Small scale industry exemption under Notification No. 175/86-C.E. allowed where later permanent registration confirmed earlier provisional recognition.

Small scale industry exemption under Notification No. 175/86-C.E. was treated as available where a provisional SSI certificate and pending confirmation application preceded the later issue of the permanent certificate. The later certificate was regarded as confirming the earlier provisional recognition, and the unit's small-scale status was traceable to an earlier date of production and registration. On that basis, exemption could not be denied merely because the formal permanent certificate was issued after the disputed period. The note also reflects the Tribunal view that SSI registration may operate from the date of application or from the date the status is otherwise recognised.

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Issues: Whether the assessee was entitled to the benefit of Notification No. 175/86-C.E. for the period when the permanent small scale industry certificate was issued later, but the provisional certificate and application for confirmation had already been granted and made.

Analysis: The certificate issued in 1987 was treated as a confirmation of the earlier provisional certificate and the application already pending since 1984. The unit was found to have been recognised as a small scale industry, and the permanent certificate recorded the date of production as February 1985. The exemption under Notification No. 175/86-C.E. could not be denied merely because the formal permanent certificate was issued after the period of demand, when the status of the unit and the registration process were traceable to an earlier date. The reasoning was supported by earlier Tribunal decisions holding that, in such circumstances, SSI registration is to be treated as effective from the date of application or from the date the status is otherwise recognised.

Conclusion: The assessee was entitled to the exemption under Notification No. 175/86-C.E. for the disputed period.

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