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Small Scale Sector (New Exemption Scheme w.e.f 1.4.1999)
Notification No. 9 dated 28th
February 1999 (As amended by 22/99, 24/99, 5/00, 11/00)
In exercise of the powers conferred by sub-section (1) of section 5A of
the Central Excise Act, 1944(1 of 1944), the Central Government, being satisfied
that it is necessary in the public interest so to do, hereby exempts clearances
specified in column (2) of the Table below (hereinafter referred to as the said
Table), for home consumption, of excisable goods of the description specified in the Annexure appended to this notification
(hereinafter referred to as the specified goods), from so much of each of the
duties of excise specified thereon in the First Schedule to the Central Excise
Tariff Act, 1985 (5 of 1986) or the Second Schedule to the said Central Excise
Tariff Act, as the case may be, as in excess of the amount calculated at the
rate specified in the corresponding entry in column (3) of the said Table.
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S. No.
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Clearances
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Rate of duty
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(1)
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(2)
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(3)
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1.
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First clearances upto an aggregate value not exceeding fifty lakh
rupees made on or after the 1st day of April in any financial year.
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Sixty percent of normal rate of duty
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2.
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Clearances upto an aggregate value not exceeding fifty lakh rupees
immediately following the clearances specified against Sl. No. 1 above during
the financial year.
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Eighty percent of normal rate of duty
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3.
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All clearances of the specified goods which are used as inputs for
further manufacture of any specified goods within the factory of production of
the specified goods.
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Nil
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2. The
exemption contained in this notification shall apply only subject to the
following conditions, namely: -
(i)
a manufacturer who intends to avail the exemption under this notification
shall exercise his option in writing for availing the exemption under this
notification before effecting the first clearances of specific goods and such
option shall be effective from the date of exercise of the option which shall
not be withdrawn during the remaining part of the financial year.
(ii)
While exercising the option under condition (i), the manufacturer shall
inform in writing to the jurisdictional Assistant Commissioner of Central Excise
with a copy to the Superintendent of Central Excise giving the following
particulars, namely: -
(a)
name and address of the manufacturer;
(b)
location/ locations of factory/ factories;
(c) description
of specified goods produced;
(d) date
from which option under this notification has been exercised;
(e) aggregate
value of clearances of specified goods (excluding the value of clearances
referred to in para 3 of this notification) till the date of exercising the
option.
(iii) where
a manufacturer opts for availing the exemption under this notification in terms
of condition (i)above, the clearances of specified goods already made during the
financial year, prior to the exercise of such option, shall be taken into
account for computing the aggregate value of clearances, as specified in the
said Table.
ILLUSTRATION I: A manufacturer who
has been paying the normal duty on any goods during a financial year opts to
avail of this exemption after making clearances having an aggregate value of
rupees twenty lakhs. He is entitled
under this notification to additional clearances of an aggregate value of rupees
thirty lakhs at the concessional rate of 60% of normal duty and further
clearances of an aggregate value of rupees fifty lakhs at the concessional rate
of 80% of normal duty.
ILLUSTRATION II: A manufacturer who
has been paying the normal duty on any goods during a financial year opts to
avail of this exemption after making clearances having an aggregate value of
rupees seventy lakhs. He is
entitled under this notification to additional clearances of an aggregate value
of rupees thirty lakhs at the concessional rate of 80% of normal duty.
ILLUSTRATION III: A manufacturer
who has been availing of full exemption on any goods during a financial year
under notification No. 8/99-CE, dated the 28th February, 1999, opts
to avail of this exemption after making clearances having an aggregate value of
rupees twenty lakhs. He is entitled
under this notification to additional clearances of an aggregate value of rupees
thirty lakhs at the concessional rate of 60% of normal duty and further
clearances of an aggregate value of rupees fifty lakhs at the concessional rate
of 80% of normal duty.
