2002 (9) TMI 187 - AT - Central Excise

Summary

Issues:
1. Interpretation of the definition of "meter length" in relation to an embroidery machine under Rule 96ZI(6) of Central Excise Rules, 1944.
2. Applicability of Notification No. 15/98-C.E. (N.T.) dated 2-6-98 on retrospective basis.
3. Validity and applicability of Baroda Collectorate's Trade Notice No 289/69 dated 18-9-69 in the present case.

Analysis:

1. The case involved a dispute regarding the correct interpretation of the term "meter length" in relation to an embroidery machine under Rule 96ZI(6) of the Central Excise Rules, 1944. The Revenue contended that the distance between the points provided for the first and last needles of only one roller of the machine should be considered as the "meter length." The Assistant Commissioner's reliance on a notification amending the definition of "meter length" was challenged by the Revenue, arguing that the notification was issued after the period in question. The Commissioner (Appeals) upheld the Assistant Commissioner's decision, leading to the Revenue filing an appeal.

2. The appellate tribunal examined the applicability of Notification No. 15/98-C.E. (N.T.) dated 2-6-98 on a retrospective basis. The tribunal noted that the amendment to the definition of "meter length" in the notification was clarificatory in nature and was in line with the Budget Proposals of 1998-99. Citing a decision of the Karnataka High Court, the tribunal concluded that the notification should be applied retrospectively. The tribunal also emphasized that the Trade Notice issued by the Baroda Collectorate, which received statutory approval through the clarificatory amendment, should be considered binding and applicable.

3. The tribunal further addressed the validity and applicability of Baroda Collectorate's Trade Notice No 289/69 dated 18-9-69 in the case. It highlighted that such notices are issued based on advice and clarifications from the Central Board of Excise & Customs, making them binding unless contradicted by subsequent instructions. The tribunal emphasized that Revenue cannot disregard instructions issued by the Central Board of Excise & Customs and its own Trade Notices. Consequently, the tribunal found no merit in the Revenue's appeal and dismissed it based on the aforementioned considerations.