Commissioner of Customs Vs M/s Mahavir Roads & Infrastructure Pvt. Ltd. (CESTAT Mumbai)
Prior to budget 2012, benefit of customs duty exemption on road construction equipment was not available in cases where the contract for such construction was awarded by a Metropolitan Development Authority. Thus the appellant in the present case is not eligible for the benefit of duty exemption under Notification No. 21/2002-Cus. Accordingly, we dismiss the appeal as devoid of merits.
FULL TEXT OF THE CESTAT ORDER IS AS FOLLOWS:-
This appeal has been filed by Revenue against allowing exemption to goods imported under Notification No. 21/2002-Cus. Sr. No. 230.
2. Learned AR argued that Commissioner (Appeals) has wrongly interpreted Notification No. 21/2002-Cus by construing that “Mumbai Metropolitan Regional Development Authority” (MMRDA) is a road construction corporation under the control of the State Government. It was argued that the MMRDA is a corporate body, incorporated under the MMRDA Act, 1974. He pointed out that condition No. 40 (ii) of Notification No. 21/2002-Cus Sr. No. 230 grant exemption reads as under:
“A person who has been awarded a contract for the construction of roads in India by or on behalf of the Ministry of Surface transport, By National Highway Authority of India, by the Public Works Department of State Government or by a road construction corporation under the control of the government of a State Or Union Territory etc.”
It was argued that the eligible Department have been specifically named in the notification, covering only those which are part of and/or under the control of Central/State Government and Union Territories are eligible for the exemption. He argued that the notification has to be strictly read and interpreted. Learned AR relied on the decision of Tribunal in the case of Shreeji Construction Vs. Commissioner of Customs (Import), Mumbai – 2014 (313) ELT 566 (Tri.-Mumbai).
3. Learned Counsel for the respondent argued that MMRDA is established under the Mumbai Metropolitan Regional Development Authority Act, 1974 and therefore a road construction corporation under the control of the State Government. He relied on the impugned order. Learned Counsel also relied on the decision of Tribunal in the case of Patel Engineering Ltd. Vs. Commissioner of Customs (Import), Mumbai – 2013 (295) ELT 243 (Tri.-Mumbai) which was confirmed by Hon’ble Apex Court reported at 2016 (338) ELT A35(SC).
4. We have considered the rival submissions, we find that in the case of Rajhoo Barot Vs. Commissioner of Customs (Mumbai) – 2017 (348) ELT 562 (Tri.-Mumbai), the Larger Bench of the Tribunal considered the case of Shreeji Construction (supra) and Patel Engineering Ltd. (supra) and held that the decision of Tribunal in the case of Shreeji Construction (supra) is directly dealing with the dispute in the present proceeding, whereas the only ancillary issue is dealt with in the case of Patel Engineering Ltd. (supra). We find that the issue is decided by the Tribunal in the case of Shreeji Construction (supra) whereas the following has been observed:-
“5.2 A reading of the above two notifications makes it clear that prior to budget 2012 the notification specified only the following authorities, namely. National Highway Authority of India, Public Works Department of a State Government or a road construction corporation under the control of the State Government or Union Territory. However, after budget 2012, the authorities specified are: National Highway Authority of India, Public Works Department of a State Government, Metropolitan Development Authority or a road construction corporation under the control of State Government or Union Territory. From this it is clear that the Notification differentiates between a Metropolitan Development Authority and a Road construction corporation. Otherwise there was no need to specify both these agencies as the persons who can award the contract for the purpose of the Notification. If the intention was to consider Metropolitan Development Authority as a Road construction corporation, the language used would have been different – for e.g. a road construction corporation including a Metropolitan Development Authority or by way of an explanation. That has not been done in the instant case. Therefore, we are of the view that the notification considers a Metropolitan Development Authority and a Road development construction as distinct and different entities.
5.3 This view is further strengthened for the reason that in the State of Maharashtra there is a separate corporation, namely, the Maharashtra State Road Development Corporation. There are such corporations in other States also, for e.g. in Gujarat, Rajasthan and so on. If one carefully examines the creation of the road development corporations and their objectives, it can be seen that both legally and functionally, road development corporations and a metropolitan regional development authority are distinct entities. The major differences are summarized in the table below.
