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TMI Blog1991 (11) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, read with sub-clause (4) of clause 50 of the Finance Bill, 1982, which clause has, by virtue of the declaration made in the said bill under the Provisional Collection of Taxes Act, 1931 (16 of 1931), the force of law, the Central Government hereby exempts sugar, described in column (1) of the Table below and falling under sub-item (1) of Item No. 1 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944) from so much of the duty of excise and special duty of excise leviable thereon as is specified in the corresponding entry in columns (2) and (3) of the said Table : TABLE Description of Sugar Duty of excise and special duty of excise Levy Free sale Sugar (1) (2) (3) (Rupees per quintal) Sugar produced in a factory during the period commencing on the 1st day of May, 1982 and ending with the 30th day of September, 1982 which is in excess of the average production of the corresponding period of the preceding three sugar years. 40.00 24.50 Provided that the amount of exemption specified in column (2) or column (3) of the said Table shall not exceed the amount of duty of excise and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hi, the 11th June, 1982 21 Jyaishtha, 1904 (Saka) Notification No. 193/82-Central Excise In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, read with sub-section (4) of section 50 of the Finance Act, 1982 (14 of 1982), 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. 132/82-Central Excises, dated the 21st April, 1982, namely :- In the said notification, - (a) In the preamble, for the words, brackets and figures `sub-clause (4) of Clause 50 of the Finance Bill, 1982, which clause has by virtue of the declaration made in the said Bill under Provisional Collection of Taxes Act, 1931 (16 of 1931), the force of law', the words, brackets and figures `sub-section (4) of Section 50 of the Finance Act, 1982 (14 of 1982)' shall be substituted; (b) for paragraph 4, the following paragraph shall be substituted, namely : - "(4) Where production during May to September in all the preceding three sugar years was nil, the entire production during May to September, 1982 will be entitled to the exemption under this notification." The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two years. That is the sum and substance of the main argument in the instant case. 5. Paragraph 3 of the said notification provides that the average shall be the average of the corresponding periods among the preceding three sugar years in which the factory had actually produced and the periods in which it did not produce during the said three sugar years shall be ignored while arriving at the average. It is the contention of Mr. C. Natarajan that the courts have held that while calculating the average production of sugar during the lean period of the corresponding years, the total production should be divided by 3, irrespective of the fact whether the manufacturer produced sugar in all the three preceding years or in any one of the preceding three years. Learned Counsel for the petitioner further contended that even though the object of the notification is to provide incentive so as to increase production during the lean period, it does not have any nexus for the reasons that the manufacturers were not permitted to plan to produce more sugar during the incentive period by issuing such notification in advance and consequently the manufacturer could not increase the production of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sugar production is not that much as was produced or as is produced during the other period. The very object is to encourage production during the lean period. The manufacturers may not come forward to produce more sugar during the lean period for the avowed reason that the output of the sugar may not be that much economical. It is with the avowed object of increasing the production, an incentive is made by the impugned notification. However, by paragraph 3 the Government had prescribed that if the manufacturer produces more sugar than the average production of sugar during the corresponding lean period of preceding three years, they are entitled to exemption under the excise duty at the rate as specified in the said notification. Further, the Government of India prescribed norms to calculate average production. As per the notification the everage production has to be calculated by dividing the total quantity of the production by the number of years of actual production, i.e., the year in which the manufacturer does not produce should be ignored. That formula is applicable to every manufacturer. Some may be fortuitous and some may be unfortunate persons. That does not mean that pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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