Abatement under compounded levy scheme depends on timely closure intimation; relief applies only from the date notice is duly given.

Under the compounded levy scheme, abatement of duty is available only for the period of continuous factory closure for which the statutory intimation requirements are complied with. Rule 96ZO(2) required written notice of closure to the Assistant Commissioner, with a copy to the Superintendent, before or on the date of closure, together with meter reading and closing stock details, and notice of resumption on restart. Although the closure exceeded seven days and the assessee's notices were acknowledged, the intimation was not timely for the first few days of closure. Abatement was therefore allowed only from 12-12-1997 to 31-12-1997, and denied for 8-12-1997 to 11-12-1997.

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Issues: Whether the assessee was entitled to abatement of duty for the period during which the factory remained closed, and if so, from what date such abatement was allowable.

Analysis: Proviso to Section 3A(3) permits abatement on a proportionate basis where the factory does not produce goods for a continuous period of not less than seven days, subject to compliance with the prescribed conditions. Rule 96ZO(2) requires written intimation of closure to the Assistant Commissioner, with a copy to the Superintendent, either before or on the date of closure, together with the electricity meter reading and closing stock details, and a similar intimation on resumption of production. The assessee informed the Assistant Commissioner of closure by letter dated 12-12-1997 and of resumption by letter dated 31-12-1997, both delivered by hand and acknowledged in the office. The continuous closure exceeded seven days, but the intimation was not given on or before 8-12-1997.

Conclusion: The assessee was entitled to abatement for the period from 12-12-1997 to 31-12-1997, but not for 8-12-1997 to 11-12-1997.

Ratio Decidendi: Abatement under the compounded levy scheme is available only for the period of closure for which the statutory intimation requirements are complied with, and the benefit cannot relate back to days for which the prescribed notice was not timely given.

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