I am directed to say that a doubt has arisen in respect of the formula prescribed under Notification No. 11/99-CE (N.T.) to No. 13/99-CE (N.T.) dated 16.2.99 and Notification No. 30/99-CE (N.T.) dated 11.5.99 for calculating rebate of excise duty paid on processed textile fabrics manufactured by independent processors to the extent that the formula in question does not take into consideration the abatement to be allowed, if any, in respect of the period for which a stenter remained closed during the month for which the rate of rebate is calculated.

2.     The matter has been examined.

3.     Attention is drawn to the formula prescribed under the aforesaid notifications. It may be noticed that in the formula, while determining the value of nominator (D x n), the definition of  'n' is "number of working chambers in respect of which duty of excise was paid in the said month". This was conscious decision that only the working chambers will be taken into account, keeping in view the possibility of abatements in cases where stenter are closed and sealed during the month under consideration. Therefore, while determining the rate of rebate, the duty paid against the chambers, which are closed (where such closure entitles the independent processors to claim abatement), have not to be included. The closure and sealing of stenter takes place under the supervision of the jurisdictional officers and this fact will obviously be known to the Department. In other words, "n" in the nominator of the formula refers to only those chambers (contained in a stenter), which are working. The closure of a stenter (chambers) for less than 7 days on which abatement is inadmissible may be treated as working stenter (chambers).

4.     The Board desires that the above clarification should be kept in mind while granting rebate on processed textile fabrics and it should be ensured that the formula should be applied correctly.