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TMI Blog1982 (10) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... r manufactured by it during the period May and June, 1973 at the rates specified in the Schedule to the Central Excises and Salt Act. 2. On 28-9-1972 the Central Government in exercise of its powers under sub-rule (1) of Rule 8 of the Central Excises and Salt Act, issued a notification granting certain exemptions in payment of Excise duty on sugar produced by Sugar Factories as incentive Excise rebate on certain conditions. Acting upon the said notification, the petitioner claimed a sum of Rs. 8,73,870/- at the rate of Rs. 30/- per quintal on the excess quantity of 29129 quintals of sugar produced by it between the period 1st of May, 1973 to 30th June, 1973. The claim made by the petitioner was scrutinised and allowed by the Asstt. Collect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount of Rs. 8,73,870/- had been refunded to it correctly. The demand raised by the Excise Department is, therefore, illegal. (ii) The action taken by the Central Excise Authorities for recovering the refund of Rs. 8,73,870/- is also barred by limitation. (iii) The demand raised by the Excise Authorities stands vitiated inasmuch as the same was raised without affording any opportunity to the petitioner to have his say and in contravention of the principles of natural justice. The prayer made in the petition has been contested on behalf of the respondents who contend that the petitioner was not entitled to any exemption under Notification dated 28-9-1972. The refund of Rs. 8,73,870/- was, therefore, wrongly made and the respondents can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .............................. (c) ............................................. Provided further that in computing the production of sugar during the "periods mentioned in column (2) of the said Table. (a) ............................................... (b) ................................................ (c) ................................................. Explanation I: ........................................................................... ........................................................................... Explanation II: In this notification, the expression, 'base period' means the period commencing from the 1st day of October, 1971 and ending with the 30th day of September, 1972 Sd/- S.R. Narayanan, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder main clause 3 of the notification, the petitioner could be entitled to exemption from payment of Excise duty to the extent indicated therein in respect of sugar produced by it during the months of May and June, 1973 only if it could be shown that it had produced some sugar in excess of the quantity of sugar produced by it during the corresponding period of the year 1972. As in this case, during the months of May and June, 1972 the petitioner admittedly did not produce any sugar, no question of its production in the months of May and June, 1973 being in excess of production in the corresponding months of May and June, 1972 can possibly arise. We are unable to accept this submission. In a case like the present one where the petitioner di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision, the Patna High Court had held that in a case where there was nil production in the corresponding period, the exemption in respect of excess production would not be admissible. The decision of the Patna High Court has been noticed by the Punjab and Haryana High Court as well as by the Andhra Pradesh High Court in the decisions cited above. Both the courts have disagreed with the view of the Patna High Court. We are in respectful agreement with the view expressed by the Andhra Pradesh and Punjab and Haryana High Courts.
8. The petition, therefore, succeeds and is allowed. The demand notice dated 25-1-1978 and the orders dated 10-3-1981 and 2-4-1981 are quashed. Petitioner shall be entitled to costs in this petition. X X X X Extracts X X X X X X X X Extracts X X X X
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