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TMI Blog1993 (2) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... j.) holding that exemption under this notification is not available to the skimmed milk powder used in the manufacture of other products like ice-cream etc. As against this, the Collector (Appeals) has held that there is no reason to deny the exemption on the ground that regenerated milk is further used in the manufacture of other Prepared or Preserved Foods under Item 1B of erstwhile Central Excise Tariff since there is no stipulation in the notification that such regenerated milk out of skimmed milk powder should be cleared from the factory. When the appeal was heard by the referring Bench, it was brought to its notice by the learned Counsel Shri A.C. Gulati for the respondents that the Andhra Pradesh High Court in the case of The Andhra Pradesh Dairy Development Corporation (Pvt.) Ltd. v. Union of India, reported in 1976 Tax Law Report 1967 has taken different view and this judgment of the Andhra Pradesh High Court had not been noticed by the Gujarat High Court. The learned Counsel also placed before the Bench Order No. 502/89-D dated 24-10-1989 in which a three Member Bench had after considering both the judgments remanded the matter to the Assistant Collector for de novo adjud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Tribunal had rightly followed the Gujarat High Court judgment in its decision in the case of Punjab Dairy Development Corporation Ltd. reported in 1991 (56) E.L.T. 863 (Tri.) = 1991 (18) ETR 17. The learned Counsel for the respondents Shri A.C. Gulati however, contended that the Andhra Pradesh High Court judgment had not been brought to the notice of Gujarat High Court and the Gujarat High Court judgment had not considered the principle that there is no room for intendment in the interpretation of an exemption notification because in coming to its conclusion, the Gujarat High Court had examined the intention behind Notification No. 38/78-C.E. in granting the exemption for skimmed milk powder regenerated into liquid milk. This, according to the learned Counsel was not a sound consideration as has been settled by the decision of the Supreme Court and in this context, the learned Council cited the decision reported in 1978 (2) E.L.T. (J 317) in the case of Assistant Collector of Central Excise and Customs at Surat and Others v. Shri J.C. Shah, M/s. Jayantilal Balubhjai and Others and Shri Mani Shanker Magatram and Others that there is no room for intendment and another Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istant Collector of Central Excise that such skimmed milk powder is intended for use for the regeneration of liquid milk; and (ii) the procedure set out in Chapter X of the Central Excise Rules, 1944 is followed." The decision of the Gujarat High Court in M/s. Vadilal Dairy Frozen Food In- dustries, Ahmedabad case (Supra) relied upon by the Department interprets the very same notification. Para-2 of the judgment which is relevant is reproduced below :- "In the present case the petitioners are manufacturing ice-cream from the skimmed milk powder purchased by them. They claim exemption on the ground that in the course of process me skimmed milk powder used by them has to be liquefied at the intermediary stage. The scheme of exemption as per the notification apparently is to grant it when the metamorphosis from milk-to-skimmed milk-to-liquid milk. Exemption is, however, being claimed by the petitioner when the metamorphosis is from milk-to-ice-cream (after liquefying skimmed powder at an intermediary stage on the premises of the ice-cream manufacturer). There is no need to search for a secret code in order to decipher the underlying purpose of granting exemption. It is manifestl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... generation into liquid milk only. It may in this context be borne in mind that it is well settled principle of interpretation that courts in construing a statute will give weight to the interpretation put upon it at the time of its enactment and since, by those whose duty has been to construe, execute and apply the enactment. [See C.C.E., Guntur v. Andhra Sugar Ltd.-1988 (38) E.L.T. 564 (S.C.) = [1989] 19 ECC 46 (S.C.)]. The Andhra Pradesh High Court decision cited by the respondents in support of the case in the case of Andhra Pradesh Dairy Development Corporationy Ltd. (Supra) was set in a factually different context. The Court was not interpreting any exemption notification of a similar nature as in the present case but was considering the question of excitability under Item 1B CET of milk powder manufactured and stored at the factory in kraft paper bags for purposes of preservation and subsequent regeneration on into fluid milk and had held such goods to be non-excisable. This was a single judge decision rendered in 1975 whereas the Gujarat High Court decision is much later in 1982 rendered by Divisional Bench and, as observed above, on the very exemption notification with whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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