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Issues:
1. Repeal of Rule 10 of the Central Excise Rules, 1944 and its impact on ongoing proceedings. 2. Applicability of Section 6 of the General Clauses Act, 1897 in the context of rule repeal. Analysis: The judgment by the High Court of Judicature at Bombay, delivered by M.L. Pendse and E.D.D.S. Da Silva, JJ., addresses the controversy surrounding the repeal of Rule 10 of the Central Excise Rules, 1944, and its effect on ongoing legal proceedings. The petitioners argued that the demand notice issued under Rule 10 on October 16, 1980, for a duty amount was no longer valid following the repeal of Rule 10 on November 17, 1980. They contended that the proceedings initiated under Rule 10 could not be sustained after its deletion. The petitioners relied on the Gujarat High Court's decision in Amit Processors Pvt. Ltd. v. U.O.I. [1985 (21) E.L.T. 24] to support their argument. However, the High Court rejected this view, citing Section 6 of the General Clauses Act, 1897, which states that the repeal of a regulation does not affect ongoing legal proceedings unless a different intention appears. The court emphasized that Section 6 applies to rules made under a Central Act and that the repeal of Rule 10 was accompanied by the insertion of an identical provision under Section 11A of the Act, ensuring continuity of legal proceedings despite the rule's repeal. The court further discussed the definition of "rule" under Section 3(51) of the General Clauses Act, which includes regulations made as rules under any enactment. By considering the legislative intent and the continuity of legal proceedings, the court concluded that Section 6 of the General Clauses Act applied in this case. The judgment highlighted that the repeal of Rule 10 did not invalidate the demand notice issued under it, as the identical provision under Section 11A of the Act ensured the legal validity of the proceedings. Consequently, the court dismissed the petition, ruling in favor of the continuity of the legal proceedings despite the repeal of Rule 10. In conclusion, the High Court's judgment clarifies the application of Section 6 of the General Clauses Act in maintaining the validity of legal proceedings following the repeal of a rule under a Central Act. The court's analysis underscores the legislative framework's intent to ensure the seamless continuation of legal actions despite changes in specific rules, emphasizing the importance of legal continuity and adherence to statutory provisions in such circumstances.
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