In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of section 3 of Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts goods, namely. –

(i) in the case of hotel or stand alone restaurant, capital goods including spares, office equipment, professional equipment, office furniture and consumables, related to its service sector business and food items and alcoholic beverages but excluding other products classifiable in Chapters 1 to 24 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and items not permitted to be imported in terms of Appendix 37B of the Hand Book of Procedure, volume I;

(ii) in the case of service provider other than hotel or stand alone restaurant, capital goods including spares, office equipment, professional equipment, office furniture and consumables, related to its service sector business, but excluding the items not permitted to be imported in terms of Appendix 37B of the Hand Book of Procedure, volume I;

(iii) in the case of service provider who is also engaged in manufacturing activity, capital goods including spares related to its manufacturing sector business, but excluding the items not permitted to be imported in terms of Appendix 37B of the Hand Book of Procedure, volume I;

(Above sub-paragraphs (i) and (ii) substituted vide  NTF. NO. 15/2013-CE, DT. 18/04/2013)

[OLD -  (i) in the case of hotel or stand alone restaurant capital goods including spares, office equipment, professional equipment, office furniture and consumables, related to its service sector business and food items and alcoholic beverages but excluding other products classifiable in Chapters 1 to 24 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975);

(In clause (i) the words "capital goods including spares" has been inserted vide NTF. NO. 41/2006-CE, DT. 13/10/2006)

(ii) in the case of service provider other than hotel or stand alone restaurant, capital goods including spares, office equipment, professional equipment, office furniture and consumables, related to its service sector business,

when cleared against a Served from India Scheme Certificate, (hereinafter referred to as the said Certificate) issued under paragraph 3.6.4 or paragraph 3.12 [OLD- paragraph 3.6.4 ] of the Foreign Trade Policy, from

(In opening paragraph the words & figures "paragraph 3.6.4 or paragraph 3.12" -substituted vide NTF. NO. 17/2013-CE, DT. 16/05/2013)

(1) the whole of the duty of excise leviable thereon under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);

(2) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1958); and

(3) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978) ]

subject to the following conditions, namely :-

(i) that the said certificate has been issued to a service provider by the Regional Authority and it is produced before the jurisdictional Central Excise Officer at the time of clearance for debit of the duties leviable on the goods, but for this exemption :

Provided that exemption from duty shall not be admissible if there is insufficient credit in the said certificate for debiting the duties leviable on the goods, but for this exemption;

(ia) that in the case of capital goods including spares covered at sub-paragraph (iii) above, the manufacturing sector business of the service provider has been endorsed by the Regional Authority on the said scrip during the period of validity of the said scrip and upon such endorsement, the validity of the said scrip remains unchanged.;

(Above condition (ia) has been inserted vide  NTF. NO. 15/2013-CE, DT. 18/04/2013)

(ii) that the said certificate and goods cleared against it shall not be transferred or sold;

Provided that except in case of goods covered at sub-paragraph (iii) above, transfer of the said certificate and goods may be allowed subject to actual user condition within the service providers of the group company or managed hotels as defined in Chapter 9 of the Foreign Trade Policy;

(Above proviso has been substituted vide NTF. NO. 17/2013-CE, DT. 16/05/2013)

[OLD- Provided that, except in case of goods covered at sub-paragraph (iii) above, transfer [OLD- that transfer ] of the said certificate and goods may be allowed subject to actual user condition within the service providers of the group company or managed hotels as defined in paragraph 9.28 and paragraph 9.36 respectively of the Foreign Trade Policy, as the case may be. ]

(iia) that the capital goods including spares covered at sub-paragraph (iii) above shall be subject to actual user condition and the person procuring the goods, at the time of clearance of the said goods, shall furnish an undertaking to this effect to the Deputy Commissioner of Central Excise or Assistant Commissioner of Central Excise, as the case may be, that in case of non compliance of the said condition, he shall pay on demand an amount equal to the duty leviable, but for the exemption contained herein together with interest at the rate of fifteen percent per annum from the date of clearance of the said materials.;

(In above condition (ii), in the proviso the words "that, except in case of goods covered at sub-paragraph (iii) above, transfer" - substituted & Condition (iia) - inserted vide  NTF. NO. 15/2013-CE, DT. 18/04/2013)

(iii) that in respect of capital goods, office equipment and professional equipment a certificate from the jurisdictional Deputy Commissioner of Central Excise or Assistant Commissioner of Central Excise or an independent Chartered Engineer, as the case may be, is produced confirming installation and use of the goods in the factory or premises of the holder of the said certificate, within six months from the date of clearance or within such extended period as the Deputy Commissioner of Central Excise or Assistant Commissioner of Central Excise, as the case may be, may allow ;

2. Exemption under this notification shall not be available for clearance of vehicles even if such vehicles are freely importable under the Foreign Trade Policy. However, the vehicles which are in the nature of professional equipment (and are not personal vehicles) for use by the service provider in his regular service business shall be permitted. For this purpose, motor cars, sports utility vehicles and all purpose vehicles for the service provider hotels, travel agents, tour operators or tour transport operators and companies owning/operating golf resorts shall not be regarded as personal vehicles subject to the condition that the jurisdictional central excise authority endorses the invoice at the time of clearance specifying that the vehicle shall be registered as vehicle for “tourist purpose only” and the vehicle is so registered and a copy of the registration certificate to that effect is submitted to the concerned jurisdictional central excise authority as a confirmation of clearance of vehicle within six months from the date of clearance and the said vehicle is used for tourist purpose only.

(Above paragraph 2. has been inserted vide  NTF. NO. 15/2013-CE, DT. 18/04/2013)

Explanation - For the purposes of this notification, -

(i) "Capital Goods" has the same meaning assigned to it in paragraph 9.12 of the Foreign Trade Policy;

(ii) "Foreign Trade Policy" means the Foreign Trade Policy 2004-09, published as the notification of the Government of India in the Ministry of Commerce and Industry, vide No.1/2004, dated the 31st August, 2004, or the Foreign Trade Policy 2009-14, published as the notification of the Government of India in the Ministry of Commerce and Industry, vide No.1/2009-2014, dated the 27th August, 2009, as amended from time to time, as the case may be;  [OLD- as amended from time to time; ]

(In above item (ii) tje words "or the Foreign Trade Policy 2009-14, published as the notification of the Government of India in the Ministry of Commerce and Industry, vide No.1/2009-2014, dated the 27th August, 2009, as amended from time to time, as the case may be;" has been substituted vide NTF. NO. 17/2013-CE, DT. 16/05/2013)

(iii) "Regional Authority" means the Director General of Foreign Trade appointed under section 6 of the Foreign Trade (Development and Regulation) Act, 1992 (22 of 1992) or an officer authorized by him to grant a certificate under the said Act.

F.NO.605/168/2005-DBK