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TMI Blog1998 (2) TMI 221X X X X Extracts X X X X X X X X Extracts X X X X ..... m during the period Feburary, 1986 to March, 1986, to June, 1986 and July, 1986 on Auto Tyres on the ground that they being a new manufacturer of moped tyres, were entitled to exemption from 50% of the duty as provided under Notification No. 231/85, dated 11-11-1985 since their clearances during the preceding financial year were of less than Rs. 50 lakhs. The respondents were issued a show cause notice in de novo adjudication asking them to explain why their claims should not be rejected on the grounds that in para 2 3 of Notification No. 231/85, dated 11-11-1985, the expression `said goods referred to all tyres, tubes and flaps falling under erstwhile Tariff Item 16 of the old CETA, 1985 Notification No. 231/85, dated 11-11-1985. The su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting nil rate of duty were not liable to be included for the purpose of Notification 231/85. 4. It was also his submission that Explanation-I to Notification No. 231/85-C.E. which provided for exclusion of cycle tyres and tubes attracting nil rate of duty for the purpose of computing the ceiling of Rs. 2 crores under the Notification No. 231/85, was inserted only by Notification 42/89 which came into operation with effect from 1-3-1989. Thus, it is clear that the benefit of this Explanation was available only for the prospective period i.e. with effect from 1-4-1989 onwards and was not available to clearances effected during November December, 1985. The order-in-appeal has provided retrospective benefit of a statutory notification which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccording to them, the words `said goods cannot said to include these categories of tyres and tubes which are either exempted from whole of the duty of excise or charged to nil rate of duty. It was their contention that the value of such goods was within the prescribed limit of 2 crores and the order of the Collector (Appeals) may be upheld. 7. We have considered the above submissions. We observe that the language of the notification is important and there are several conditions which are required to be satisfied. For better appreciation, the Notification 231/85-C.E., dated 11-11-1985 is reproduced below : In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, and in supersession of the notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 40, for home consumption, by him or on his behalf, from one or more factories, during the preceding financial year, had exceeded rupees two crores; (ii) if the aggregate value of clearances of the tyres, tubes and flaps, falling under the said Chapter 40, from any factory, for home consumption, by or on behalf of one or more manufacturers during the preceding financial year, had exceeded rupees two crores : 2. Where a manufacturer has not cleared the said goods in the preceding financial year or has cleared the said goods for the first time on or after the first day of August in the preceding financial year, the exemption contained in this notification shall be applicable to such manufacturer if he makes a declaration with the Assista ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isable goods, whether dutiable or exempted, are required to be taken into account particularly in view of a specific mention of other exemption notifications and the explicit requirement to take them into account. 10. In view of the above clear position which is evident ex facie, the case law cited by the learned Counsel does not advance their cause and the cases are even otherwise distinguishable. 11. Learned DR s contentions have, therefore, strong force. He has rightly pointed out that Notification No. 42/89, dated 1-3-1989 being a fresh notification, was prospective in character and therefore, the benefit of the explanation was available only with prospective effect and was not available to clearances of the preceding period (Novemb ..... X X X X Extracts X X X X X X X X Extracts X X X X
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