Commercial production test under exemption notification favored the unit, with commissioning and actual output proving eligibility before the cutoff.

Commercial production, not trial production, was the test for exemption under Notification No. 50/2003-CE, and it began when the plant was commissioned and capable of producing goods of the desired quality, even if not at full capacity. The evidence of intended commencement before the cut-off date, furnace commissioning by 30.03.2010, raw material procurement and consumption, power use on 30.03.2010 and 31.03.2010, and clearance of ingots in March 2010 supported commencement on or before 31.03.2010. The department's load-supply analysis alone was insufficient to displace the commissioning certificate and surrounding proof of actual production, so the unit qualified for the exemption.

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Issues: Whether the appellant unit had commenced commercial production on or before 31.03.2010 so as to qualify for exemption under Notification No. 50/2003-CE dated 10.06.2003.

Analysis: The exemption was available to new industrial units in the specified area that commenced commercial production not later than 31.03.2010. Commercial production was distinguished from trial production and was held to begin when the plant was commissioned and in a position to manufacture goods of the desired quality, even if not at full capacity from day one. The evidence showed declaration of intended commencement before the cut-off date, installation and commissioning of the furnace by 30.03.2010, procurement and consumption of raw materials, power consumption on 30.03.2010 and 31.03.2010, and clearance of about 30 MT of ingots during March 2010. The department relied mainly on load-supply analysis, but that alone was insufficient to dislodge the commissioning certificate and the surrounding evidence of actual production.

Conclusion: The appellant had commenced commercial production on or before 31.03.2010 and was entitled to exemption under Notification No. 50/2003-CE dated 10.06.2003.

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