Full Judgment
2. Prior to 16-3-1995 the components of the electric generating sets were not covered by the scheme of credit of duty paid on capital goods used by the manufacturer of specified goods under Rule 57Q of the Rules; and 3. The Gear Box in question was received in the factory before 16-3-1995 and by virtue of the specific provision made in Notification No. 11/95-C.E. (N.T.), dated 16-3-1995, no such credit was admissible if the goods had been received in the factory before 16-3-1995.
3. In reply, Shri Alok Arora, Advocate, referred to the Tribunal's decision in the case of J.K. Synthetics Ltd. v. CCE, Jaipur -1996 (88) E.L.T. 785 (Tribunal), wherein the Tribunal had held that newly substituted explanation to Rule 57Q was clarificatory in nature and was thus applicable retrospectively. He also referred to some other decisions of the Tribunal that such an amendment has to be retrospective effect. In rejoinder, the DR referred to the Supreme Court decision in the case of Bombay Oil Indus. Pvt. Ltd. v. U.O.I.-1995 (77) E.L.T. 32 (S.C.), wherein the Supreme Court had held that the amending notification was not to be treatable as clarificatory so as to have retrospective effect. He referred to Para 10 of the judgment of the Apex Court.
4. I have carefully considered the matter. The matter relates to the period September, 1994 when the Gear Box was received by the respondents, M/s. Muzaffar Nagar Steel Ltd. and credit under Rule 57Q was taken. The relevant invoice is dated 8-9-1994 and the credit had been taken on 9-9-1994. A show cause notice was issued on 24-12-1994 disallowing the credit of Rs 26,000/- on the ground that the goods received i.e. Gear Box was not covered by the scheme of credit under Rule 57Q of the Central Excise Rules, 1944.
5. I find that prior to 16-3-1995 i.e. when the goods were brought into the factory, the capital goods for the purposes of Rule 57Q have been defined as under : (a) machines, machinery, plant, equipment, apparatus, tools or appliances used for producing or processing of any goods or for bringing about any change in any substance for the manufacture of final products; (b) components, spare parts/and accessories of the aforesaid machines, machinery, plant, equipment, apparatus, tools or appliances used for aforesaid purpose; and (c) moulds and dies, generating sets and weigh-bridges used in the factory of the manufacturer.
The expression used in the definition is "means." When the expression used is "means", then it is specific and categorical and the scope could not be extended beyond the scope of the definition. It has been provided that only generating sets were covered by the scope of the scheme. I find that the parts of the generating sets were not so covered. With regard to the machines, machinery, plant, etc. as given in the first part of the definition, their components as also parts and accessories have been specifically covered by the second part of the clause of the definition.
6. The goods were received in September, 1994 and the show cause notice was issued in December, 1994.
7. The learned Advocate had referred to the amendment made by Notification No. 11/95-C.E. (N.T.), dated 16-3-1995 in which an amendment had been made among other rules in Rule 57Q. I find that under Notification No. 11/95-C.E. (N.T.), dated 16-3-1995, the Central Government had made the rules under Section 37 of the Central Excises and Salt Act, 1944, further to amend the Central Excise Rules, 1944, it was ordered that these rules shall come into force on the date of their publication in the Official Gazette except that the Rules 15 & 16 shall come into force on the 1st day of May, 1995. Under this amending notification, a number of changes had been made in Rule 57Q including certain amendments in Sub-rule (1) and in the explanation in clause 1.
It was so ordered that after clause (c) and the entries relating thereto, the sub-clauses (d) & (e) shall be inserted. Further, I find that Sub-rule (2) was substituted.
8. Sub-rule (2) as substituted under Notification No. 11/95-C.E. (N.T.) read as under : "(2) Notwithstanding anything contained in Sub-rule (1) no credit of specified duty paid on capital goods (other than those capital goods in respect of which credit of duty was allowable under any other rule or notification prior to the 16th day of March, 1995) shall be allowed if such capital goods were received in the facotory before the 16th day of March, 1995." I find that gear box was not a capital goods for the purposes of Rule 57Q of the Rules prior to 16-3-1995. As such no credit of the duty was allowable in respect of the gear box prior to 16-3-1995. There is no dispute that the goods in question were received in the factory in September, 1994 and the show cause notice had also been issued much before the amending Notification No. 11/95-C.E. (N.T.), dated 16-3-1995.
9. The learned Advocate had referred to the Tribunal's decision in the case of J.K. Syntlietics Ltd., supra. The learned Advocate agreed that this explanation had not been dealt with in the Tribunal's order.
10. Other decisions also referred to by the learned Advocate do not deal with this situation whether that when the capital goods were brought into the factory prior to 16-5-1995 and when such capital goods were not eligible for the credit under Rule 57Q, they will be so eligible under the unamended provisions.
11. Taking all the relevant facts and considerations into account, I do not agree with the view taken by the learned Commissioner of Central Excise (Appeals) in this case. As a result, I allow the appeal filed by the Revenue.