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2011 (7) TMI 1028 - GUJARAT HIGH COURTValidity of notification by which annual capacity determination rules - Whether rules ultra vires Section 3A of the Central Excise Act - Held that:- where for a period of seven days or more nothing can be produced or manufactured, then, prorate reduction would be available under Sub-section(3) of Section3A and in case, the manufacturer/producer manufactures/produces something less than the annual production capacity (as determined under Sub-section(2) of Section3A), then, he can always approach the Commissioner, convince him that his annual capacity though is much, but, he has produced some quantity less than his annual capacity and as such case, he is entitled to refund. If the section takes care of the rights of the producer/manufacturer by providing that on less production/manufacture, he would be entitled to refund and the Supreme Court says that Section3A is relatable to the production and not the capacity only, then, it would not be proper to say that Section3A is ultra vires the Constitution. We would agree with the learned Counsel that excise can be levied on the production and/or manufacture and not otherwise, but, Section3A cannot be held to be ultra vires the Constitution or the Central Excise Act itself, simply because it provides levy of excise on the annual production capacity, specially when it gives a right to the manufacturer/producer to claim refund on less production - Following decision of Messers Gopal Iron & Steel, Co. (Gujarat) Ltd. & anr. [2006 (7) TMI 644 - GUJARAT HIGH COURT] - Decided in favour of Revenue.
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