CESTAT Mumbai has allowed benefit of Notification No. 10/97-C.E. to air-conditioning and refrigeration equipment supplied to Research & Development Organisations namely, Vehicle Research & Development Establishment, and the Electronic & Radar Development Establishment, when the AC system were specially designed and modified, by the said customers, for use in specialized mobile operation theatres for use by the Indian Army in the field.
The Tribunal on 8-3-2016 in the case of Auto Aircon (India) Ltd. v. Commissioner has noted that the customers were public sector institutions who had fulfilled all the conditions of the notification and therefore, exemption was held as admissible.
Similarly, CESTAT Bangalore in its recent decision dated 18-2-2016, rejected the contention of the department that if goods supplied are in common and commercial parlance known as parts of aircraft or parts of some other equipment, and have been supplied in commercial quantity, they cannot be used for research purposes.
Argument of the lower authorities that research purposes goods should be supplied only in smaller quantities was rejected by the Tribunal in the case of Spectrum Infotech Pvt Ltd. noting that conditions of the notification were satisfied by the assessee.