Saidex Industries Vs. Collector of Central Excise

Saidex Industries vs Collector of Central Excise

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Jan 28, 1994

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Citation: sooperkanoon.com/7268
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Judge: G Agarwal, M T S.D.
Decided On: Jan 28, 1994
Subject: Land Acquisition

Case Summary

AI-generated summary - not the official court judgment text.

Land Acquisition

Key legal issue: Land Acquisition

Parties & Advocates

Appellant / Petitioner

Saidex Industries

Respondent

Collector of Central Excise

Legal References

Reported In: (1994)(52)LC161Tri(Delhi)

Excerpt

.....month of march 1986 at the rates prescribed under the said notification no. 175/86-ce dated 1.3.1986. the operation of notification no. 175/86-ce dated 1.3.1986 was suspended during the period 25.3.1986 to 31.3.1986 by notification no. 202/86-ce dated 25.3.1986.2. the notification no. 212/86-ce dated 25.3.1986 was issued in respect of the period 25.3.1986 to 31.3.1986. the rates prescribed under notification no. 212/86-ce dated 25.3.1986 were equal to the rates prevalent prior to 1.3.1986 under notification no. 85/85-ce dated 17.3.1985. both these notifications fully exempt clearances up to the value of rs. 7.5 lakhs; in excess of 25% of for next 7.5 lakhs i.e.3.75% ad valorem; in excess of 50% of the normal duty, that is, 7.5% ad valorem for the clearances in excess of rs. 15 lakhs and up to rs. 25 lakhs; and in excess of 75% of the normal duty, that is, 11.25% ad valorem for clearances in excess of rs. 25 lakhs and up to rs. 40 lakhs taken during the financial year. in respect of clearances during the month of march 1986 the appellants had paid duty at 50% ad valorem, that is, normal rate less 10% ad valorem vide notification 175/86-ce dated 1.3.1986. however, in respect of clearances during 25.3.1986 to 31.3.1986 they have subsequently paid the difference between the rate allegedly applicable to the appellants under notification no. 212/86-ce dated 25.3.1986, that is, 7.5 ad valorem less the duty already paid at 5% ad vaorem, on the ground that their clearances during the preceding financial year were rs. 17,41,561, that is, within the slab of rs. 15 lakhs to rs. 25 lakhs for which the rate applicable under notification 212/86-ce dated 25.3.1986 was 50% of normal rate, that is, 7.5% ad valorem. subsequently, central duties of excise (retrospective exemption) act, 1986 was enacted vide which all notifications issued between 3.3.1986 and 8.8.1986 which had for its purpose the object of extending the rate of duty at the level prevalent prior to 1.3.1986 were.....

Full Judgment

1. The appellants is an SSI unit manufacturing starch falling under T.I. 15C of erstwhile Central Excise Tariff. Prior to 1.3.1986, they were availing of the benefit of exemption to small scale industries under Notification No. 85/85-CE dated 17.3.1985. The said Notification was superseded and replaced by Notification No. 175/86-CE dated 1.3.1986. The appellants were required to pay duty on their clearances during the month of March 1986 at the rates prescribed under the said Notification No. 175/86-CE dated 1.3.1986. The operation of Notification No. 175/86-CE dated 1.3.1986 was suspended during the period 25.3.1986 to 31.3.1986 by Notification No. 202/86-CE dated 25.3.1986.

2. The Notification No. 212/86-CE dated 25.3.1986 was issued in respect of the period 25.3.1986 to 31.3.1986. The rates prescribed under Notification No. 212/86-CE dated 25.3.1986 were equal to the rates prevalent prior to 1.3.1986 under Notification No. 85/85-CE dated 17.3.1985. Both these Notifications fully exempt clearances up to the value of Rs. 7.5 lakhs; in excess of 25% of for next 7.5 lakhs i.e.

3.75% ad valorem; in excess of 50% of the normal duty, that is, 7.5% ad valorem for the clearances in excess of Rs. 15 lakhs and up to Rs. 25 lakhs; and in excess of 75% of the normal duty, that is, 11.25% ad valorem for clearances in excess of Rs. 25 lakhs and up to Rs. 40 lakhs taken during the financial year. In respect of clearances during the month of March 1986 the appellants had paid duty at 50% ad valorem, that is, normal rate less 10% ad valorem vide Notification 175/86-CE dated 1.3.1986. However, in respect of clearances during 25.3.1986 to 31.3.1986 they have subsequently paid the difference between the rate allegedly applicable to the appellants under Notification No. 212/86-CE dated 25.3.1986, that is, 7.5 ad valorem less the duty already paid at 5% ad vaorem, on the ground that their clearances during the preceding financial year were Rs. 17,41,561, that is, within the slab of Rs. 15 lakhs to Rs. 25 lakhs for which the rate applicable under Notification 212/86-CE dated 25.3.1986 was 50% of normal rate, that is, 7.5% ad valorem. Subsequently, Central Duties of Excise (Retrospective Exemption) Act, 1986 was enacted vide which all Notifications issued between 3.3.1986 and 8.8.1986 which had for its purpose the object of extending the rate of duty at the level prevalent prior to 1.3.1986 were deemed to have been issued on 1.3.1986.The Department has, therefore, demanded the duty for the period 1.3.1986 to 24.3.1986 being the difference between 7.5% allegedly leviable and 5% ad valorem actually paid.

3. The appeal of the appellants against the Order-in-Original of the Adjudicating Authority has been rejected by the impugned Order-in-Appeal which is the subject matter of the present appeal.

