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Issues:
1. Interpretation of Notification No. 88 of 1984 regarding excise duty exemption on tyres. 2. Jurisdiction of the Director General to cancel the exemption certificate. 3. Violation of principles of natural justice in the cancellation of the certificate. Analysis: The case involved a dispute regarding the exemption of excise duty on tyres manufactured by a company. The company had applied for and received a certificate from the Director General of Technical Development, making them eligible for the exemption. However, a communication from the Director General raised issues about the value of the capital investment on plant and machinery, leading to a threat of cancellation of the certificate. The company argued that it did not have sufficient opportunity to provide the required information, claiming a violation of natural justice. The single Judge agreed with the company, stating that the cancellation of the certificate was unjust. The Department proposed to give the company another chance to explain, but the Judge did not find this proposal acceptable. The High Court, in its judgment, noted that the Department's willingness to provide a fresh opportunity was fair. It directed the company to file objections before the Director General and for the Director General to conduct a hearing and pass a detailed order. The company was instructed to raise all permissible contentions during this process and was barred from claiming any benefits until a final decision was made by the Director General. Ultimately, the appeal was allowed, setting aside the previous judgment and directing the company to file objections by the end of December 1995. The Director General was mandated to conduct a hearing and make a decision without making any recoveries based on the cancellation before the new order. It was emphasized that any findings by the single Judge should not influence the Director General's decision. No costs were awarded in the case.
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