Rural area classification for SSI exemption upheld on the strength of the competent revenue certificate.

Factory location was treated as a rural area for purposes of the small scale industry exemption under Notification No. 8/2001-CE because the competent Tahsildar's certificate stated that the site fell in a rural area. The Tribunal accepted that certificate as determinative, noting that the Revenue had not successfully challenged it before the appropriate revenue authorities. It declined to prefer the Revenue's contrary reliance on distance and urban-area classification under the Tamil Nadu Urban Land Tax Act, 1966. The assessee therefore remained entitled to the SSI exemption.

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Issues: Whether the factory location at Nerkundram was to be treated as a rural area for the purpose of the small scale industry exemption under Notification No. 8/2001-CE.

Analysis: The dispute turned on whether the land where the factory stood fell within a rural or urban area. The appellate authority had relied on a certificate issued by the Tahsildar stating that the factory site was in a rural area. The Tribunal held that the Tahsildar of the concerned area was the competent authority to certify the nature of the land for this purpose, and that the Revenue had not successfully challenged that certificate before the appropriate revenue authorities. On that basis, the Tribunal accepted the certified position rather than the Revenue's contrary contention based on distance and urban-area classification under the Tamil Nadu Urban Land Tax Act, 1966.

Conclusion: The factory was held to be situated in a rural area and the assessee remained entitled to the SSI exemption.

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