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TMI Blog2015 (1) TMI 539X X X X Extracts X X X X X X X X Extracts X X X X ..... e exemption/benefits contained in the Notification No. 39/2001, on production/manufacturing of cast iron articles is concerned, it is not clear as to whether on production/manufacture of cast iron articles on the unit/plant and machineries fully installed and commissioned prior to 31-12-2005, the petitioners have been denied the said benefits or not - if, the unit/plant and machineries have been commissioned/installed (Fully) prior to 31-12-2005, the petitioner may be entitled to the benefits contained in the aforesaid Notification, on manufacture/production of cast iron articles for a period of five years from the date of commencement of the first commercial production of such goods on such unit. Under the circumstances, the concerned respondent are required to consider the case of the petitioner for grant of the benefit under the Notification No. 39/2001 with respect to the production/manufacture of cast iron articles. So far as challenge to the clarificatory Circular, dated 25-4-2006, issued by the Director (TRU), clarifying that, if, the commercial production of a particular kind of specified goods has not commenced prior to 31-12-2005, there again the benefit of such notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) to issue Certificate to the Company in terms of Condition 3(ii) of the said Notification; (iii) to allow the Company to avail the benefit of the said Notification (Annexure-A hereto) in respect of all clearances of excisable goods from the new unit set up by the Company in Kutchh at the address mentioned hereinabove by availing the exemption in terms of the said Notification until 30th December, 2010 or such other period as may be extended by the Central Government from time to time; and (iv) to forthwith refund to the Company a sum of ₹ 8.20 crore being the amount paid by the Company over and above the CENVAT Credit utilized by the Company in terms of the said Notification (Annexure-A hereto) together with interest thereon @ 12% per annum from the due date of the refund in terms of the said Notification until payment thereof to the company. 2. The facts leading to the present Special Civil Application and so stated in the petition by the petitioners are as under. 3. It is the case on behalf of the petitioners that in light of the Notification No. 39/2001-C.E., dated 31-7-2001, granting exemption to excisable goods cleared from its unit in Kutc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts contained in the Notification No. 39/2001-C.E., for a period of five years from the date of first commercial production. It is submitted that, therefore, denial of the exemption/benefits contained in the Notification No. 39/2001-C.E., by the respondent is absolutely illegal, arbitrary and contrary to the aforesaid Notification. It is submitted that even with respect to the manufacturing of cast iron articles, the petitioners have been denied the exemption/benefits under the Notification No. 39/2001-C.E., though, with respect to the said products, plants and machineries were installed and the Unit was commissioned (Fully) prior to 31-12-2005 and even the first commercial production was also prior to 31-12-2005. It is, further, submitted that even the clarification circular, dated 25-4-2006, issued by the Director (TRU), Ministry of Finance, clarifying that when the commercial production of a particular kind of a specified goods has not commenced before 31-12-2005, then, the exemption/benefit of the Notification No. 39/2001-C.E., would not be available to such goods, is contrary to the object and purpose of the original scheme, and therefore, same is ultra vires to the Notificatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted that in the present case, as such, the unit/plant and the machineries for the production of Pig Iron was not commissioned and or installed (Fully) prior to 31-12-2005. It is submitted that the aforesaid clarification shall be applicable only in a case, where, the Unit has been commissioned and the plant and machineries have been installed prior to 31-12-2005 and that for whatever reasons, there was no commercial production prior to 31-12-2005. It is submitted that therefore the challenge to the aforesaid clarification would be academic so far as the present petition is concerned. It is, further, submitted that even otherwise, it is a Circular issued in the nature of clarification and what is required to be considered is whether the petitioners would be entitled to the exemption/benefit under Notification No. 39/2001 or not? It is, therefore, submitted that on the facts stated herein above, the petitioners shall not be entitled to the exemption/benefits under Notification No. 39/2001. However, when the attention of Shri Parikh, learned Advocate appearing on behalf of respondent No. 2, was drawn to the fact that with respect to the cast iron articles, the unit/plant and machiner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reliance placed upon the Circular No. 110/21/2006-CX.3, dated 10-7-2008 by the petitioners is concerned, it is absolutely misplaced. Under the aforesaid clarificatory circular, it is mentioned that in case a unit introduces the new product manufactured from raw material by installing fresh plant and machinery after the cut-off date i.e. 31-12-2005, in such a situation, exemption would not be available to the said new product and the said new product would be cleared on payment of duty as applicable and separate records will be required to be maintained to distinguish production of these products from the products which are eligible for exemption. It also further clarifies that where a unit starts producing some products (after the cut-off date) using the plant and machinery installed up to cut-off date and without any addition to the plant and machinery, in that case, the unit would be eligible for the benefit of exemption notification because the plant and machinery used for manufacturing has remained the same. In the present case, admittedly, there is no new product by installing fresh plant, machinery or capital goods after the cut-off date i.e. 31-12-2005. The same product is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion would not be available to the such goods, is concerned, so far as the claim of the petitioner with respect to the Pig Iron is concerned, as stated and observed herein above, said situation may not arise, as industrial Unit was not commissioned and the plant and machineries were not installed (Fully) prior to 31-12-2005. So far as the grant of benefits with respect to the same Scheme contained in the Notification No. 39/2001 on manufacturing/production of cast iron is concerned, as stated above, the matter is required to be considered by the appropriate authority in light of the observations made herein above as well as the observations made by the Division Bench of this Court in the case M/s. Plastene India Ltd. (supra). 13. In view of the above and for the reasons stated herein above, present Special Civil Application is dismissed so far as the claim of the petitioner for grant of exemption/benefit of the Notification No. 39/2001, dated 31-7-2001, with respect to the production of Pig Iron is concerned. However, so far as the claim of the petitioner for grant of exemption/benefit of the Notification No. 39/2001 with respect to the production of cast iron articles is conce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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