Scope of Explanation V of notification No. 175/86-C.E., dated 1-3-1986 with reference to State/Central Government undertakings - Clarification regarding - Central Excise - 345/1 /87-TRU

Scope of Explanation V of notification No. 175/86-C.E., dated 1-3-1986 with reference to State/Central Government undertakings - Clarification regarding F. No. 345/1 /87-TRU Dated 16-4-1987 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Scope of Explanation V of notification No. 175/86-C.E., dated 1-3-1986 with reference to State/Central Government undertakings - Clarification regarding. Doubts have been expressed by some collectors as to whether the clearances from different factories belonging to a State Government undertaking could be taken into account for the purpose of determining the eligibility for excise duty concession under Small Scale Exemption Scheme vide notification 175/86-C.E., dated 1-3-1986. 2. Explanation V of the aforesaid notification stipulates that where the specified goods are manufactured in a factory, belonging to or maintained by the Central Government or by a State Government, or by the KVIC, the value of excisable goods cleared from such factory alone shall be taken into account for the purposes of the notification. The question is whether factories belonging to a State/Central Government undertaking should be considered as factories belonging to or maintained by the State/Central Government for the purposes of Explanation V of the notification. 3. The matter has been examined in the Ministry. It is felt that the benefit of not clubbing the clearances from different factories belonging to or maintained by the Central Government / State government / KVIC for the purpose of excise duty concession under the notification, may not be extended to factories belonging to independent industrial corporations notwithstanding the fact that these corporations are the undertakings of State Governments/Central Government. It is, therefore, clarified that factories belonging to or maintained by an industrial corporation of a State Government/Central Government will not come within the purview of Explanation V of notification No. 175/86-C.E., dated 1-3-1986.