ILLUSTRATION IV: A manufacturer has availed of full exemption on any goods during a
financial year upto an aggregate value of rupees fifty lakhs under notification
No. 8/99-CE, dated 28th February, 1999, He has subsequently availed
of the concessional rate of duty of five percent ad valorem on clearances having
an aggregate value of rupees twenty lakhs under the same notification, when he
opts to avail this exemption. He is
entitled under this notification to additional clearances of an aggregate value
of rupees thirty lakhs at the concessional rate of 80% of normal duty.
(iv)
where a manufacturer clears the specified goods from one or more
factories, the exemption in his case shall apply to the aggregate value of
clearances mentioned against each of the serial numbers in the said Table, and
not separately for each factory;
(v)
where the specified goods are cleared by one or more manufacturers from
the factory, the exemption shall apply to the aggregate value of clearances
mentioned against each of the serial numbers in the said Table and not
separately for each manufacturer;
(vi)
the aggregate value of clearances of all excisable goods for home
consumption by a manufacturer from one or more factories, or from a factory by
one or more manufacturers, has not exceeded rupees three hundred lakhs in the
preceding financial year:
3.
For the purpose of determining the aggregate value of clearances of the
specified goods for home consumption, the following clearances shall not be
taken into account, namely: -
(a)
clearances, which are exempt from the whole of the excise duty leviable
thereon (other than an exemption based on quantity or value of clearances) under
any other notification or on which no excise duty is payable for any other
reason;
(b) clearances
bearing the brand name or trade name of another person, which are ineligible for
the grant of exemption under this
notification in terms of paragraph 4 below;
(c) clearances
of specified goods which are used as inputs for further manufacture of any
specified goods within the factory of production of the specified goods;
(d) clearances
of strips of plastics used within the factory of production for weaving of
fabrics or for manufacture of sacks or bags made of polymers of ethylene or
propylene.
4.
The exemption contained in this notification shall not apply to the
specified goods bearing a brand name or trade name, whether registered or not,
of another person, except in the following cases, namely: -
(a)
where such specified goods, being in the nature of components or parts of
any machinery or equipment or appliances, are cleared for use as original
equipment in the manufacture of the said machinery or equipment or appliances by
following the procedure laid down in Chapter X of the Central Excise Rules,
1944;
Provided that manufacturers, whose aggregate value of clearances
for home consumption of such specified goods for use as original equipment does
not exceed rupees fifty lakhs in a financial year, as calculated in the manner
specified in the said Table, may submit a declaration regarding such use instead
of following the procedure laid down in Chapter X of the said rules;
(b) where the
goods bear a brand name or trade name of-
(i) the Khadi and Village Industries Commission;
or
(ii) a State Khadi and Village Industry Board; or
(iii) the National Small Industries Corporation;
or
(iv) a State Small Industries Development
Corporation; or
(v) a State Small Industries Corporation.
(c) where the
specified goods are manufactured in a factory located in a rural area.
5. This
notification shall come into force on the 1st day of April, 1999
and shall remain in force upto and inclusive of the 31st day of
March, 2000.
