Duty abatement under Section 3A(3) denied where furnaces kept operating and the unit was not treated as separate factories.

Abatement of duty under the proviso to Section 3A(3) of the Central Excise Act was not available because the factory did not remain out of production for a continuous period of at least seven days; one or more furnaces stayed operational throughout the relevant period. The contention that each furnace constituted a separate factory was rejected because the premises were treated as one factory under Section 2(e), and there was no showing of separate ACP orders or separate registrations to support independent treatment. The objection based on suspension of Rule 96ZO(3) also failed, as the impugned order only denied abatement and did not determine any quantified demand under that rule.

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Issues: Whether abatement of duty under the proviso to Section 3A(3) of the Central Excise Act, 1944 was available when at least one furnace remained operational during the relevant period, and whether the furnaces could be treated as separate factories for that purpose.

Analysis: The proviso to Section 3A(3) permits abatement only where a factory producing notified goods does not produce such goods for a continuous period of not less than seven days. The factual finding was that one or more furnaces were always operating, so the factory as a whole never ceased production for seven continuous days. The definition of factory in Section 2(e) did not support treating each furnace as an independent factory within the same premises, particularly when the unit was not shown to have separate ACP orders or separate registrations under the relevant rules. The challenge based on suspension of Rule 96ZO(3) was also rejected because the impugned order only denied abatement and did not determine a quantified demand under that rule.

Conclusion: Abatement of duty was rightly denied, and the contention that each furnace constituted a separate factory was rejected.

Final Conclusion: The appeal failed on the sole substantive issue and the denial of duty abatement was sustained.

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