Subsequent exemption after substantial expansion remains available where the governing circular permits a later notification benefit.

An existing unit that had earlier availed exemption under Notification No. 56/2002-C.E. could still claim exemption under Notification No. 1/2010-C.E. after a second substantial expansion, because the controlling Board Circular expressly permitted such later benefit if the notification conditions were satisfied. Prior use of the earlier area-based exemption did not bar the subsequent exemption. On that basis, the refund claims under the later notification were treated as valid and the exemption entitlement was sustained.

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Issues: Whether an existing unit which had earlier availed exemption under Notification No. 56/2002-C.E. could again avail exemption under Notification No. 1/2010-C.E. on a subsequent substantial expansion.

Analysis: The controlling clarification was the Board Circular stating that an existing unit which had availed exemption under Notifications No. 56/2002-C.E. and 57/2002-C.E. by way of substantial expansion could avail exemption under Notification No. 1/2010-C.E. again by way of second substantial expansion, provided the conditions of the later notification were satisfied. On that basis, prior enjoyment of the earlier exemption did not bar the later exemption. The refund claims granted under the later notification were therefore consistent with the governing clarification.

Conclusion: The respondent was entitled to the benefit of Notification No. 1/2010-C.E., and the refund claims were rightly sanctioned.

Final Conclusion: The appeal failed and the exemption claim under the later notification stood sustained.

Ratio Decidendi: Prior availing of an earlier area-based exemption does not preclude a subsequent exemption under a later notification for second substantial expansion when the governing circular expressly permits such benefit and the notification conditions are fulfilled.

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