Installed capacity exemption under North-East notification upheld where overall 25% increase was proved for the manufacturing units.

Notification No. 33/99-C.E. allowed exemption to existing manufacturing units in the North-East Region where the units achieved an overall 25% increase in installed capacity. The finding that the respondents' installed capacity had increased by 25% was supported by production figures and other material accepted by the Commissioner, and the Revenue produced no rebuttal. The notification required an overall increase in installed capacity; it did not require each wing or section of the factory to show a separate 25% increase. On that basis, the exemption was available to the respondents and the Revenue's appeals failed.

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Issues: Whether the benefit of Notification No. 33/99-C.E. was admissible where the existing manufacturing units in the North-East Region had achieved an overall increase of 25% in installed capacity.

Analysis: The Notification granted exemption where the existing manufacturing units had increased their installed capacity by 25%. The Commissioner had accepted the respondents' evidence, including production figures and other material, to record a finding that the installed capacity of the units had increased by 25%. The Revenue did not produce any material to rebut this finding. The Notification required an overall increase in installed capacity and did not mandate that every wing or section of the factory must individually show a 25% increase.

Conclusion: The exemption under the Notification was available to the respondents, and the Revenue's appeals failed.

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