1. The Assistant Collector (Technical) of the office of the Collector of Central Excise Baroda has filed this appeal under Section 35B of the Central Excises and Salt Act, 1944, against the order No.V-2(19)1172/82 dated 22-6-1982 of the Appellate Collector of Central Excise, Bombay. The Collector of Central Excise of Baroda has authorised the Assistant Collector concerned to file this appeal. The respondent in the appeal M/s. New Shorrock Mills, Nadiad have filed a cross objection in this case also. Therefore, both the appeals and cross-objections are being considered and decided simultaneously.
2. The main point taken up in the appeal by the Assistant Collector of Central Excise is that Notification No. 7/78 dated 17-1-1978 which added Explanation III to Notification No. 226/77, dated 15-7-1977 should have the effect from the date of the issue and not retrospectively. The effect of the Notification No. 7/78, dated 17-1-1978 was that it permitted the department to calculate the average count of yarn in the cotton fabrics were yarns of different counts had been used as warp and weft in the manufacture of the fabrics. The Appellate Collector of Central Excise, Bombay while allowing the appeals of the respondents had held that this Notification No. 7/78, dated 17-1-1978 was clarificatory in nature and therefore the past cases should also be governed by the same. The reasons for the Appellate Collector in making the aforesaid observation was that this notification added an explanation to Notification No. 226/77, dated 15-7-1977. The Appellate Collector inter alia, therefore, decided that the provisions of Notification No. 7/78, dated 17-1-1978 were also available in determining the average count of such fabrics manufactured earlier. This finding has not been acceptable to the Collector of Central Excise, Baroda and therefore he has authorised Assistant Collector to file the appeal. Therefore, the short point to decide in the appeal is whether the Notification No. 7/78, dated 17-1-1978 has retrospective effect or not.
3. The departmental representative on behalf of the appellants has argued that the notification does not have retrospective effect and therefore the order of the Appellate Collector of Central Excise is wrong and that it should be set aside.
4. Consultant Shri M.J. Trivedi for M/s. New Shorrock has pointed out that the description of Tariff Item No. 19 was amended retrospectively by the Central Excises and Salt Act and Additional Duties of Excise (Amendment) Ordinance 1979 and this Ordinance was converted into the Central Excises and Salt and Additional Duties of Excise (Amendment) Act, 1980 (No. 6 of 1980) dated 12-2-1980. As per the Ordinance and the Act retrospective effect was given to the amendment carried out in Item 19 definition of manufacture in Section 2(f) and also to the notification issued thereunder. It is important to observe that the phraseology of the Act No. 6 of 1980 was identical to the phraseology of the Finance Bill, 1982 which also give retrospective effect to Section 4 and to amendments to Rules 9 and 49. However, in particular, Shri Trivedi pointed out Sub-section (2) of Section 5 of the Central Excises and Salt and Additional Duties of Excise (Amendment) Act, 1980 which gives retrospective effect to any rule, notification etc. issued under any Central Excise Act. As per the aforesaid provisions of law, Shri Trivedi pointed out that Notification No. 7/78 dated 17-1-1978 has been given retrospective effect and the count of the yarn in the fabrics has to be determined in accordance with the notification for the cases covered by the appeal. In view of this submission, the Appellate Collector's order is correct though this petition of law is not brought out pointedly in his order. Shri Trivedi, further, argued that Notification No. 7/78, dated 17-1-1978 is declaratory in character and it should have retrospective effect for this reason also. In support of his contention he has relied on G.P. Singh's Principles of Statutory Interpretations Pages 290, 291 including the Supreme Court's decision A.I.R. 1960 SC Page 12 mentioned therein, in view of the foregoing facts, he submitted that the appeal filed under instructions from the Collector of Central Excise Baroda be dismissed.
5. We have examined the submissions on both the sides in the appeal and the cross objections. Normally, the notifications have the effect from the date of the issue as contended on behalf of the Collector of Central Excise Baroda. But in the present case, there are peculiar circumstances for which we are in agreement with the arguments submitted by the learned Consultant Shri Trivedi. The peculiar circumstances are the provisions of Sub-section (2) of Section 5 of the Central Excises and Salt Act and Additional Duties of Excise (Amendment) Act, 1980 and as per these provisions the Notification No.7/78, dated 17-1-1978 has retrospective effect and this is available in determining the average count of yarn in the cotton fabrics covered by the appeal. In view of this legal position, we do not find justification in the appeal filed by the Collector of Central Excise, Baroda and the same is dismissed. As regards the cross-objection filed by the respondent. It is seen that the same merely seeks to justify the order of the Appellate Collector of Central Excise. It does not seek to vary any part of the aforesaid order. Therefore, this cross-objection seems to have been filed through misconception of law. The same is also dismissed as not being valid and correct.