Customs, Excise and Gold Tribunal - Delhi
Collector Of Central Excise vs Metro Tyers on 9 August, 1995
Equivalent citations: 1995(80)ELT79(TRI-DEL)
ORDER G.P. Agarwal, Member (J)
1. This appeal by the Revenue is directed against the impugned adjudication order passed by the Collector of Central Excise, Chandigarh.
2. Shortly put the facts of the case are that the respondents are engaged in the manufacture of tyres and inner tubes of rubber of a kind used in the animal driven vehicles or hand carts, falling under sub-heading 4011.10 of the CET and availed the benefit of exemption under Notification Nos. 229/82, dated 15-10-1982 as amended, 14/86, dated 7-2-1986 and 188/86, dated 3-3-1986. A show cause notice dated 27-5-1986 demanding duty on clearances of tyres and tubes effected from 17-3-1985 to 31-3-1986 was issued to the respondents on the ground that they irregularly availed the benefit under the said Notification. The respondents contested the show cause notice on the round that they rightly availed the benefit under the said notification and further that the demand was time barred. The Collector who adjudicated the case vacated the said show cause notice after usual adjudication. Hence the present appeal by the Revenue.
3. Arguing on behalf of the Revenue Shri Somesh Arora, Ld. JDR submitted that the respondents had filed their classification list No. 18/84-85-C/R. VI effective from 17-3-1985 claiming exemption on tyres and tubes specially designed for use of animal driven vehicles and hand carts on the condition that the marking 'ADV and hand carts will be made on every such tyres and tubes from 17-3-1985. The same was approved. However, it was observed by the visiting officers that the respondents had not been marking 'ADV on the tyres and tubes meant for hand carts as required in the said Notification while they were prominently embossing 'ADV on the tyres and tubes meant for animal driven vehicles. On enquiry the General Manager of the respondent company in his written statement dated 1-4-1986 tendered before the visiting officers stated that they had been marking Tor Hand Cart' on the tyres and tubes meant or cart from 17-3-1985 to 31-3-1986 and not 'ADV, clarifying that marking 'For Hand Carts' instead of 'ADV on hand carts tyres and tubes was sufficient. Thus, the respondents wrongly availed the benefit of the said notification on the clearances from 17-3-1985 to 31-3-1986. As regards the findings of the Collector that demand was time barred he drew our attention to the ground number 4 of the Appeal wherein it is stated that "even though the extended period of 5 years cannot be invoked in this case, Collector's decision that the show cause notice is time-barred is not sustainable. The show cause notice dated 27-5-1986 was received by the assessee on 12-6-1986, so the demand falling within the period from 1-12-1985 to 31-3-1986 would be well within the six months period provided under Section 11A".
4. In reply the Ld. counsel for the appellants submitted that the respondents rightly availed the benefit of the said Notification. Elaborating on his submission he contended that there was substantial compliance of the conditions laid down in the said Notification No. 229/82, dated 15-10-1982, as amended. The respondents are manufacturing tyres and tubes both for 'animal driven vehicles' (ADV) and for 'Hand Carts' and these types of tyres meant for animal driven vehicles were embossed with the words "ADV" and those meant for 'Hand Carts' were embossed with the words "For Hand Carts" All these facts were stated by the respondents in their revised classification list No. 18/84-85 effective from 17-3-1985 and further in classification list No. 12/85-86 effective from 8-5-1985 and classification list No. 18/R/85-86 effective from 1-3-1986. All these classification lists were duly approved by the Assistant Collector after scrutiny and verification. On these facts it cannot be said that the respondents did not comply with the conditions laid down in the said Notification. The reasons for not marking the tyres meant for hand carts with the words 'ADV was that it would not only ridiculous to mark the tyres meant for hand cart with marking for Animal Driven Vehicles (ADV) but would be a false trade description amounting to contravention of Section 78 of the Trade & Merchandise Act, 1958 besides being a contravention of Section 415 of the Indian Penal Code if tyres meant for hand carts were described as tyres for Animal Driven Vehicles. That apart, he submitted that the very purpose of the condition laid down in the Notification that there should be a durable prominent marking of the letters "ADV" on every such tyres specifically designed for use of hand carts is that the customer purchasing such tyre may know that the same are meant for either animal drive vehicles or hand carts. The embossing of the letters "For Hand Carts" on such tyres by the respondents served the said purpose as the customers while purchasing such tyres were told that these tyres are meant for use of hand carts and referred to various decisions rendered by this Tribunal, emphasising that a Notification should not be construed in a manner which defeats its very purpose and the benefit cannot be denied on a mere technicalities or on the basis of an insignificant omission. As regards the time bar it was contended by the Ld. Counsel that the respondents were working under physical control during the relevant period and declared in their classification list the prominent marking of the letter 'ADV/Hand Carts' has been made on every such tyres and tubes and these classification lists were duly approved by the jurisdictional Assistant Collector from time to time after scrutiny and verification and, therefore, demand was rightly held to be time barred by the Collector.
