Abatement of duty for factory closure under Rule 96ZP(2) cannot be denied where the qualifying shutdown is established.

Abatement of duty under Rule 96ZP(2) is available where factory closure for a continuous period of at least seven days is established and not disputed. The rule sets only a minimum closure period and does not impose a maximum limit, so abatement cannot be refused merely because duty is otherwise computed with reference to annual capacity of production. On the facts stated, the closure period qualified for relief and the duty demand was unsustainable.

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Issues: Whether abatement of duty under Rule 96ZP(2) was allowable for the period of closure of the factory, and whether duty remained payable on the basis of annual capacity of production despite such closure.

Analysis: Rule 96ZP(2) permits abatement where the factory remains closed for a continuous period of not less than seven days. The closure of the factory during the relevant period was accepted on the record and was not effectively disputed by the Revenue. The rule prescribes only the minimum period of closure and does not lay down any maximum limit. In these circumstances, the claim for abatement could not be denied merely because the duty was otherwise worked out on the basis of annual capacity of production. The Revenue's challenge, therefore, failed.

Conclusion: Abatement was rightly granted and the duty demand was not sustainable.

Final Conclusion: The Revenue's appeal failed, and the order granting abatement of duty for the closure period was sustained.

Ratio Decidendi: Where closure of a factory for the qualifying statutory period is established and not disputed, abatement of duty cannot be denied merely because duty is computed with reference to annual capacity of production.

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