Strict compliance with closure-intimation rules governs abatement under the compounded levy scheme; late notice defeats relief.

Abatement under the compounded levy scheme was available only on strict compliance with Rule 96ZO(2)(a), which required written intimation of factory closure before or on the date of closure. Because the factories closed shortly before midnight and the notices were filed only the next day, the intimation was delayed by one day and did not satisfy the condition precedent. On those admitted facts, the planned closures did not qualify for abatement, and the disallowance was upheld.

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Issues: Whether the assessee was entitled to abatement for periods of factory closure when intimation of closure under Rule 96ZO(2)(a) of the Central Excise Rules, 1944 was given on the next day after the factory had already closed.

Analysis: Abatement under the compounded levy scheme under Section 3A of the Central Excise Act, 1944 is available only on fulfilment of the prescribed conditions. Rule 96ZO(2)(a) requires the manufacturer to inform the Central Excise authorities in writing about closure either prior to the date of closure or on the date of closure. On the admitted facts, the factories were closed shortly before midnight, but the intimations were filed only on the following day. That amounted to delayed intimation by one day and constituted non-compliance with the rule. Since the closures were planned and the delay was uniform across the relevant periods, the denial of abatement was justified.

Conclusion: The assessee was not entitled to abatement for the disputed closure periods, and the disallowance was upheld.

Final Conclusion: The appeal failed and the order denying abatement for 21 days was sustained.

Ratio Decidendi: Strict compliance with the statutory pre-closure or same-day intimation requirement is a condition precedent to availing abatement under the compounded levy scheme.

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