5 We have considered the submissions. The main questions which arises for our determination are -
(i) Whether the respondents were entitled for the benefit of Notification No. 229/82, dated 15-10-1982, as amended by Notification No. 14/86-C.E., dated 7-2-1986 and 188/86?
and
(ii) Whether the demand was time barred?
6. The dispute relates to the period from 13-3-1985 to 28-2-1986 when the tyres and tubes manufactured by the respondents fell under Tariff Item 16 of the First Schedule to the Central Excises and Salt Act, 1944 and thereafter from 1-3-1986 to 31-3-1986 under Tariff Item 40 of the Central Excise Tariff Act, 1985. Under Tariff Items 16, 18 the Government issued the Notification No. 229/82-C.E., dated 15-10-1982 which was superseded by Notification No. 14/86 -C.E. which reads as follows :-
"In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 229/82-Central Excises, dated the 15th October, 1982, the Central Government hereby exempts tyres, tubes and flaps of the description specified in column (3) of the Table hereto annexed and falling under the sub-item specified in the corresponding entry in column (2) of the said Table, of Item No. 16 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944), form so much of the duty of excise leviable thereon under the said Act at the rates specified in the said First Schedule, as is in excess of the amount calculated the rates specified in the corresponding entry in column (4) of the said Table, subject to the conditions, if any, laid down in the corresponding entry in column (5) thereof.
TABLE
---------------------------------------------------------
S. No. Sub-item Description Rates Conditions
No.
---------------------------------------------------------
(1) (2) (3) (4) (5)
---------------------------------------------------------
1. XXX XXX XXX XXX
2. XXX XXX XXX XXX
3. XXX XXX XXX XXX
4. XXX XXX XXX XXX
5. IV Tyres and tubes Nil Provided that a
specifically desi- durable promi-
gned for use of nent marking of
animal drawn the letters
vehicles or hand "ADV" has been
carts. made on every
such tyre and
tube.
---------------------------------------------------------
Explanation:- XX XXX XX X X
(Notification No. 14/86-CE., dated 7-2-1986.)"
7. After coming into force of new Tariff that is Central Excise Tariff Act, 1985 the Government issued the identical Notification No. 188/86 which so far as relevant reads as follows :-
"In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts the goods of the description specified in Column (3) of the Table hereto annexed and falling under the Heading or sub-Heading Nos. of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), as are specified in the corresponding entry in column (2) of the said Table, from so much of the duty of excise leviable thereon under Central Excises and Salt Act, 1944 (1 to 1944), as is in excess of the amount calculated at the rates specified in the corresponding entry in column (4) of the said Table, subject to the conditions, if any, laid down in the corresponding entry in column (5) thereof.
THE TABLE
--------------------------------------------------------
Sl. No. Heading Description of Rate of Conditions
or Sub- the goods duty
heading
No.
--------------------------------------------------------
(1) (2) (3) (4) (5)
--------------------------------------------------------
1. 4013.99 Inner tubes of Nil Provided that a
rubber for tyres durable promi-
of a kind used nent marking of
on animal the letters
drawn vehicles "ADV" has been
or hand carts made on every
such tube.
--------------------------------------------------------
2. XX XX XX XX
3. XX XX XX XX
4. XX XX XX XX
--------------------------------------------------------
[Notification No. 188/86-C.E., dated 3-3-1986.]"
8. From a reading of the said Notification it is clear that the applicability of these Notification depends on two conditions, namely,
(i) the subject goods must be of the description specified in Column (3) of the Table annexed to these Notifications; &
(ii) the subject goods must fall under the First Schedule to the Central Excises and Salt Act, 1944 prior to 28-2-1986 and thereafter under the Schedule to the Central Excise Tariff Act, 1985.
9. In the instant case there is no dispute that the subject goods are of the description specified in Column (3) of the said Table and also fall under the Heading or sub-heading Nos. mentioned in Column No. (2) and, therefore, these notifications apply to the subject goods. However, the Revenue is seeking to deny the benefit of the said Notification only on the ground that instead of marking the tyre and tubes meant for Animal Driven Vehicles with the letters "ADV", the respondents had marked these tyres and tubes only with the letters "For Hand carts". It is not in dispute that these marking of the letters "For Hand Carts" on the tyres and tubes meant for Hand Carts were durable and prominent. Therefore, the entire question before us is reduced to as to whether there was a compliance of the Proviso appearing in the Column No. (4) of the said Notification.
