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2017 (9) TMI 934 - AT - Central ExciseArea Based Exemption - N/N. 50/2003-CE dated 10.06.2003 - The main appellant obtained Central Excise registration in respect of Unit-I and filed a declaration on 21.04.2008 for availing area based exemption under Notification No.50/2003-CE dated 10.06.2003 in respect of Unit-II - Revenue entertained a view that the claim of the main appellant to the effect that Unit-I and Unit-II are to be dealt with separately for excise duty purposes and the exemption claimed for Unit-II on such basis, is not legally tenable - Held that: - there were certain factual errors recorded by the original authority while examining the dispute. He records that the excise registration and the declaration filed under Notification No. 50/03, covered entire premises. We note that in the intimation dated 21.04.2008, the appellant categorically displayed a site plan clearly demarcating Unit-I & Unit-II with a specific remark. Similarly, the original authority records that the term “unit” used in the said notification refers to the said “factory”. The original authority records that it does not matter for Central Excise purposes as to by which name – whether by name of plant, unit or the like, each set is described. Since each unit cannot be described as a factory, he proceeded to hold that the whole premises should be considered as single entity and exemption was accordingly denied. The CBEC vide their letter dated 21.03.2006 addressed to Secretary (Industrial Development), Government of Uttaranchal clarified that in case of a manufacturer, producing motor vehicles, if a new assembly line/ production line is installed after 31.03.2007, then the benefit of said notification would not be available to motor vehicles manufactured on such assembly/production line. In various decisions, the Tribunal held that terms “unit” and “factory” cannot be accorded the same meaning for the purpose of Notification No.50/03. A notification grants exemption to new industrial units or existing industrial units undertaking substantial expansion. The exemption is not with reference to a factory. This is clear from the wordings of the notification. We also agree that the definition of “factory” under Section 2(e) of the Central Excise Act is much wider and cannot be made applicable to a unit/industrial unit involved in manufacture of specified goods. All such units are necessary part of a factory, if located in the contagious area. Each division of a factory manufacturing different identifiable items or undertaking different identifiable processes will have to be considered as a unit of the factory. Appeal allowed - decided in favor of appellant.
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