2000 (1) TMI 382 - AT - Central Excise

Appeals granted: Notification benefits upheld despite address change. Manufacturing criteria key. /86

The Tribunal allowed both appeals, confirming the Appellants' entitlement to the benefits of Notification No. 175/86 for the relevant years. The decision ... SSI Exemption Issues:1. Whether the benefit of Notification No. 175/86-C.E., dated 1-3-1986 is available to the Appellants M/s. Nirmal Rubber & Engineering Works.Analysis:1. The Appellants, M/s. Nirmal Rubber & Engineering Works, appealed regarding the availability of the benefit of Notification No. 175/86-C.E. for their manufacturing units. The issue arose when a show cause notice alleged that the Appellants had misdeclared clearances between their two units to wrongly avail the notification's benefits. The Commissioner allowed the benefit for 1988-89 but denied it for subsequent years due to a change in unit location and lack of SSI Registration for Unit No. 2.2. The Appellants argued that the demand for 1989-90 was incorrectly raised as the provisional SSI Certificate was valid, and the approved classification list was never reviewed. They contended that shifting the unit's location within the same city did not affect eligibility, citing legal precedents. They also claimed entitlement to the notification's benefits for 1989-90 based on the previous year's eligibility, as per relevant legal decisions.3. The Respondent countered, alleging that clearances from Unit No. 1 were actually from Unit No. 2, questioning the validity of permissions under Rule 56B. However, the Appellants clarified that clearances were combined for both units for notification compliance and provided evidence of permission validity for five years.4. The Tribunal observed that Unit No. 2 held a provisional SSI registration, making it eligible for the notification's benefits for 1988-89. Referring to legal interpretations, the Tribunal ruled that the Appellants were entitled to the benefits for subsequent years as well. The Tribunal emphasized that the notification's availability is based on manufacturing eligibility, not the filing of classification lists, especially when the unit's address change was duly updated and approved.5. Ultimately, the Tribunal allowed both appeals, confirming the Appellants' entitlement to the benefits of Notification No. 175/86 for the relevant years, emphasizing the legal precedence supporting their position and the lack of procedural grounds to deny the benefits based on the unit's location change within the same city.