2010 (5) TMI 428 - AT - Central Excise

Refund claim - adjudicating authority rejected the said claim on the ground - commencement of production was prior to the exemption notification would not be admissible - Held that - certificate had been issued by the said authority showing that the appellant had started commercial production only from 15-6-2002 - commencement of production the Department of Industry of the State Government may be consulted who should be in a position to advice on that aspect - Appeal is dismissed

Summary

Issues:
1. Benefit of area-based exemption under Notification No. 56/2002-C.E.
2. Date of commencement of production for claiming exemption.
3. Rejection of refund claim by the adjudicating authority.
4. Interpretation of relevant legal provisions and circulars.
5. Admissibility of production based on monthly returns.
6. Evidentiary value of certificates and declarations.
7. Dispute resolution regarding the date of commencement of production.

Analysis:
1. The appeals involved the eligibility of the respondents for the benefit of area-based exemption under Notification No. 56/2002-C.E., dated 14-11-2002. The Commissioner (Appeals) allowed the appeals, holding that the respondents were eligible for the exemption as their factory's production commenced from 26th August, 2006, meeting the notification's criteria.

2. The core issue revolved around the date of commencement of production for claiming the exemption. The adjudicating authority rejected the refund claim based on a certificate stating production started on 20-12-2006. However, the Commissioner (Appeals) relied on returns filed by the respondents for September, October, and November 2006, indicating production from September 2006. The department disputed this, citing the need for a certificate from the Department of Industries.

3. The rejection of the refund claim by the adjudicating authority was based on discrepancies in the date of commencement of production. The respondents' claim was supported by their monthly returns showing production figures, which the Commissioner (Appeals) deemed sufficient for granting the refund.

4. The interpretation of relevant legal provisions and circulars played a crucial role in the judgment. The department argued that a certificate from the Department of Industries was necessary to determine the commencement date, while the respondents contended that such a requirement was not specified in the notification.

5. The admissibility of production based on monthly returns became a point of contention. The respondents' advocate argued that the returns clearly demonstrated actual production, countering the department's claim that the production might have been on a trial basis.

6. The evidentiary value of certificates and declarations was debated, with the department questioning the validity of the certificate indicating the commencement date. The Tribunal emphasized the importance of filed declarations and accepted monthly reports as evidence of actual production.

7. The judgment highlighted the importance of resolving disputes regarding the date of commencement of production. The Tribunal emphasized the significance of factual evidence, such as filed declarations and monthly production reports, in determining the actual start of production, ultimately dismissing the appeals due to lack of grounds for interference.