments made at stages, which was no way correlated to the invoices raised. Therefore, the wording of the notification was to be interpreted in such a way as not to frustrate the purpose of the notification. The exemption could not be denied unless it was seen that it had been made to evade duty, it lead to evasion of duty which was not so in this case. The Rotor Blades had been fixed in the Windmill, which was an vital component for completion of the Windmill project. The specific purpose was the key word to be looked into, which was completed in the above case. The order was quashed.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This Writ Petition is filed seeking to quash the order dated 19.12.2018, passed by the respondent in C.No.VIII/10/78/2018-Adjn in Order in Original No.14/2018.
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