2004 (2) TMI 578 - AT - Central Excise

Summary

Issues:
1. Whether Naphtha used in the manufacture of Fertilizer is exempt in terms of Notification No. 5/99.

Analysis:
The issue before the Appellate Tribunal was to determine the eligibility of Naphtha used in the manufacture of fertilizer for exemption under Notification No. 5/99. The Revenue contended that Naphtha is eligible for exemption only if used as feedstock in accordance with specific serial numbers of the notification. On the other hand, the appellants argued that the Supreme Court had already ruled in a previous case that Naphtha used in fertilizer manufacturing is indeed eligible for exemption.

The Tribunal carefully examined the relevant entry in Notification 5/99, which mentions "Naphtha and Natural Gasoline Liquid for use in the manufacture of fertilizer or ammonia." The Tribunal noted that the term "feedstock" was not explicitly mentioned in the entry, and therefore, the exemption cannot be denied based on the absence of this specific term. The Tribunal emphasized that there is no room for interpretation where the language of the law is clear. Consequently, the Tribunal found no fault in the impugned order and dismissed the appeal filed by the Revenue.

In conclusion, the Appellate Tribunal ruled that Naphtha used in the manufacture of fertilizer is indeed exempt under Notification No. 5/99, irrespective of whether it is used as feedstock, as long as it is used for the specified purposes outlined in the notification. The decision was based on a strict interpretation of the language of the law, emphasizing that exemptions cannot be denied based on interpretations that are not explicitly stated in the legal provisions.