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TMI Blog2025 (4) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant is entitled to claim exemption from payment of central excise duty under the Exemption Notification in respect of goods manufactured and cleared from the factory of the appellant situated at 7 KM Stone, Muradabad Road, Kashipur. The said Exemption Notification grants exemption to goods, other than those specified in Annexure-I, manufactured and cleared from a unit located in the areas specified in Annexure-II of the Exemption Notification from payment of whole duty of excise or additional duty of excise. 3. The appellant is the owner of a contiguous piece of land situated at 7 KM Stone, Moradabad Road, Kashipur admeasuring 2.446 Hectares falling in Village Hariyawala, Tehsil Jaspur, District Udham Singh Nagar having Khasra No's. 281, 282, 283 and 284 in Khata Khatoni No's. 37 and 38 of the land records of Tehsil Jaspur, District Udham Singh Nagar. 4. Out of the aforesaid 4 Khasras, 3 Khasras namely Khasra No's. 282, 283 and 284 are mentioned at Serial No. C-29 of Annexure-II of the Exemption Notification dated 10.06.2003, but Khasra No. 281 measuring a meagre 0.146 Hectares is not included. 5. The appellant has indicated the nature of constructions on these four Kha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow: "The present appeal is filed against the Order-in-Original No. 31-32/2011 dated 25.2.2011. 2. The facts of the case are that the appellant's factory is located in the State of Uttaranchal and were availing the benefit of Notification No. 50/2003-CE under which the goods manufactured in the specified khasra numbers of village Hariawala, Tehsil Jaspur in District Udhamsingh Nagar, was exempted from Central Excise duty. Khasra Nos. 282, 283 and 284 are specified and 281 is not specified in the notification. It is the claim of the appellant that their factory is located in Khasra Nos. 282, 283 and 284. But their boundary wall is built enclosed a small strip of land falling under Khasra No. 281. This strip is actually a public drainage. The allegation of the Revenue is that they were not eligible for the said exemption because part of the land within their boundary wall falls in Khasra No. 281. So, duty was demanded and confirmed with equal amount of penalty, only for this reason. Being aggrieved, appellant has knocked the door of the Tribunal. 3. With this background, we have heard Shri Piyush Kumar, ld. Advocate for the appellant and Shri Yogesh Agarwal, ld. DR and also pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he party for exemption under notification no. 50/2003-CE dated 10.6.2003 w.e.f 30.01.2009 which is dependent on the fact whether khasra no. 281 is vacant with the boundary wall or factory is located in the said khasra. 5.2 As it was not possible to visit the factory since it was revealed that the unit is lying closed, jurisdictional Assistant Commissioner, CGST, Kashipur was directed to submit a report on the basis of factual position on the ground as well as on the basis of available records. Assistant Commissioner, Kashipur vide his report dated 1.11.2017 submitted that the factual position on the ground has been ascertained with the help of local administration. Sub Divisional Magistrate, Jaspur in his letter c.no. 309/S.T./2017 dated 30.10.2017, while referring to the report of Tehsildar, Jaspur, has informed that khasra no. 281 is situated in Vill. Hariywawala, Tehsil Jaspur and entire area of khasra no. 281 is in possession of M/s Diamond Entertainment Technologies (P) Limited and there is a water treatment plant of the party situated in this khasra no. 281. The party has covered the total area of land/khasra by constructing a boundary wall. 5.3 On the basis of aforesai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing submissions: (i) The order is based on a report dated 01.11.2017 of the Assistant Commissioner, which in turn is based on a letter dated 31.10.2017 of the Sub-Divisional Magistrate submitted on the basis of a report submitted by the Tehsildar. However, neither the letter nor the report was ever made known to the appellant nor was it admitted in evidence before taking a decision. Learned counsel, therefore, submitted that no reliance can be placed on this report; (ii) Even otherwise, the report is factually incorrect as Khasra No. 281 does not have a Water Treatment Plant. In fact it only contains drain and a sewage treatment pit and a boundary wall; (iii) Khasra No. 281 measures 0.146 Hectares and is 290 Meters in length and 2.53 Meters in width and is located next to a government drain and has a boundary wall. It has a sewer line for extermination of sewage from the factory/ administrative block toilets and a pit for treatment of sewage before discharge in the government drain; (iv) The manufacturing activity of the appellant is for assembly of consumer electronic goods namely TV and washing machines from components procured from other manufacturers/imported and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacturing process connected with the production of these goods is carried out. Since a water treatment plant is situated in Khasra No. 281, which is within the precincts the factory, manufacturing activity is carried out in Khasra No. 281, which is not a Khasra mentioned in Annexure-II of the Exemption Notification and, therefore, the appellant would not be entitled to the benefit of the Exemption Notification. 16. The submissions advanced by the learned counsel for the appellant and the learned authorized representative appearing for the department have been considered. 17. It is not in dispute is that the appellant is the owner of Khasra No's. 281, 282, 283 and 284. 18. The layout plan clearly indicates that the entire manufacturing unit of the appellant is situated in Khasra No. 284, which measures 1.819 Hectares. Khasra No. 281 measures only 0.146 Hectares and is a long strip of land measuring 290 Meters in length and 2.53 Meters in width. The layout plan does not show that any manufacturing activity is carried in this Khasra No. 281, which is only about 7% of the total plot of the appellant. The appellant has placed reliance upon a report dated 20.01.2010 submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice nor part of the earlier proceedings and no response was invited from the appellant. No reliance can, therefore, be placed on these two documents, which in fact are the sole document on the basis of which the Commissioner has recorded a finding that manufacturing activity is being carried out in Khasra No. 281. 22. Even in this appeal, the department has not placed either the letter dated 01.11.2017 submitted by the Additional Commissioner or the letter dated 30.10.2017 submitted by the Sub-Divisional Magistrate. 23. The Tribunal, in the order dated 31.01.2017, had clearly held that if no manufacturing activity was carried out in Khasra No. 281, the department would have no case. From a perusal of the layout plan and the report dated 20.01.2010 submitted by the lekhpal, it is clear that no manufacturing activity was carried out in Khasra No. 281. The layout plan, in fact, clearly shows that the manufacturing activity was carried out only in Khasra No. 284. Khasra No. 281 admeasures 290 Meters in length and 2.53 Meters in width. It has a boundary wall and according to the appellant only a sewer line for extermination of sewage from the factory passes through Khasra No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect to particular plot numbers. We further clarify that the reference to plot or Khasra Numbers is only by way of abundant caution to identify the particular Industrial Area/Estate or the Growth Centre, etc. We have also taken notice of the fact as demonstrated during the course of hearing with reference to the map as certified by the Tehsildar/Patwari and a supervisor that the majority portion including the entire production activity is located in the specified plot numbers. Accordingly, in view of our findings and observations, we allow this appeal with consequential benefit to the appellant, if any, in accordance with law and set aside the impugned order." 27. The Civil appeal filed by the department to assail the said order of the Tribunal was dismissed by the Supreme Court on 26.10.2018. 28. In Saral Wire Craft, a Division Bench of the Tribunal, observed as follows: "3. It is not a disputed fact that all 8 khasras are adjacent where the unit was established. It is not necessary that every inch of the land will be utilized for installation of machines. There may be some area left free and open. Notification did not cover Khasra No. 130M which is only 0.0030 hectare. It m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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