Judgment: 1. The respondents were working under compounded levy scheme. However, they surrendered their licence and registration certificate under their letter dated 14-12-1998. The said letter was accepted by the department on the same day. The factory was leased out to another manufacturer under an agreement dated 16-12-1998. The new manufacturer started their manufacturing activities with effect from 1-1-1999.
2. Proceedings initiated against the respondents for the period 16-12-1998 to 31-12-1998 were dropped by the Commissioner (Appeals) by observing that the respondents was no longer manufacturer during the said period and had surrendered his licence. I do not find any infirmity in the above view of the appellate authority. Once an assessee stops to be a manufacturer and surrendered his licence, which also stands accepted by the revenue, there is no justification for demanding duty for the subsequent period. As such, I do not find any merits in the revenue's appeal and reject the same.