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TMI Blog2010 (9) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... on under the Notification No.175/86. The classification list was provisionally approved in the month of November 1989. On 2nd March, 1990 a show cause notice was issued purporting to deny the benefit of Notification No.175/86 as amended by Notification No.174/89 for want of compliance of conditions stipulated in proviso to para-4( b) of the amended notification since it had commenced 3 wp-692.91 production for the first time in the month of June, 1989 and that it had not availed of the exemption under Notification No.175/86 during the financial year 1986-87 as required. The petitioners, on 31st March, 1990, filed their reply (ExhibitF) (page 31) to the show cause notice. Written submissions were subsequently filed on 8th May, 1990 (ExhibitG) (page 34). The Assistant Commissioner, vide his order dated 14th December, 1990, held that in view of the proviso to para-4( b) of the amended notification, the petitioners were not entitled to the benefit of the notification as they had not availed the benefit under the unamended subject notification in the year 1986-87. 3. Not satisfied with the above order and the interpretation put on the Notification No.175/86, the petitioners have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this notification shall apply if the aggregate value of clearances of all excisable goods for home consumption, (a) by a manufacturer, from one or more factories, or (b) from any factory, by one or more manufacturers, had exceeded rupees one hundred and fifty lakhs in the preceding financial year. 4. The Exemption contained in this notification shall be applicable only to a factory which is an undertaking registered with the Director of Industries in any State or the Development Commissioner (Small Scale Industries) as a small scale industry under the provision of the Industries (Development & Regulation) Act, 1951: Provided that nothing contained in this paragraphs shall be applicable (a) in a case where the value of clearance from a factory during the preceding financial year or the current financial year did not exceed or is not likely to exceed rupees seven and a half lakhs or (b) in a case where manufacturer who is manufacturing specified goods in a factory, other than a factory which is registered under the Industries (Development & Regulation) Act, 1951 with the Directorate General of Technical Development in the Ministry of Industry and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Table annexed to the notification of the Government of India in the Ministry of Finance (Department of Revenue) No.53/88Central Excises, dated the 1st March, 1988." 7. The aforesaid clause was further amended by another notification bearing No.174/89C. E., dated 1st September, 1989 whereby after the proviso in paragraph4, the following proviso was inserted: " Provided further that nothing contained in clause (b) of the 1st proviso shall apply in a case where a manufacturer who is manufacturing specified goods in a factory and is registered under the Industries (Development and Regulation) Act, 1951 (65 of 1951), with the Directorate General of Technical Development, and has availed of the exemption under this notification during the financial year 1986-87 and the aggregate value of clearances of all excisable goods during the financial years 1987-88 and 1988-89 did not exceed rupees one hundred and fifty lakhs" The validity of the aforesaid clause is a subject matter of challenge in this petition. Rival Submissions : 8. Mr.Shroff, learned senior counsel for the petitioners submits that Notification No.175/86 was issued on 1st March, 1986. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 74/89 dated 1st September 1989 and the words "or the exemption in terms of S. No. 39 of the Table annexed to the notification of the Government Of India in the Ministry of Finance (Dept of Revenue) No. 53/88 central excise, dated 1st of March 1988" occurring therein were omitted; and following proviso after clause (b) of para-4 was added: "Provided further that nothing contained in clause (b) of the 1st proviso shall apply in a case where a manufacturer who is manufacturing specified goods in a factory and is registered under the Industries (Development and Regulation) Act, 1951 (65 of 1951), with the Directorate General of Technical Development and has availed of the exemption under this notification during the financial year 1986-87 and the aggregate value of clearances of all excisable goods during the financial year 1987-88 and 1988-89 did not exceed rupees one hundred and fifty lakhs". (emphasis supplied) 10. Mr.Shroff submits that according to Revenue by virtue of the word "and", appearing in the added proviso a unit which was registered with the Directorate General of Technical Development (DGTD) availing the benefit of the notification in the financial year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame specified goods. One unit would be entitled to the benefit of the notification only because it had availed of the benefit in the year 1986-87 whilst another unit like the petitioners' which came into existence only in June, 1989 would not be entitled to the benefit of the notification No.175/86 since it did not avail benefits of the said notification. In his submission, one cannot expect any unit or factory to avail benefits of any notification muchless Notification No. 175/86 prior to its birth or establishment. 13. Mr.Shroff submits that it is now well settled that the subordinate legislation, a notification can be read down in a manner which would uphold the vires of the notification. In his submission, if the conditions in the proviso to sub-clause (b) are read disjunctively, i.e., the word "and" is read as "or" the object sought to be achieved by notification could be fulfilled, i.e., giving the benefit of this notification even to unit that are registered with the DGTD provided it was manufacturing the specified goods and was in the small scale sector. Thus, if the amended notification is purposefully interpreted so as to give effect to the object of the notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the DGTD. In other words, the units, which were registered with DGTD, had no occasion to avail the benefits of Notification No.175/86 prior to 1st September, 1989 i.e. during the financial year 1986-87. On this canvas, the literal meaning sought to be assigned by the Revenue to the amended part of the notification has an effect of producing an unintelligible or absurd result defeating the very purpose of the amendment to the subject notification with effect from 1st September, 1989, whereunder the DGTD registered units were also made eligible to avail of the benefits of the subject notification. In the circumstances, the interpretation given by the Revenue in reading two conjunctive conditions into the amended proviso, namely; that the unit should be registered with the DGTD and that it should have availed the exemption during the financial year 1986-87 destroys the very object of the notification and/or the intention of Government. The condition which was not capable of compliance cannot be read in the amended part of the notification. 19. The Government undoubtedly has the power to impose conditions for the purposes of extending benefits under a notification. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be construed as being withing its proper...." Keeping the above principle of reading down in mind, the word "and" in the amended proviso if read as "or" then some meaning could be assigned to the notification and it can be saved from the vice of Article 14 of the Constitution of India. Reading the word "and" as "or" does not produce any grammatical distortion rather it will give effect to the clear intention of the Government. On the contrary, reading word "and" as "and" would make no sense and result in an unintelligible and absurd result. 22. It is needless to mention that the word `or' and the word `and' are often used interchangeably. There are occasions when the Court, through construction, may change one to the other. This cannot be done, if the meaning of the statute is clear. A departure from natural and plain meaning of the word `and' can be made whenever context justifies it or makes it necessary so do; but the departure ought not to be made, except for good and sufficient reason. 23. In section 7 of the Official Secrets Act, 1920, which reads: "Any person who attempts to commit any offence under the principal Act or this Act, or solicits or incite ..... X X X X Extracts X X X X X X X X Extracts X X X X
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