1989 (2) TMI 195 - AT - Central Excise

Summary

Issues involved:
1. Whether two exemption Notifications issued under Rule 8 of the Central Excise Rules can be availed of simultaneously or only one of them.
2. The correct interpretation of the words "at the rate specified in the said First Schedule" in Notification No. 259/83.

Issue 1:
The appellants manufactured vanaspati products and availed of two exemption Notifications: Notification No. 24/65-CE and Notification No. 259/83. The dispute arose when the department contended that the appellants could not avail of both exemptions concurrently. The Assistant Collector and the Collector (Appeals) held in favor of the department. However, the appellants argued that two notifications can be simultaneously availed of, citing relevant case laws. The Tribunal observed that there was no categorical bar to availing more than one notification unless explicitly stated. Therefore, the appellants were allowed to avail of both Notifications simultaneously.

Issue 2:
Regarding the interpretation of the words in Notification No. 259/83, the question was whether the reduction in duty should be calculated based on the tariff rate or the effective rate after applying the exemption notification. The Tribunal noted that the revenue's proposed construction would lead to a situation where availing of the notification would result in paying a higher rate of duty, contrary to the government's intention to encourage the use of indigenous rice bran oil. Citing a Supreme Court judgment, the Tribunal concluded that the reduction should be calculated with reference to the effective rate of duty, subject to the conditions specified in Notification No. 259/83.

The Tribunal set aside the impugned orders and remanded the matter to the Assistant Collector for re-examination, with directions to allow the appellants to avail of the exemption and calculate the reduction from the effective rate of duty. The purpose of the remand was to verify whether the conditions of Notification No. 259/83 were satisfied. Ultimately, the appeal was allowed by remand.