1985 (7) TMI 363 - AT - Central Excise

Summary

Issues involved: Interpretation of central excise duty liability on spindle tapes of width 15 cms. or less under Exemption Notification No. 226/77-C.E.

Summary:

Issue 1: Interpretation of Exemption Notifications
The dispute centered around whether spindle tapes of width 15 cms. or less were subject to central excise duty as per the proviso to Exemption Notification No. 226/77-C.E., dated 15-7-1977. The appellants were absent during the hearing but submitted written arguments. The Department's representative requested a remand to address the appellants' new contention regarding the nature of the duty. It was confirmed that two other exemption Notifications, No. 70/69-C.E. and No. 91/69-C.E., were in force during the relevant period.

Issue 2: Application of Exemption Notifications
Upon careful consideration, it was noted that the two earlier Notifications, No. 70/69-C.E. and No. 91/69-C.E., provided total exemption for cotton fabrics of not more than 15 cms. in width under Item 19 of the Central Excise Tariff. The Exemption Notification No. 226/77-C.E., invoked by the lower authorities, also pertained to cotton fabrics and granted partial exemption from fabric duty. As the spindle tapes in question fell within the scope of the total exemption granted by the earlier Notifications, the denial of this exemption by the authorities was deemed unjustified. It was concluded that one exemption Notification could not negate the benefits conferred by another separate Notification. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellants with consequential relief.