Explanation: For the purposes of
notification, -
(A) �brand name� or �trade name� shall
mean a brand name or trade name, whether registered or not, that is to say a
name or a mark, such as symbol, monogram, label, signature or invented word or
writing which is used in relation
to such specified goods for the purpose of indicating, or so as to indicate a
connection in the course of trade between such specified goods and some person
using such name or mark with or without any indication of the identity of that
person;
(B) where specified goods manufactured by a
manufacturer bear a brand name or trade name, whether registered or not, of
another manufacturer or trader, such specified goods shall not, merely by reason
of that fact, be deemed to have been manufactured by such other manufactured or
trader;
(C) �value� means,-
(i) in respect of specified goods which have been
notified under section 4A of the Central Excise Act 1944( 1 of 1944), as
determined in accordance with the provisions of that section; and
(ii) in respect of specified goods other than
those referred to in sub clause (i), the value as determined in accordance with
the provisions of section 4 of the Central Excise Act, 1944 (1 of 1944), or the
tariff value fixed under section 3 of the said Act;
(D) in the determination of the value of
clearances of Chinaware or Porcelainware or both, where a manufacturer gets
Chinaware or porcelainware or both fired in a kiln belonging to or maintained by
a Pottery Development Centre run by the Central Government or a State Government
or by the Khadi and Village Industries Commission, the value of the Chinaware or
Porcelainware or both, belonging to the said manufacturer and fired in such a
kiln shall be taken into account;
(E) where the specified goods are manufactured in
a factory belonging to or maintained by the Central Government or by a State
Government, or by a State Industries Corporation, or by a State Small Industries
Corporation or by the Khadi and Village industries Commission, then the value of
excisable goods cleared from such factory alone shall be taken into account;
(F) �normal rate of duty� means
(i) in the case of goods leviable to duty under
the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), at the
rate specified for such goods in that Schedule read with any relevant
notification (other than this notification or a notification in which exemption
is based on the value or quantity of clearances) issued under sub-section (1) of
section 5A of the Central Excise Act, 1944
(ii) in the case of goods leviable to duty under
the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), at the
rate specified for such goods in that Schedule read with any relevant
notification (other than this notification or a notification in which exemption
is based on the value or quantity of clearances) issued under sub-section (1) of
section 5A of the Central Excise Act, 1944.
(G) �clearances for home consumption� shall
also include clearances for export to Bhutan or Nepal.
(H) �rural area� means the area comprised in
a village as defined in the land revenue records, excluding -
(i) the area under any municipal committee,
municipal corporation, town area committee, cantonment board or notified area
committee, or
(ii) any area that may be notified as an urban
area by the Central Government or a State Government.
ANNEXURE
All goods specified in the Schedule to the Central Excise Tariff Act,
1985 (5 of 1986), other than the following namely, -
(i) all
goods which are chargeable to nil rate of duty or are exempt from the whole of
the duty of excise leviable thereon;
(ii) all goods
falling under heading No. 09.02;
(iii) all goods
falling under heading No. 21.06 and sub-heading Nos. 2101.10 and 2101.20;
(iv)
all goods falling under Chapter 24 of the said Schedule (other than
unbranded chewing tobacco and preparations containing chewing tobacco, falling
under heading No. 24.04 of the said Schedule);
(v) all goods
falling under heading No. 25.04;
(vi) sandalwood
oil all goods falling under heading Nos. 33.04 and 33.05, and sub heading Nos.
3307.10, 3307.20, 3307.31, 3307.39, 3307.50 and 3307.90;
(vii) all goods
falling under heading No. 36.05;
(viii) all goods falling
under heading Nos. 37.01, 37.02 and sub-heading No. 3703.10;
(ix) strips of
plastics intended for weaving of fabrics or sacks, polyurethane foam and
articles of polyurethane foam; falling under Chapter 39;
(x)
all goods falling under heading No. 40.05 (except rubber solution or
vulcanising solution), and
sub-heading No. 4006.10 and plates, sheets and strips falling under heading No.
40.08, for resoling or repairing or retreading rubber tyres;
(xi)
all goods falling under Chapter 51 of the said Schedule other than those
falling under sub-heading Nos. 5105.30 and 5105.40 and heading Nos. 51.06,
51.07, 51.08, 51.09, 51.10 and 51.11 (except woven fabrics of wool falling under
heading Nos. 51.10 or 51.11) and under 51.12;
(xii) all
goods falling under Chapter 52 of the said Schedule other than goods falling
under heading No. 52.04 and cotton yarn not containing synthetic staple fibre,
falling under heading No. 52.05 or 52.06;
(xiii) all
goods falling under Chapter 53 of the said Schedule except goods falling under
heading Nos. 53.01, 53.02, 53.04, 53.05, 53.08 (other than goods falling under
sub-heading No. 5308.14), 53.11 (other than woven fabrics of ramie);
(xiv) all goods falling
under Chapter 54 of the said Schedule except goods falling under heading No.
