Factory closure requirement governs duty abatement; shutting only one furnace and missing closure proof defeats the claim.

Abatement of duty under the proviso to Section 3A(3) of the Central Excise Act was unavailable because the statutory requirement is closure of the entire factory for a continuous period of not less than seven days; closure of only one furnace while another remained in operation did not satisfy that condition. The claim also failed for non-compliance with Rule 96ZO(2) of the Central Excise Rules, 1944, as the required continuous closure certificate was not furnished. The document states that both the substantive factory-closure condition and the prescribed procedural documentation are mandatory for abatement, so the rejection of the claim was sustained.

---

---

Issues: (i) Whether abatement of duty under the proviso to sub-section (3) of Section 3A of the Central Excise Act was allowable when only one furnace in the factory remained closed and the other continued to operate. (ii) Whether non-compliance with Rule 96ZO(2) of the Central Excise Rules, 1944 defeated the claim for abatement.

Issue (i): Whether abatement of duty under the proviso to sub-section (3) of Section 3A of the Central Excise Act was allowable when only one furnace in the factory remained closed and the other continued to operate.

Analysis: The proviso permits abatement only where the factory does not produce notified goods during a continuous period of not less than seven days. The appellants operated two furnaces, and only one was closed during the relevant period. The expression used in the provision is "factory", not individual furnace or unit. The closure of one furnace could not be treated as closure of the entire factory for the purpose of abatement. The earlier appellate remand also meant that the prior partial allowance did not survive.

Conclusion: Abatement was not admissible; the finding is against the assessee.

Issue (ii): Whether non-compliance with Rule 96ZO(2) of the Central Excise Rules, 1944 defeated the claim for abatement.

Analysis: The record showed failure to furnish the continuous closure certificate required by the rule. Since the statutory precondition for claiming abatement was not satisfied, the claim could not be sustained on this ground as well.

Conclusion: The claim was rightly rejected for non-compliance with Rule 96ZO(2); the finding is against the assessee.

Final Conclusion: The demand for abatement failed on both the substantive statutory requirement and the prescribed procedural compliance, so the adjudicating authority's rejection was sustained.

Ratio Decidendi: For abatement under the proviso to sub-section (3) of Section 3A of the Central Excise Act, the entire factory must remain closed for the prescribed continuous period, and closure of only one furnace does not satisfy that requirement; compliance with the prescribed closure documentation is also mandatory.

---