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TMI Blog2016 (5) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... ing works with the proposed Haridwar Plant-II by putting a wall in between the two. The existing works shall be named as Lakhani Footwear Pvt. Ltd and the expanded capacity where they would put the additional plant and machinery and construct the building, shall be named as Lakhani Footwear Pvt. Ltd (Haridwar Plant-II) for their accounting, project monitoring and management information purposes; that they would maintain a separate series of invoices to be issued each prefixed with the letters "SE" - to indicate that the invoices pertain to clearances from the expanded capacity, though the excise return & service tax return for the unit shall be filed in consolidated manner as substantial expansion is taking place in the same plot. 2. Applicant submits that Central Board of Excise & Customs (CBEC) has clarified by its Circular No. 939/29/2010-CX dated 22.12.2010 that units which are already enjoying the duty exemption can produce new articles after the cutoff date using the same plant and machinery or by installing a new plant and machinery or capital goods and the provisions of Notification No. 50/2003-CE do not place a bar or restriction on an addition / modification in the plant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter sun set clause i.e. after 31.3.2010, the said unit will not be eligible to enjoy the benefit of the said exemption notification and shall have to pay duty at the applicable rates. 6. It is observed that the Revenue has raised two objections. First objection is that the proposed Unit II does not fall under the category of existing unit, which has undergone substantial expansion in terms of Notification No. 50/2003-CE. Second issue raised is connected to the first issue, i.e., the proposed Unit-II will come into existence after the sunset clause i.e. after 31.03.2010, therefore said unit will not be eligible to enjoy the benefit of exemption Notification No. 50/2003-CE. 7. It is observed that the applicant submitted Intimation / Declaration dated 29.03.2010 to the Central Excise authority for setting up a new manufacturing unit in the State of Uttarakhand (earlier Uttaranchal) and availing benefit of exemption under Notification No. 50/2003-CE. The declaration shows location of unit as Khasra No. 72 and 74, Plot No. 11, Sec-11, 11E, Haridwar. Date of trial production is shown as 21.03.2010 and date of exercising option under Notification No. 50/2003-CE and date of commercial pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction only on 21.03.2010. It is to be seen if Condition 2(a) above is satisfied by the applicant, which consists of; a) Whether new industrial unit is set up in areas mentioned in Annexure II and Annexure III appended to the Notification No. 50/2003-CE It is observed that the unit is located in the area mentioned in Annexure-II to the said Notification. Therefore, this sub-condition is satisfied. b) Whether the unit has commenced commercial production on or after 07.01.2003 but not later than 31.03.2010. It is noticed from the Intimation/ Declaration dated 29.03.2010 under Notification No. 50/2003-CE, submitted by the applicant that they commenced commercial production on 26.03.2010. Since it was a new unit, it could not have started production before 07.01.2003. Therefore, this sub-condition is also met by the applicant. 12. Applicant has relied on Circular No. 939/29/2010-CX dated 22.12.2010 issued by CBEC regarding scope of Notification No. 50/2003-CE. Relevant portion of the Circular is reproduced as under: Representations have been received from Trade and Industry Associations seeking clarification on the availability of the exemption benefit under these notifications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing unit, is not correct. Relevant Notification No. 50/2003-CE, as also CBEC Circular dated 22.12.2010 and 17.02.2012, do not envisage such condition. In view of said clarifications issued by CBEC, applicant can continue to avail the benefit of excise exemption. 14. As far as second issue raised by Revenue regarding applicant starting a new unit i.e. Haridwar Plant II and not falling under the existing unit, is concerned, applicant has relied on Circular No. 960/03/2012-Cx dated 17.02.2012. Relevant extract of said Circular are reproduced, as under:- References have been received from field formations as well as from trade and industry seeking clarification regarding admissibility of benefit under area-based exemption Notifications No. 49/2003-CE and 50/2003-CE, both dated 10.06.2003, in the following situations: a. When there is a change in the ownership of a Unit already availing of the benefit of an area-based exemption Notification. b. When a Unit availing of the exemption physically shifts to a new location within the areas specified in the exemption Notification; and c. When a Unit availing of the exemption under an area-based Notification expands by acquiring a plot ..... X X X X Extracts X X X X X X X X Extracts X X X X
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