2013 (3) TMI 453 - AT - Central Excise

Exemption under notification No. 56/2002-C.E denied - as per department while the industrial area in which the unit is located is specified in the Notification, the Khasra No. 126/68/37-min, in which the unit is located is not specified against Industrial Estate SICOP, but is specified against Industrial Estate SIDCO, Kathua - Held that - Since this unit is located in industrial Estate SICOP which is specified in the Annexure-II to the notification against Sl. No. (2)(II)(C) (1), just because the Khasra No. in which the unit is located - No. 126/68/37-min is not specified against SICOP industrial Estate but is specified under SIDCO industrial Estate, the benefit of exemption cannot be denied, as the benefit of the notification is available in respect of the eligible goods manufactured and cleared by the units located in the industrial Estates/industrial area as specified in Annexure-II to the notification and this condition stands satisfied by the assessee. There may be mistake in mentioning the Khasra numbers covered by a particular industrial area and, therefore, just because the Khasra number of a unit is not mentioned against a particular industrial area, the benefit of the exemption cannot be denied to a unit when the unit, without any doubt, is located in the specified industrial area - in favour of assessee.

Summary

Issues:
Interpretation of exemption notification under Notification No. 56/2002-C.E. for refund of duty paid by a manufacturer located in Jammu & Kashmir.

Analysis:
The case involved a manufacturer located in Jammu & Kashmir seeking a refund of duty paid under Notification No. 56/2002-C.E. The manufacturer claimed exemption under the notification for goods manufactured and cleared from their unit located in an industrial area specified in Annexure-II. The dispute arose when the Commissioner reviewed the Assistant Commissioner's refund orders, arguing that the unit did not meet all conditions of the notification simultaneously. The main contention was whether the Khasra number of the unit's plot, as specified in the industrial area, aligned with the requirements of the exemption notification.

The Commissioner (Appeals) initially dismissed the review appeal, ruling in favor of the manufacturer's eligibility for the exemption. The Revenue filed appeals against this decision, challenging the interpretation of the exemption notification. The Departmental Representative argued that strict construction of the notification was necessary, citing a Supreme Court judgment emphasizing adherence to the notification's wording. The crux of the Revenue's argument was that since the Khasra number of the unit did not match the industrial area specified in Annexure-II, the exemption should not apply.

On the other hand, the manufacturer's Counsel defended the Commissioner (Appeals) decision, highlighting that the unit met the criteria of being located in the specified industrial area, despite the discrepancy in the Khasra number mentioned in the notification. The Counsel contended that the exemption should not be denied based solely on the mismatch of Khasra numbers.

After considering both parties' arguments and examining the records, the Tribunal found that the unit was situated in the specified industrial area, even though the Khasra number did not precisely match the notification. The Tribunal reasoned that the benefit of the exemption should not be denied when a unit is undeniably located in the designated industrial area, even if there are discrepancies in the Khasra numbers mentioned. Therefore, the Tribunal upheld the Commissioner (Appeals) decision, concluding that the manufacturer was eligible for the exemption under Notification No. 56/2002-C.E.

In the final judgment, the Tribunal dismissed the Revenue's appeals, stating that there was no merit in their arguments. The stay applications were also dismissed, and the order was pronounced in open court on a specific date.