54.01;
(xv) all
goods falling under Chapter 55 of the said Schedule except goods falling under
heading Nos. 55.05, 55.08 and shoddy yarn manufactured from used or new rags
falling under heading No. 55.09 or 55.10;
(xvi) all
goods falling under Chapter 56 of the said Schedule except goods falling under
heading Nos. 56.01, 56.02, 56.03, 56.04, 56.05 (other than of manmade
filaments), 56.07 (other than of jute), 56.08 and 56.09;
(xvii) all goods falling
under Chapter 57 of the said Schedule;
(xviii) all
goods falling under Chapter 58 of the said Schedule except goods falling under
heading Nos. 58.03, 58.06, 58.07, 58.08, uncut grey (unprocessed) woven weft
pile fabrics of cotton manufactured from grey unprocessed cotton yarn falling
under sub-heading No. 5801.21, fabrics of cotton or man-made fibres falling
under sub-heading No. 5802.51, and unprocessed cotton terry towelling fabrics
falling under sub-heading No. 5802.21;
(xix) all
goods falling under Chapter 59 of the said Schedule except goods falling under
heading Nos. 59.01, 59.05, 59.06, 59.08, 59.09, 59.10, 59.11 and textile fabrics
coated or laminated with preparations of low-density polyethylene;
(xx) all
goods falling under Chapter 60 of the said Schedule except goods falling under
sub-heading No. 6002.10 and fabrics of cotton man-made fibres not subjected to
any process falling under heading Nos. 60.01 or 60.02;
(xxi) all goods falling
under Chapter 61 of the said Schedule;
(xxii) all goods falling
under Chapter 62 of the said Schedule
(xxiii) blankets of wool falling
under Chapter 63 of the said Schedule;
(xxiv) all
goods falling under heading Nos. 72.06, 72.07, 72.18, 72.24 cold rolled
stainless steel pattis / pattas falling under chapter 72; ingots and billets of
non alloy steel falling under sub-heading Nos. 7206.90 and 7207.90 and hot
re-rolled products of non-alloy steel, falling under sub-heading Nos. 7211.11,
7211.19, 7211.30, 7211.52, 7211.59, 7211.60, 7211.92, 7211.99, 7213.90, 7214.90,
7215.90, 7216.10 and 7216.90, on which the duty of excise is paid under section
3A of the Central Excise Act, 1944 (1 of 1944);
(xxv) (A) all goods falling under -
(a) heading No. 74.03, excluding the following
goods falling under sub-heading No. 7403.21-
(i) cast brass bars/ rods of a length not
exceeding 3 feet.
(ii) cast brass bars/ rods of a length not
exceeding 10 feet used in the factory of production for making wires falling
under sub-heading No. 7408.29.
(iii) copper flats of a weight not exceeding 2
kilograms used for making copper strips falling under heading No. 74.09.
(iv) brass billets weighting upto five kilograms.
(b) heading No. 74.09 (excluding copper strips
produced from copper flats of a weight not exceeding 2 kilograms).
(c) sub-heading Nos. 7407.11, 7407.12, 7408.11,
7408.21; and
(B) copper
circles, whether or not trimmed.
(xxvi) aluminium circles, whether
or not trimmed, falling under Chapter 76;
(xxvii) refrigerating and air conditioning appliances and machinery and
parts and accessories thereof
falling under Chapters 84, 85 and 90
(xxviii) all goods falling under heading Nos. 85.21, 85.28;
(xxix) all
goods falling under heading Nos. 87.01, 87.02, 87.03, 87.04, 87.05, 87.06 and
87.11 [other than powered cycles and powered cycle rickshaw (powered cycle or
powered rickshaw means a mechanically propelled cycle or, as the case may be,
mechanically propelled cycle rickshaw, which may also be peddled, if any
necessity arises for so doing);
(xxx) all goods falling
under heading Nos. 91.01 or 91.02;
(xxxi) all goods falling under
sub-heading Nos. 9605.10.
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