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TMI Blog2004 (6) TMI 506X X X X Extracts X X X X X X X X Extracts X X X X ..... o obtain the benefit of two exemptions under Notification No. 217/86-C.E. dated 2nd November 1986 which were mutually exclusive. This was challenged in a writ petition being C.O. 14170 (W) of 1991. The learned Single Judge by a decision dated 2nd December 1991 was pleased to quash this Notification on the ground that even assuming the allegations made in the show cause that there were two products, even then there was no justification of assuming that the assessee was availing the benefit of two Notifications in respect of one product. Inasmuch as, if these are assumed to be two products in that event it would be entitled to exemption in respect of inputs under Notification No. 452/86 and the end-product is entitled to the benefit under Notification No. 217/86. The learned Judge had also found that the exemption under the said two Notifications were granted in exercise of the power conferred under Rule 8(1) of the Central Excise Rules, 1944 whereas the case made out in the show cause notice was admitted to confuse the adjustment available under Rule 57A which is altogether distinct, separate and independent of each other. This decision of the learned Single Judge was reported in 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty is the predominant ingredient for application of adjustment under Rule 57A. It does not deal with the case of exemption altogether. While these Notifications No. 217/86 and 452/86 were issued under Rule 8(1) of the 1944 Rules. In case where such Notifications were issued under two different Rules it may be a question of exercising option with regard to a particular Notification under one or the other Rule. But where the Notification was issued under a particular Rule, there is no question of such option unless it was specifically provided. He relied on the decision in M/s. Hemraj Gordhandas v. H.H. Dave, Assistant Collector of Central Excise and Customs, Surat Ors., 1978 (2) E.L.T. (J 350) (S.C.) to contend that in a taxing statute, there is no assumption for any intendment but regard must be had to the clear meaning of the words. If the tax exemption is within the plain terms of the order/notification etc. the benefit thereof cannot be denied by calling in aid of any supposed intention of the exempting authority. No word can be added to the Notification or statute. He relied on the decision in Union of India v. Tata Iron Steel Co. Ltd., Jamshedpur, 1977 (1) E.L.T. (J 61) (S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic rate of duty vide Notification No. 452/86-C.E., dated 20-11-1986 which denies the input duty relief u/r. 57A. But they have not paid any Central Excise duty on such bodies of wagon (i.e. wagon components parts) fabricated manufactured and captively consumed. (i) The bodies of wagon as fabricated were identifiable (wagon/components parts) as stable wagon to be mounted on bogies classifiable under sub-heading 8607.00 and as per Rules 9 49 duty was attracted on captive consumption; (ii) The Notification No. 217/86-C.E., dated 2-4-1986 and Notification No. 452/86-C.E., dated 20-11-1986 in which concessional rate of duty on finished product is allowed by curtailing the benefit of availment of credit of duty on inputs, are obviously mutually exclusive. Because whereas Notification No. 452/86 denies the credit on inputs, the Notification No. 217/86 materially allows the same thus availing the benefit of both notifications simultaneously frustrates the very purpose of issuing such notifications resulting in loss of Govt. revenue to the tune of Rs. 65,18,719.70 during the period from August 1990 to January 1991. The said assessees are hereby required to show cause to the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28, 29, 30, 32, 33, 34, 35, 36, 37, 38, 39, 40, 70, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95 or 96 (other than those falling under Headings Nos. 36.03 or 37.05) of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986). 6.2. NOTIFICATION No. 452/86-CENTRAL EXCISES 2. In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, the Central Government hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 214/86-Central Excise, dated the 25th March, 1986, namely : In the said notification, in the opening paragraph - (i) The existing Explanation shall be numbered as Explanation I; and (ii) after Explanation I as so numbered, the following Explanation shall be inserted, namely: - Explanation :...... Exemption to specified goods falling under Chapter 86. - In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts the goods of the description specified in column (3) of the Table hereto annexed and falling un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Box Wagon, which is known as stabled wagon is mounted on wheeled bogies. Both are manufactured by the assessee on the basis of the materials particularly steels and other inputs supplied by the Railways. There are occasions when the supply of the materials were delayed. In such case the box wagon cannot be mounted on the bogies and are termed as stabled wagons. During such delay, some advance payments are also obtained by the assessee. The box wagons/stabled wagons were not marketable commodity unless it was used as raw materials by some one else. It has no utility in the market until mounted on the wheeled bogies. These stabled wagons are captively used by the assessee for manufacturing the end-products. Now even if these stabled wagons were taken to be an end-product even then it was being captively used as inputs by the assessee. The end-product that was transferred from the factory of the assessee was the wagon not the stabled wagon. The exemption : 8. Rule 8(1) empowers the Central Government to exempt wholly or in part from payment of excise duty in relation to the inputs described in column (2) of the said Notification if used for the end/final products described in co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt product and chargeable as input, which question we need not go into, even then no duty being leviable under the said Notification issued under Rule 8(1) being altogether independent, separate, distinct and different from the concept of adjustment contemplated under Rule 57A and therefore no payment being made, the question of adjustment was wholly preposterous. Conclusion : 10. Thus, on the face of the impugned show cause notice it appears that it did not disclose even prima facie that there was any substance on the question sought to be raised and that by any stretch of imagination the principle of Rule 57A could at all be attracted in the present facts and circumstances of the case when the scope of Rule 8(1) is completely distinct, different and independent of the field or area where Rule 57A operates. There was no scope of inviting the principle of, enjoying double benefits. Inasmuch as, if it was one end-product, it is entitled to the benefit of the Notification No. 452/86. If it is two products in that event the stabled wagon was liable for exemption under Notification No. 217/86 and the end-product was liable to be charged at the rate specified in Notification No. 452 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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