Exception to section 3 of central excise act :  

Section 3A regarding power of CG to charge ED on the basis of ‘Capacity of Production’ in respect of ‘Notified Goods’ is an exception to section 3.

Section 3A provides that notwithstanding anything contained in section 3 ,where the CG ,having regard to the nature of the process of manufacture or production of excisable goods of any specified description , the extent of evasion of duty in regard to such goods or such other factors as may be relevant , is of the opinion that it is necessary to safeguard the interest of revenue ,specify ,by notification in the official gazette ,such goods as ‘Notified Goods’ and there shall be levied and collected duty of excise in accordance with the provisions of this section i.e. section 3A.

Note- The provisions of this section shall not apply to goods produced or manufactured ,by a 100% EOU and brought to any other place in India.

Section 3(1A ) provides that there is no distinction between excisable goods produced by the Government  and those produced by others ,with regard to payment of excise duty . Excise duty is payable on goods manufactured by or on behalf of the Government ( both central and state ) also

The ownership of goods is not a relevant consideration for levy of ED. Assessable value of manufactured products includes the cost of free samples.( Texmaco Ltd .v Collector of central excise ,Calcutta AIR ,1992 SC 180