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TMI Blog2020 (3) TMI 840X X X X Extracts X X X X X X X X Extracts X X X X ..... xemption scheme (notification read with clarifications). There is a virtual corridor / private road existing between the three sheds, admittedly located in one industrial complex and hence for all practical purposes, the three units can be said to be adjacent to each other. Further, it is admitted fact that the two units namely M/s Fantasy and M/s Jyoti Lab have their entry exit gate from the South East common passage, whereas the three units of the appellant are using the common passage on the North West side. Thus, there is no practical interference in movement between the three units of the appellant and virtual corridor exits. In this view of the matter also, Unit-II and Unit-III of the appellant are held to be eligible for area based exemption. Thus, the appellant is entitled for area based exemption with respect to their unit-II located at Khasra No. 115 and unit-III located at Plot B/119 - appeal allowed - decided in favor of appellant. - Excise Appeal No. 50747 of 2019, 50748 of 2019 - Final Order Nos. 50619 – 50620/2020 - Dated:- 13-3-2020 - HON BLE MR. ANIL CHOUDHARY, MEMBER (JUDICIAL) AND HON BLE MR. C. L. MAHAR, MEMBER (TECHNICAL) Shri Kapil Vaish, C. A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the public road. Initially, the appellant had their manufacturing unit at Plot No. C (Khasra No. 119), which was later on, shifted to Plot No. F, Khasra No. 119. There is no dispute about the exemption available to the manufacturing activity undertaken in the said unit at Plot F /plot C . 6. After 31.03.2010 (end of the period for claiming eligibility, to avail exemption), Circulars dated 22.12.2010, 17.02.2012 and 01.04.2013 have been issued by Board clarifying that the exempted units could also manufacture by installing new plant and machinery, there may be change in ownership of the eligible unit, the eligible unit may expand by acquiring an adjoining plot and installing new plant and machinery. It was further clarified that the expansion should be done by acquiring the adjoining Plot with atleast one common wall/ boundary to make it one unit. 7. The appellant expanded its commercial production by way of installing additional plant and machinery in the shed at Khasra No. 115 and being eligible in view of circulars dated 17.02.2012 read with 01.04.2013, exemption was claimed for the expanded capacity also. Further, Plot B of Khasra No. 119 was used for storage of r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 119 and therefore, units at Plot B of Khasra No. 119 and at Khasra No. 115 cannot be treated as expansion of unit at Plot No. F of Khasra No. 119, for the purpose of area based exemption from payment of excise duty in terms of CBEC Circular No. 960/03/2012-CX.3 dated 17.02.2012. The CBEC had clarified that the situation of expansion of an eligible unit by acquiring an adjacent plot of land and installing new plant and machinery on such land, is akin to expansion by way of installing new plant and machinery inside the existing plot/ premises. Further, vide Circular No. 968/2/2013-CX dated 01.04.2013, CBEC clarified that para 5 of the aforesaid Circular dated 17.02.2012 is meant for a situation where the expansion is done by acquiring the adjoining plot with at least one common boundary, which merges with the existing plot/ premises to make it one unit; installing of new plant and machinery in a plot which is away from the existing plot is not akin to the situation mentioned in para 5 of the said circular and installation of plant and machinery on such a plot would tantamount to setting up another unit by the manufacturer, the eligibility of exemption of which is independent of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed excisable goods, seized by the officers, is liable to confiscation and party is liable for penal action under Rule 25 of Central Excise Rules, 2002 for contravention of the said Rule in as much as they had wrongly availed area based exemption with the intent to evade payment of duty. 14. To verify the declarations made by M/s SD to the jurisdictional Central Excise Commissionerate, the relevant file of M/s SD was called for from the jurisdictional Assistant Commissioner, Central Excise Division, Roorkee. On examination of the aforesaid file, it transpired that the appellant had neither submitted the map regarding main unit at Plot F nor submitted any map showing factual expansion to the so-claimed adjacent plots. 15. It appears that the exemption from payment of excise duty which was initially extended to the appellant at Plot C and subsequently to Plot-F (the existing main unit), had been incorrectly availed in respect of their unit-II and Unit-III, in as much as M/s SD had not fulfilled the conditions as laid down in the aforesaid CBEC Board s Circular, during expansion of their units (Unit-II Unit-III). The main unit (at plot F/ Khasra -119) has no common boundar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17.11.2016. 16. From the foregoing paras it appears that M/s SD was liable to pay Central Excise duty to the tune of ₹ 5,43,55,005/- on the abated value of ₹ 43,48,40,037/-, as discussed above, during the period April, 2016 to 16.11.2016 and whereas they had failed to pay such duty, it appears that they had contravened the provisions of Central Excise Rules, 2002. Accordingly, show cause notice dated 11.05.2016 was issued invoking the extended period of limitation proposing to demand duty on the seized stock of shop finished goods valued at ₹ 1,11,15,072/- involving duty of ₹ 9,74,938/- seized by the Officer on 17.11.2016, which have been provisionally released with further proposal to demand of duty to the tune of ₹ 5,43,55,005/- on the dutiable goods cleared till 16.11.2016 with proposal to impose penalty under Rule 25, Rule 26 of Central Excise Rules, 2002. Further, penalty was also proposed under Rule 26 on Shri Saurabh Chhabra, Working Manager/ Partner of M/s spring Dells. The show cause notice was adjudicated on contest vide impugned order-in-original dated 26.12.2018 confirming the proposals in the show cause notice for levy of duty includi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 119 (Unit-III) and Plot F of Khasra No. 119 is having a continuous boundary. It is a single factory having an independent / separate entry / exit in North West. The adjudicating authority have erred in ignoring the certificate of Chartered Engineer without any plausible reason. Further, reliance is placed on the ruling in Dhampur Sugar Limited vs. CCE, Meerut -2001 (129) ELT 73 which have been upheld by the Hon ble Supreme Court reported in 2007 (216) ELT A23. Further, the appellant have common management and owner, single balance sheet and single factory registration (under Factories Act). 19. Further, Shri Saurabh Chhabra, Working Manager in his statement dated 17.11.2016 inter alia stated that they have made provisions for corridor running from both the expanded units with their main exempted unit, and in this manner they had interconnected them to the main unit. The connectivity to the main unit through the corridor fulfils the requirement of adjacent unit, particularly as the corridor has exclusively used by the appellant. The other unit namely M/s Jyoti Lab and M/s Fantasy do not have any interference / access to the said corridor. The contra view taken by the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her, reliance is placed on the ruling of Hon ble Supreme Court in Commissioner of Customs (Import) Mumbai vs. Dilip Kumar Company -2018 (361) ELT 577 (SC) wherein it has been held that in case of claim of tax exemption under a notification, the burden to prove for its entitlement is on the assessee claiming exemption. If there is any ambiguity in the exemption notification, the benefit of such ambiguity cannot be claimed by assessee and it must be interpreted in favour of Revenue. Further, reliance is placed on the ruling of A.P. High Court in Principal Commissioner of Service Tax vs. R. R. Global Enterprises Pvt. Limited - 2016 (45) STR 5 (A.P.) wherein it has been held that an exemption notification is a creation of statute and must be construed strictly. The Court should interpret notifications in such a way that discretion is reduced to minimum. Learned Authorised Representative also relied on the dictionary meaning of the word adjacent and the right synonym for adjacent is adjoining, contiguous, juxtaposed, meaning being in close proximity. Adjacent may or may not imply contact but always implies absence of anything of the same kind in between, like a house with an a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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