2008 (3) TMI 208 - AT - Central Excise

Notification No.13/2000 exempts the excisable goods specified in Chapter 72 & 73, manufactured in & cleared from an integrated steel plant and intended to be sold at a place other than the said integrated steel plant since both plants (plant mfg. sponge iron from iron ore & plant mfg. billets from sponge iron) are situated in common premises and have common registration under Factories Act, both plants will be treated as single factory under not. 13/2000 hence exemption can t be denied

Summary

Issues:
Interpretation of exemption Notification No.13/2000-CE for an integrated steel plant.

Analysis:
The case involved an appeal against the denial of the benefit of exemption Notification No.13/2000-CE to the appellant for the period from 2000-2001 to 2002-03. The Commissioner had confirmed a duty demand against the appellant under the proviso to Section 11A(1) of the Central Excise Act, along with interest and penalty under Section 11AC of the Act. The dispute centered around whether the appellant qualified as an integrated steel plant as defined in the notification. The appellant had two separate central excise registration certificates, one for sponge iron and the other for billets, both located within the same premises owned by the same company. The appellant later applied for and obtained a common registration certificate, thus being treated as an integrated steel plant from 1.6.04. The issue was whether the appellant should have been considered an integrated steel plant for the disputed period based on the common premises and ownership, despite the separate registration certificates.

The appellant argued that they met the definition of an integrated steel plant as per the notification, emphasizing the common premises, workforce, and captive consumption of sponge iron for billets production. They cited a Supreme Court judgment to support that different plants in the same premises could constitute one factory. The appellant also highlighted their treatment as an integrated steel plant for levy purposes before the notification came into effect. They contended that the change in Section 4 during the disputed period did not affect their eligibility for the exemption. Additionally, they argued that the demand was mostly time-barred as the relevant information was disclosed in their returns, precluding the invocation of an extended period of limitation.

The Department contended that the appellant could not be considered an integrated steel plant during the disputed period due to the separate registration certificates for sponge iron and billets, indicating distinct manufacturing processes. This argument was reiterated in the memorandum of cross-objection filed by the respondent.

The Tribunal analyzed the facts and legal precedents, noting that both the plants were situated in a common premises with shared resources, common ownership, and a single registration under the Factories Act. Relying on the Supreme Court's decision, the Tribunal concluded that the appellant's factory should be treated as an integrated steel plant, despite the separate registration certificates. The Tribunal also considered the appellant's past treatment as an integrated steel plant for levy purposes and found no justification for a different classification under the notification. Consequently, the Tribunal allowed the appeal, setting aside the Commissioner's order and rejecting the respondent's cross-objection.