Kind attention is invited to Circular 682/73/2002, dated 19.12.2002, issued by the TRU in respect of notifications No. 56/2002 and 57/2002, both dated 14.11.2002, applicable for units availing area based exemption in J & K. In para 3 of the said Circular, following clarification was issued:

“ 3. In this context, it may be pointed out that the “Refund” envisaged in the notifications is not on account of any excess payment of excise duty by the manufacturers, but is basically designed to give effect to the exemption. In other words, the mechanism has been adopted to operationalize the exemption envisaged in these two notifications. In view of this aspect of the matter, the provisions of Section 11B of the Central Excise Act, 1944 would not apply in the case of these notifications.”

2. Representations have been received in the Ministry, seeking clarification as to whether the clarification given by the TRU in the above mentioned Circular will also be applicable for refund granted to units located in Kutch area availing benefit of notification No. 39/2001 dated 31.7.2001.

3. The matter has been examined by the Board. It is noticed that when same scheme of refund is founded for other areas, the clarification issued with reference of J & K should hold good, and there should not have been any doubt. Therefore, it is clarified that clarification issued vide para-3 of Circular No. 682/73/2002, dated 19.12.2002, will also be applicable for units availing exemption under notification No. 39/2001-CE dated 31.7.2001 (Kutch) , 71/2003-CE dated 9.9.2003 and 56/2003 dated 25.6.2003 (Sikkim),32/99-CE and 33/99-CE both dated 8.7.1999 (North East).