1985 (10) TMI 175 - AT - Central Excise

Summary

Issues:
Interpretation of Notification No. 132/82 and its amendment by Notification No. 193/82 regarding duty exemption on excess sugar production during a specified period.
Applicability of duty reduction under Notification 132/82 to sugar cleared before the amendment by Notification 193/82.
Interpretation of Central Excise Rule 9A in determining the rate of duty for excisable goods.
Validity of retrospective effect of Notification 193/82.
Consideration of Supreme Court judgments in similar cases.

Analysis:
The case involves an appeal by the Collector of Central Excise against an order passed by the Collector of Central Excise (Appeals) regarding duty exemption on excess sugar production during a specified period as per Notification No. 132/82 and its subsequent amendment by Notification No. 193/82. The dispute revolves around the interpretation of these notifications and their applicability to sugar cleared before the amendment date. The key issue is whether the duty reduction under Notification 132/82 applies to sugar cleared prior to the amendment by Notification 193/82.

The Central Government issued Notification No. 132/82 exempting excess sugar production during a specific period from duty, subject to certain conditions. The notification was later amended by Notification No. 193/82, clarifying the eligibility criteria for duty exemption. The respondent, a sugar factory, claimed a rebate based on these notifications for excess sugar production. However, the claim was partially disallowed by the excise authorities based on Trade Notices and the interpretation of the notifications.

The appellant argued that the duty rate applicable is as per the date of clearance of excisable goods, as per Central Excise Rule 9A. They contended that the factory was not eligible for duty reduction under Notification 132/82 before the amendment by Notification 193/82, which was effective from a specific date. Citing Supreme Court judgments, the appellant emphasized that rules cannot have retrospective effect.

On the other hand, the respondent argued that Notification 193/82 did not make substantive changes to Notification 132/82 and merely clarified its intention. They contended that the duty rebate should apply to the entire excess production during the designated period, irrespective of clearance dates. The respondent also highlighted the Tribunal's decision in a similar case to support their argument.

After considering both parties' submissions, the Tribunal held that the duty reduction under Notification 132/82, as amended by Notification 193/82, was not applicable to sugar cleared before the amendment date. The Tribunal emphasized that the duty rate depends on the clearance date, and the factory was not eligible for the benefit before the specific amendment date. Therefore, the appeal was allowed, setting aside the Collector (Appeals) order.

In conclusion, the judgment clarifies the interpretation of the notifications, the application of Central Excise Rule 9A, and the non-retrospective effect of amendments. It underscores the importance of eligibility criteria and clearance dates in determining duty exemptions for excisable goods.