4. In the present appeal, the appellants have reiterated the plea taken before the lower authority, that the operation of Notification No.175/86-CE dated 1.3.1986 had been suspended by Notification No.202/86-CE dated 25.3.1986 only during the period 25.3.1986 to 31.3.1986 and hence, the rates prescribed under the Notification No. 212/86-CE dated 25.3.1986 could not be made applicable for the period 1.3.1986 to 24.3.1986, even after the enactment of Central Duties of Excise (Retrospective Exemption) Act, 1986.

5. Shri Somesh Arora, learned JDR conceded that the case is covered against the Department vide the decision in the case of Mysore Cork Industries v. Collector of Central Excise 6. Considered. The issue required to be decided in this case lies in a short compass, namely, whether for the period 1.3.1986 to 24.3.1986, the rates prescribed under Notification No. 175/86-CE dated 1.3.1986 will apply as contended by the appellants or those prescribed under Notification No. 212/86-CE dated 25.3.1986 will apply/as contended by he Department by virtue of Central Duties of Excise (Retrospective Exemption) Act, 1986. 7. The relevant portion of Central Duties of Excise (Retrospective Exemption) Act, 1986 is reproduced below for the sake of convenience.

Every notification issued by the Government of India in the Ministry of Finance (Department of Revenue) on or after the 3rd day of March, 1986, but before the 8th day of August, 1986, in exercise of the powers conferred by Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, for the purpose of, -- (b) maintaining the effective rates of duties of excise in respect of certain goods at the level obtaining prior to 1st day of March 1986, notwithstanding the changes in the rates of duties of excise made by the Finance Bill, 1986, shall, in so far as such notification relates to such goods, be deemed to have, and to have always had, effect on and from the 1st day of March, 1986.

8. For invoking the provisions of above Act, what is necessary to be established is whether the Notification No. 212/86-CE dated 25.3.1986 had been issued for the purpose of, inter alia, maintaining the effective rates of duties of excise in respect of certain goods at the level obtaining prior to 1st day of March 1986, notwithstanding the changes in the rates of duties of excise made by the Finance Bill, 1986.

9. As pointed out above, the rates prescribed under Notification No.212/86-CE dated 25.3.1986 (initially for the period 25.3.1986 to 31.3.1986) and those prevalent under Notification No. 85/85-CE dated 17.3.1985 are identical, namely, nil for the clearances up to first 7.5 lakhs, 25% of normal duty for the clearances between Rs. 7.5 lakhs to Rs. 15 lakhs; 50% of normal duty for clearances above Rs. 15 lakhs and up to Rs. 25 lakhs, and 75% of normal duty for clearances above Rs. 25 lakhs and up to 40 lakhs and full duty for clearances in excess of Rs. 40 lakhs.

10. The duty actually paid under Notification No. 175/86-CE dated 1.3.1986 for the period 1.3.1986 to 24.3.1986 is 5% ad valorem that is, normal duty, less 10% ad valorem, as seen from the Order-in-Original and Order-in-Appeal.Mysore Cork Industries v.Collector of Central Excise (supra), a view has been taken that the operation of Notification No. 175/86-CE dated 1.3.1986 had been suspended only for one week, that is, 25.3.1986 to 31.3.1986 vide Notification No. 212/86-CE dated 25.3.1986 and further that: Nothing has been shown to us that the said goods in respect of which the benefit was sought to be given in terms of Notification No. 212/86-CE was sought to be restored to the level as it existed in respect of the very same goods up to 28.2.1986. In any view of the matter we hold that the demand made up to the period 24.3.1986 is not maintainable.

12. We are unable to follow the above view/decision (supra) in the present case for the reason given below.

The rates of duty under both the Notifications involved in the present appeal, viz., Notification No. 85/85-CE dated 17.3.1985 and 212/86-CE dated 25.3.1986 are identical, as also admitted in the grounds of appeal, namely, On 25.3.1986 Notification No. 212/86-CE was issued reviving notification No. 85/85-CE dated 17.3.1985 for a period of seven days, that is. 25.3.1986 to 31.3.1986.

13. It may be observed that the same was the position of many Notifications dated 25.3.1986 and the corresponding notifications in force prior to 1.3.1986 issued between 3.3.1986 and 8.8.1986 including Notification No. 213/86 in the present case.

14. Hence, though initially the rates prescribed under Notification No.212/86-CE dated 25.3.1986 to 31.3.1986 these become applicable right from 1.3.1986 by virtue of the provisions of Central Duties of Excise (Retrospective Exemption) Act, 1986, since it is not disputed that these rates were identical to the rates prevalent prior to 1.3.1986 under Notification No. 85/85-CE dated 17.3.1985.

15. Hence the short levy being the difference between the duty paid at the rates prescribed under Notification No. 212/86-CE dated 25.3.1986 read with Central Duties of Excise (Retrospective Exemption) Act, 1986, for the period 1.3.1986 to 24.3.1986, while finalising the RT 12 for March 1986 (filed on 7.4.1986) on 3.7.1986, is in order, as there is no time bar also involved.

16. The appeal is in our opinion, liable to be rejected. However, in view of the contrary decision of the Tribunal (SRB) at para 5 above regarding a similarly worded Notification No. 213/86-CE dated 25.3.1986 case (as against Notification No. 212/86-CE dated 25.3.1986 involved in this case), Hon'ble President may kindly like to refer the issue to a Larger Bench for reconsideration of the said decisions.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Saidex Industries vs Collector of Central Excise Same Subject Land Acquisition Same Judge G Agarwal, M T S.D.