1988 (12) TMI 210 - AT - Central Excise

Summary

Issues:
- Interpretation of notification No. 6/80 regarding the entitlement of polystyrene manufactured from imported raw materials to exemption benefits.
- Comparison of provisions of notification No. 6/80 with other notifications.
- Relevance of the phrase "if leviable" in the notification.
- Application of legal principles in interpreting tax notifications.

Analysis:

The case involved an appeal arising from a Collector's review of an order passed by the Assistant Collector under Section 35-A (2) of the Central Excises and Salt Act, 1944. The dispute centered around the entitlement of polystyrene manufactured from imported raw materials to exemption benefits under notification No. 6/80. The Assistant Collector had initially allowed the benefit, but the Collector reversed this decision, ordering the payment of differential duty on polystyrene manufactured from imported styrene, leading to the appeal.

The main issue for decision was whether polystyrene manufactured from imported raw materials could avail the benefit of exemption under notification No. 6/80. The Assistant Collector had held that such polystyrene was entitled to the benefit, while the Collector disagreed. The arguments primarily revolved around the interpretation of the notification and the significance of the phrase "if leviable."

The appellants' counsel argued that the Collector erred in comparing notification No. 6/80 with other provisions and emphasized the importance of interpreting the notification based on its clear language. Reference was made to legal judgments to support the argument that the intention of the legislature should be derived from the notification itself without adding or subtracting any words.

On the other hand, the Respondent's representative contended that the phrase "if leviable" in the notification was crucial and indicated that Central Excise duty must have been paid for the benefit to apply. The Respondent relied on a Bombay High Court judgment and argued that the intention behind the notification was clear - benefit only if Central Excise duty was paid.

The Tribunal analyzed the arguments presented and the relevant legal principles. It emphasized the need to interpret the notification as it is without ignoring any words or searching for legislative intent beyond the text. The Tribunal highlighted the Supreme Court's stance on interpreting taxing statutes and notifications based on their explicit language, without speculating on legislative intent.

Ultimately, the Tribunal found in favor of the appellants, allowing the appeal. It concluded that since Central Excise duty was not leviable on the imported styrene, the appellants were entitled to the concession granted by notification No. 6/80 as the conditions specified in the notification were met. The Tribunal's decision was based on a strict interpretation of the notification's language and the absence of Central Excise duty on the imported raw materials.

In summary, the judgment focused on the strict interpretation of the tax notification, emphasizing the importance of the notification's wording and rejecting the need to infer legislative intent beyond the explicit language used. The decision clarified the entitlement of polystyrene manufactured from imported raw materials to exemption benefits under notification No. 6/80 based on the specific conditions outlined in the notification itself.