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TMI Blog1988 (4) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... they became eligible for the benefit of exemption for the reason that the aggregate value of their clearances for the purpose of said exemption notifications for the year 1979-80 was only Rs. 10,68,631.62 as even though the value of the life saving drugs manufactured by them were not exempt during 1979-80 but since these had been exempted by virtue of Notification No. 106/80 value of these was required to be excluded from the aggregate value of clearances in the past year i.e., in the year 1979-80. For proper appreciation of the issue, the relevant extract of the Notifications No. 80/80 and 106/80 are reproduced below: In exercise of the powers conferred by sub-rule (l) of Rule 8 of the Central Excise Rules 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 71 /78-Central Excises, dated the 1st March 1978, the Central Government hereby exempts the excisable goods of the description specified in column (3) of the Table hereto annexed (hereinafter referred to as the specified goods"), and falling under such Item Number of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944), as is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en lakhs respectively in terms of clauses (a) and (b) of paragraph 1." Explanation I... II... III... IV... V..." [Notification No. 80/80 dated 19-6-1980] In exercise of the powers conferred by sub-rule (1) of rule 8 of the .Central Excise Rules, 1944, the Central Government hereby directs that each of the notifications of the Government of India in the Ministry of Finance, Department of Revenue and Insurance or of Finance, Department of Revenue and Insurance or Department of Revenue, as the case may be, specified in column (2) of the Table hereto annexed shall be amended or further amended, as the case may be, in the manner specified in the corresponding entry in column (3) of the said Table. THE TABLE S.No. Notification No. and date Amendment 1. 116/69-Central Excise, dated the 3rd May, 1969 In the said notification, for the words and figures from so much of the duty of excise leviable thereon as is in excess of 2-1/2 per cent ad valorem, namely : the words from the whole of the duty of excise leviable there on", shall be substituted." * * * [Notification No. 106/80, dated 19-6- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case such goods were not exempted in the previous year, i.e. in 1979-80 notwithstanding the exemption having been given in 1980 the value of the same was required to be included. He stated that the lower authority did not accede to the appellants plea and the appellants paid the duty under protest and therefore claimed refund for the same. 4. The learned JDR drew our attention to the reasoning given in the Collector (Appeal s order (para 5). He pleaded that as set out in the order the value only of such of these goods should be excluded for the purpose of arriving at the total value of the clearances as were exempt during 1979-80. He pleaded that the benefit of the notification could not be given retrospectively. ( 5. The short question that falls for our consideration is whether the value of the life saving drugs falling under T.I. 14E manufactured by the appellants during 1979-80 could be excluded for the purpose of arriving at the aggregate value of the clearances during 1979-80. For this purpose it is necessary to examine the scope of Notification No. 80/80. The notification provides for commodities which are covered by exemption notification and these have been described ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose of eligibility criteria based on the total clearances of the specified goods. Now this criterion has to be applied in such a manner that a person who was manufacturing specified goods during 1979-80 as also during 1980-81 should stand on the same footing. To interpret this explanation, in any other way, would be making a distinction between those who are already manufacturing the goods and those who already manufactured the goods during 1980-81 such a distinction has to be avoided unless notification specifically calls for such a distinction to be drawn based on some rational criteria. Now in case of a new manufacturer manufacturing patent and proprietory medicines for the first time in 1980-81 who also manufactured life saving medicines, which were exempt under 106/80 the value of the clearances of the life saving medicines would not be taken into reckoning and there is no plea against this. However, so far as the manufacturer like the appellants in the present case is concerned, the revenue seek to interpret the scope of the Explanation V in a manner that the value of clearances of life saving drugs which were not exempt during 1979-80 but only after 19-6-1980 these would hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired for excluding the value of life saving drugs for computing the aggregate value of clearances is to establish that the same were exempt when the benefit of Notification 80/80 was claimed. In the present case we find that in terms of Notification 106/80 it was so. We therefore hold that the value of the clearances of the same was required to be excluded. We therefore allow the appeal with consequential relief. 6. [Per : S.D. Jha, Vice-President, (J)] - I have not been able to persuade myself into agreeing with the order proposed by Brother Gulati and I, therefore, record my views in brief separately. 7. Para 2 of the notification reproduced by Brother Gulati at page 2(1) of his order is clear that it is not to apply to a manufacturer if the aggregate value of clearances of the specified goods, if any, by him or on his behalf for home consumption, from one or more factories, during the preceding financial year had exceeded Rs. 15 lakhs. In the financial year 1979-80, life saving drugs were not wholly exempt from duty of Excise and became exempt only under Notification No. 106/80 dated 19-6-1980 reproduced by Brother Gulati at page 3 of his order. If benefit of Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X
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