9911796707
TMI Blog2009 (8) TMI 1024X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 21-6-2004 passed by Deputy Commissioner, Dehradun whereby the SSI exemption claimed by the appellants was sought to be rejected and the demand of duty to the tune of Rs. 4,40,000/- was confirmed and recovery thereof was ordered under Section 11A of the Central Excise Act, 1944 along with interest thereon and further penalty of the amount equal to the duty was also imposed under Rule 25(1)(d) of the Central Excise Rule, 2002 as well as the penalty of Rs. 5,000/- under Rule 27, and further penalty of Rs. 10,000/- on the Managing Director was also imposed. The benefit of SSI exemption was sought to be denied to the appellants on the ground that the appellants had failed to establish that their unit was situated within the rural area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Managing Director of Zila Udyog Kendra, Dehradun as well as by the Tehsildar of Dehradun. The first certificate would disclose that the area in question comprises of rural area and second certificate would disclose the survey number of the concerned land situated in the rural area. According to the learned Advocate, the certificates refer to the factual aspect of the matter and, therefore, the appellants should be allowed to rely upon those certificates even at this stage. He further submitted that in case the Tribunal has difficulty in allowing the appellants to rely upon the additional evidence then while setting aside the impugned order the matter should be remanded to the original authority permitting the appellants to produce f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 8/2002-C.E., dated 1-3-2002, whereunder the SSI exemption for units not availing Cenvat credit was sought to be granted subject to condition that the specified goods were manufactured in a factory located in the rural area . The explanation to the said notification under Clause 5(H) defines the term rural area means the area comprised in a village as defined in the land revenue records, excluding- (i) the area under any municipal committee, municipal corporation, town area committee, cantonment board or notified area committee, or (ii) any area that may be notified as an urban area by the Central Government or a State Government. 6. Being so, if one reads the notification and the meaning attached thereunder to the expre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and rejected the same for valid reason. The certificate nowhere discloses to have been issued by an authority who is competent to certify as to whether the particular area forms part of any village or not. The law clearly requires that the area should be shown as the rural area as defined in the land revenue records. In other words, the revenue authorities should have to verify and certify as to whether the particular area lies within a particular village or not. Considering the same merely because Zila Panchayat officer or authority certifies that particular area is situated within a village, it would not lead to a conclusion that the concern area is a rural area within the meaning of the said expression under the said notification. 9. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 11. As already observed above, once it was not the case of the Department while issuing show cause notice that the area in question was not rural area and merely on the basis of the reply filed by the appellants claiming that the area is rural area, the authority without calling the appellants to produce the evidence in that regard, having proceeded to deny the benefit under said notification, undoubtedly the action on the part of the authority cannot be said to be in keeping with the requirements of law or by observing the rules of natural justice. As rightly submitted by learned Advocate for the appellants in the facts and circumstances of the case, it will be appropriate to set aside the impugned order and to remand the matter to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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