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TMI Blog1983 (4) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... hemical is eligible to excise duty under tariff Item No. 68 of the Central Excises and Salt Act, 1944 (Central Act 1 of 1944). 2. In exercise of the powers conferred on it by sub-rule (1) of rule 8 of the Central Excise Rules, 1944 (hereinafter referred to as the Rules) the Government of India in its Notification No. 62/78-C.E., dated 1st March, 1978 (annexure B), has exempted all drugs, medicines, pharmaceuticals and drug intermediates not elsewhere specified from payment of excise duty under the Act. Ever since then, acetic anhydride manufactured by the petitioner and supplied to the drug manufacturers as a drug intermediate had been treated by the excise authorities as exempted from payment of excise duty under the Act. 3. Notwithsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by Government, on 14th September, 1981 in the case of M/s. Hindustan Organic Chemicals Ltd. (Annexure H) reiterated in a later decision rendered on 10-9-1981 in the case of Shasum Chemicals (Madras) Pvt. Ltd. since reported in 1982 E.L.T. 796 (G.O.I.) and the demands made by the Superintendent in the show cause notices is without jurisdiction and illegal. 6. Sri K. Shivashankar Bhat, learned Senior Standing Counsel appearing for the Revenue in justifying the notices, urged that it was open to the petitioner to appear before the Superintendent and urge the very contentions in this petition and such other contentions as are available to it before him who is bound to examine and decide them and then work out, its remedies under the Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emption from payment of excise duty under the Notification dated 1-3-1978. 11. Under the Notification dated 1-3-1978 all drugs, medicines, pharmaceuticals and drug intermediates not elsewhere specified are exempted from payment of excise duty under the Act. An article though a chemical, when supplied as a drug intermediate, is exempted from payment of excise duty. The fact that the chemical is a chemical is not relevant to decide the claim of the manufacturer for exemption if that chemical is supplied as a drug intermediate to the drug manufacturers. 12. The fact that Acetic Anhydride manufactured by the petitioner is sold as a drug intermediate to drug manufacturer is not disputed by the respondents. Even otherwise, the evidence place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch Institute, Lucknow, certifying that Aniline, Para Nitro Chloro Benzene and Acetenilide find vide application as intermediate for drug among other things. The National Chemical Laboratory, Pune have certified that the above mentioned chemicals are drug intermediates to the extent they are used in the manufacture of drugs. Government accordingly set the order in appeal and hold that the petitioners should get the benefit of the exemption notification for the three items to the extent that they are actually used in the manufacture of drugs. In the Government's view, this requirement of end-use though not built into the exemption notification is not only implied but also becomes imperative in a situation where the produce has uses other than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... temporary authority, though it must give way where the language of the statute is plain and unambiguous. This rule has been succinctly and felicitously expressed in Crawford on Statutory Construction (1940 ed) where it is stated in para 219 that 'administrative construction {i.e., contemporaneous construction placed by administrative or executive officers charged with executing a statute) generally should be clearly wrong before it is overturned; such a construction, commonly referred to as practical construction, although non-controlling, is nevertheless entitled to considerable weight, it is highly persuasive'. The validity of this rule was also recognised in Baleshwar Bagarti v. Bhagirathi Dass (1908 I.L.R. 35 Cal. 701) where Mookerjee, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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