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TMI Blog1987 (3) TMI 210X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 15-12-80. He held that it was incorrect to say that they did not fulfil the conditions prescribed in clause 5 of the notification. After setting aside the order of the Superintendent he remanded the matter to the Superintendent to work out the exact amount of rebate admissible and then credit the same to their PLA. The Central Government being of the view that the said order of the Appellate Collector was not legal, proper and correct issued notice dated 5-6-81 under Section 36(2) of the Central Excises and Salt Act. The Central Government pointed out that any factory which was not in existence during all the 3 sugar years preceding the sugar year 1977-78 would not be entitled to benefit under the notification and since the factory of the respondents started working in December, 1976 only and did not therefore produce any sugar during whole of sugar years 1974-75, 1975-76 the same was not entitled to the benefit under the notification. The notice further pointed out that the factory would be barred from availing benefit under Notification No. 108/78 by reason of clause 6 thereto. The Central Government thus being tentatively of the view that the order of the Appellate Collecto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claim papers are returned herewith. It was evidently following the said instructions that the show cause notice dated 15-5-79 had been issued by the Superintendent to the respondents. It is curious that though. the Superintendent mentioned in the said notice that the factory did not fulfil the conditions of clause 5 of the notification he did not choose to explain why they did not fulfil the said condition. Clause 5 of the notification reads as follows : 5. Notwithstanding anything contained in this notification, a factory whose overall production of sugar during the 1977-78 sugar year does not exceed the average production of the preceding three sugar years shall not be entitled to any exemption of duty of excise under this notification. Where production in any of the preceding three years was nil, the average production shall be determined as under :- The average production shall be worked out on the basis of the sugar year or years in which the factory had actually worked and the sugar year of years in which it did not work during the preceding three sugar years shall be ignored while arriving at the average." 4. It may be noted that this clause 5 does not in terms co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts only to show that the initial order of the Superintendent would have been liable to be set aside on the very ground that it was not an order passed by the Superintendent functioning as a quasi-judicial authority after bestowing his mind to the problem but had been passed merely under instructions of superiors without giving any reasons for his conclusion. 7. The Appellate Collector had held in his order that clause 3 of the notification provided that in determining the average production during the period May-September during the preceding three sugar years the period in which the factory did not work should be ignored and that there were similar provisions in clause 5 also. He held that the years during which there had been no production on the part of the respondents had to be therefore ignored in accordance with the said provisions in working out the average production and therefore respondents were not disentitled to the rebate claimed, subject to proper quantification thereof by the Superintendent. In seeking to set aside the said order the Government have mentioned in their review notice that under the terms of the notification no factory would be entitled to the reb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on sought to be placed on the notification by the petitioner is not correct. When the notification speaks of production being nil in the previous 3 years it contemplates existence of a factory which did not produce. It does not mean that whether the factory was not in existence and so there was no production the exemption would be attracted. Dismissed . Thus while the respondents rely on the judgment of the Bombay High Court the Department relies on the judgment of the Delhi High Court. We may point out that in several earlier decisions this Tribunal had followed the judgment of the Bombay High Court, the judgment of the Delhi High Court not having been cited during those proceedings. The first paragraph of clause 5 of the notification contains a stipulation as to which factory would be excluded from claiming benefit under the notification. It is stipulated thereunder that where the overall production of sugar during the 1977-78 sugar year did not exceed the average production of the preceding three sugar years the factory would not be entitled to benefit. It is significant that there is no such similar express provision to deny eligibility under the notification for a factory whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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