TANSI FABRICATION WORKS Vs. JOINT COMMISSIONER OF CENTRAL G S T & CENTRAL EXCISE, TIRUNELVELI SUB-COMMISSIONERATE

JUDGEMENT

(1.) The Writ petitioner herein is a Government of Tamil Nadu undertaking. It is engaged in the manufacture of Drums, Cash Chest and Iron Safe, File Tray, Steel Tank, Bench, Stool, Hospital Furniture etc. It had registered itself under the Central Excise Act 1944. Considering the peculiar nature of the petitioner, it had been granted exemption meant for small scale industries on an unit basis. This Court is now concerned with the activities of the unit of TANSI located at Alagai Nagar, Rajapalayam, Virudhunagar District.

(2.) In view of the exemption granted to the S.S.I., units, the petitioner could start with a clean slate as on 1st day of April every year. The petitioner will have to pay Excise duty in once the exemption limit stood crossed. The petitioner did not experience any difficulty till the issuance of the show cause notice dated 29.03.2006.

(3.) The Commissioner of Central Excise, Tirunelveli, placing reliance on the Rule 57H(7) of the Central Excise Rules, 1944, Rule 9(2) of the Cenvat Credit Rules, 2002 and Rule 11(2) of the Cenvat Credit Rules, 2004, took the view that the assessee ought to have reversed the inputs lying in stock, work in progress and inputs contained in semi-finished goods/final products on that day, when they went into the exemption regime on the 1st day of April.