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TMI Blog2002 (2) TMI 252X X X X Extracts X X X X X X X X Extracts X X X X ..... rmination Rules, 1997 and they were required to pay Central Excise duty amounting to Rs. 69,150/- per month. 2. The appellants closed their factory permanently on 4-12-97 and surrendered their registration certificate. They intimated the Commissioner, Assistant Commissioner, and the jurisdictional Range Superintendent vide their letter dated 5-12-97 that their factory was closed permanently from 4-12-97. They submitted that in terms of the proviso to sub-section (2) of Section 3A of the Central Excise Act, 1944, they were not liable to pay the duty for the period from December, 1997 to March, 1998. They were however, issued four show cause notices dated 3-4-98 to 25-5-98 demanding duty of Rs. 4,14,900/- for the period October, 1997 to Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssions made before us. The lower appellate authority in his order has observed that the relief under the proviso to Section 3A(2) is not available to the appellants since the same would be available to them for fixing the ACP for the next year i.e. 1998-99. The provisions under the proviso to Section 3A(2) are reproduced below : "(2) Where a notification is issued under sub-section (1), the Central Government may, by rules, provide for determination of the annual capacity of production, or such factor or factors relevant to the annual capacity of production of the factory in which such goods are produced, by the Commissioner or Central Excise and such annual capacity of production shall be deemed to be the annual production of such goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f production capacity of a mill under Rule 96ZO(3) read with Section 3A(4). The Hon'ble Supreme Court in their judgment have observed that once an assessee exercises his option of paying duty under Rule 96ZO(3), he cannot go back to the provisions of Section 3A(4) which provide payment of duty on actual capacity of production. This judgement no where refers to the provisions under the proviso to Section 3A(2). 7. In view of the above analysis, therefore, we hold that the benefit of abatement from payment of duty for the period of closure of the mill is available to the appellants under Section 3A(2). The appeal is accordingly allowed by setting aside the impugned order of Commissioner (Appeals). - - TaxTMI - TMITax - Central Excis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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