9911796707
TMI Blog1988 (10) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred to as the appellants) are manufacturers of Organic Chemicals falling under Heading Nos. 29.12 and 29.15 of the Central Excise Tariff Schedule, 1985. Duty paid molasses is used in the course of manufacture of the final products (Acetaldehyde, Acetic Acid, Acetic Anhydride, and Vinyl Acetate Monomer) as one of the raw materials. Ethyl alcohol emerges as an intermediate product in the course of such manufacture. Ethyl alcohol is not a substance on which Central Excise duty is leviable, it being out of the purview of the Central Excise duties. The scheme of credit of duty paid on inputs towards payment of the duty leviable on final products, as notified by the Government of India in Central Excise Notification No. 176/86, dated 1-3-1986 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to nil rate of duty.: Provided that such intermediate products are used within the factory of production in the manufacture of final product on which the duty of excise is leviable whether in whole or in part." 6. While Shri Dave s contention is that credit of input duty cannot be denied on the ground that the intermediate product, ethyl alcohol, is not leviable at all with Central Excise duty, Shri Sunder Rajan s contention is that ethyl alcohol, not being leviable with Central Excise duty at all, cannot be said to be an intermediate product which for the time being is exempt from the whole of the duty of excise leviable thereon or chargeable to nil rate of duty . 7. The object of the scheme in Notification No. 176/86-CE, dated 1- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and can therefore be referable only to duty of Central Excise. But that, however, does not dispose of the dispute before us. The question still remains whether, even though ethyl alcohol, the intermediate product, is not leviable with duty of Central Excise, the appellants are entitled to, or debarred from, availing themselves of the credit of duty already paid on the input molasses. In our view, having regard to the object of the scheme, the rule should be construed in such a manner as to further that object and not hamper it. Viewed from this angle, sub-rule (2) of Rule 57D should be read to mean not only that credit of input duty shall not be denied or varied in cases where excisable intermediate products emerge but are for the time be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7-CE, dated 1-3-1987 inserting Rule 57K in the Central Excise Rules read with Notification No. 231/87-CE, dated 1-10-1987, ethyl alcohol came to be specified as an input for the manufacture of specified final products, in the context of price notified for ethyl alcohol under the order of the Government of India in the Ministry of Industry (Department of Chemicals and Petrochemicals) No. 15021/6/87-Ch. II Desk, dated the 29th September, 1987 and the price paid for molasses as notified under the order of the Government of India in the Ministry of Industry (Department of Chemicals and Petro-Chemicals) No. 15021/29/87-Ch. II Desk, dated the 25th September, 1987. Notification No. 231/87 sets out the rate of Rs. 258 per kilolitre of ethyl alcohol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion to the plainness of the language. To avoid patent injustice, anomaly or absurdity or to avoid invalidation of law, the Court would be well justified in departing from the socalled golden rule of construction so as to give effect to the object and purpose of the enactment by supplementing the written word if necessary. Viewed in the above light, it would be anomalous to hold that input duty relief would be available only in cases where the intermediate products are leviable with Central Excise duty even though, in reality, they may be exempt from such duty by means of a Rule 8(1) notification or may, in terms of the tariff schedule, be liable to nil rate of duty and not in cases where the intermediate products are not at all leviab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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