Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise and Customs
Circular No. 939 /29 / 2010-CX
New Delhi, dated the 22nd December, 2010
To
All Directors General
All Chief Commissioners of Central Excise
All Chief Commissioners of Central Excise and Customs
Sir/Madam,
Subject: Scope of Notification Nos.49/2003-CE and 50/2003-CE both dated
10.06.2003
Kind attention is invited to Notification Nos. 49/2003-CE and 50/2003-CE both
dated 10.06.2003 which provide full exemption from excise duties to goods
cleared from industrial units in the states of Uttarakhand and Himachal Pradesh
for a period of ten years from the date of commencement of commercial
production. The exemption is available to new units set up or existing units
which have undergone substantial expansion in terms of the said notifications
and commence commercial production before the cut-off date, that is, on or
before 31.3.2010
2. Representations have been received from Trade and Industry Associations
seeking clarification on the availability of the exemption benefit under these
notifications in the following situations:
- Where a unit starts producing some new products after the cut-off date using
plant and machinery installed up the said cut-off date and without any further
addition to the plant and machinery.
- Where the installed capacity in a particular unit is upgraded after the
cut-off date, so as to increase the efficiency of the machinery by installing
ancillary machines or replacement of some parts etc but in such a way that it
does not lead to increase in capacity of production.
- Where new dosage forms are manufactured after the cut-off date on the same
line of production with the same machinery.
- Where a unit manufacturers a new product by installing fresh plant,
machinery or capital goods after the cut-off date.
- Board has examined the matter. Under the said notifications, any new unit set
up or an existing unit which has undergone substantial expansion that commences
commercial production before the cut-off date is entitled to excise duty
exemption in respect of excisable goods (other than those appearing in the
negative list) manufactured and cleared for a period of ten yeas from the date
of commencement of commercial production. The provisions of these notifications
do not place a bar or restriction on any addition/modification in the plant or
machinery or on the production of new products by an eligible unit after the
cut-off date and during the exemption period of ten years as per the
notification. Therefore, it is clarified that in all the above situations, the
benefit of the excise duty exemption under the notifications would continue to
be available to eligible industrial units. However the period of exemption would
remain ten years and would not get extended on account of such modifications or
additions under any circumstances.
- Trade and industry and field formations may be suitable informed.
- Receipt of the Circular may be acknowledged.
- Hindi version will follow.
Yours faithfully
(Dr. Ravindra J Dange)
Under Secretary (CX-3)
F.No.102/2/2010-CX-3