1997 (5) TMI 133 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notification No. 135/83 C.E. regarding the calculation of average sugar production.
2. Applicability of previous Tribunal decisions and High Court judgments in determining the average production period for sugar rebate claims.

Issue 1: Interpretation of Notification No. 135/83 C.E.:
The appeal involved a dispute over the calculation of average sugar production for a rebate claim. The respondents claimed a refund for excess sugar production during a specific period, which was contested by the department. The Assistant Collector rejected the rebate claim, arguing that the average should be based on one year only, not three years as calculated by the respondents. The Collector (Appeals) accepted the party's contention, relying on a Tribunal decision in a similar case. However, the department challenged this decision, claiming that the Tribunal's previous ruling did not apply to the current case. The issue centered on whether the average production should consider all three preceding sugar years or only one.

Issue 2: Applicability of Previous Tribunal Decisions and High Court Judgments:
The department argued that a Tribunal decision in a different case (Collector of Central Excise, Aurangabad v. Vasant SSK Ltd.) supported their position that the rebate was not admissible due to lower sugar production during the relevant period. Conversely, the respondents relied on a Bombay High Court judgment (M/s. Balasaheb Desai SSK Ltd.) to support their claim that the average production should be calculated over three years, regardless of past production levels. The Tribunal examined these arguments and determined that the wording of Notification No. 135/83 C.E. clearly indicated that the average production should be based on the period during which the factory operated, not on a three-year calculation. The Tribunal distinguished the High Court judgment as applicable to different notifications and upheld the department's appeal based on the specific wording of the notification.

In conclusion, the Tribunal ruled in favor of the revenue department, allowing the appeal and rejecting the respondents' claim for a refund based on the interpretation of Notification No. 135/83 C.E. The decision emphasized the importance of interpreting the specific language of the notification to determine the period for calculating average sugar production, in line with previous Tribunal decisions and the relevant legal principles.