10. It was argued by Shri Somesh Arora, Ld. JDR that the said Notification should be interpreted strictly, and if so interpreted the respondents would not be entitled for the benefit of the said Notification inasmuch as the marking of the subject tyres and tubes meant for Hand Carts with durable and prominent letters "For Hand Carts" on such tyres would not be a compliance of the said Proviso which provides for durable and prominent marking of the letters "ADV" on such tyres. On the other hand it was the contention of the Ld. counsel for the respondents that the condition laid down in the Notification to be interpreted liberally and exemption should not be denied on technical grounds as there was substantial compliance of the Proviso.
11. The question as to how the exemption Notifications issued under the Central Excises and Salt Act, 1944 are to be interpreted came up before the Apex Court in the case of Union of India v. Wood Papers Ltd. -1990 (47) E.L.T. 500 (SC) wherein it was held that -
"Literally exemption is freedom from liability, tax or duty. Fiscally it may assume varying shapes, specially, in a growing economy. For instance tax holiday to new units concessional rate of tax to goods or persons for limited period or with the specific objective etc. That is why its construction, unlike charging provision, has to be tested on different touchstone.
In fact an exemption provision is like an exception and on normal principle of construction or interpretation of statutes it is construed strictly either because of legislative intention or on economic justification of inequitable burden or progressive approach of fiscal provisions intended to augment State revenue.
But once exception or exemption becomes applicable no rule or principle requires it to be construed strictly. Truly speaking, liberal and strict construction of an exemption provision are to be invoked at different stages of interpreting it. When the question is whether a subject falls in the Notification or in the exemption clause then it being in nature of exception is to be construed strictly and against the subject but once ambiguity or doubt about applicability is lifted and the subject falls in the Notification then full play should be given to it and it calls for a wider and liberal construction. Therefore, the first exercise that has to be undertaken is if the production of packing and wrapping material in the factory as it existed prior to 1964 is covered in the Notification."
(Parapharasing and emphasis ours).
12. In the same judgment the Apex Court further observed in paragraph 4 that "Do not extend or widen the ambit at stage of applicability. But once that hurdle is crossed construe it liberally."
13. Thus, keeping in view the principle laid down by the Apex Court in the said case the first and foremost question is as to whether the respondents herein come within the purview of the said Notification. If they do, only thereafter, the question of interpretation of the Notification liberally with reference to the intention thereto or not to interpret it in such a way as to make the object of the Notification nugatory or there was substantial compliance of the Proviso will arise. On the question of the applicability of these Notifications to the subject goods there is no dispute since it is an admitted fact that the subject goods answer the description specified in Column (3) of the Table attached to these Notifications and falls under the Heading or sub-heading Nos. of the First Schedule to C.E.T. Act, 1985. Thus, the hurdle of construing the exemption Notification in hand strictly is over. And "once that hurdle is crossed" one has to 'construe it liberally' as observed by the Apex Court and extracted above. Construing the Proviso liberally in Column No. (4) of the Table we find that respondents were entitled for the benefit of the said Notifications. From the scheme of the Central Excise Tariff it is clear that the Tariff makes a distinction between the tyres and tubes which are meant for power driven vehicles, animal driven vehicles (ADV) and human driven vehicles known as hand-carts. It is common knowledge that tubes and tyres which are specially designed for the power driven vehicles are different and superior, in fact, tyres and tubes specially designed for use of Animal Driven Vehicles (ADV) or hand carts require poorest quality whereas the tyres and tubes designed for power driven vehicles should be of the highest quality and, therefore, the exemption has been granted under the said Notification to the tyres and tubes which are specially designed for use of animal driven vehicles (ADV) or hand carts and to mark these tyres with a durable prominent letters "ADV" is a procedural requirement to distinguish these tyres and tubes especially designed for use of power driven vehicles. In the instant case there is no dispute that there was a durable prominent marking of the letters "For Hand Carts" on every such tyres and tubes specially designed for use of hand carts instead of the marking with the letters "ADV". These appears to be a sufficient compliance of the said requirement. In this view of the matter we are supported by the ratio of series of judgments rendered by this Tribunal. To name a few, in the case of Krishna Sahakari Sakhar Karkhana Ltd. v. Collector of Central Excise, 1991 (55) E.L.T. 411, it was held that failure to fulfil the condition of Proviso (b)(ii) of the Notification No. 231/87-C.E. providing that credit shall be taken only in respect of such Ethyl Alcohol for which the manufacturer has paid the price notified under the orders of the Government of India could not be a ground for denying the benefit of the said notification to the assessee therein if that condition is construed on a liberal basis. For this view reliance was placed on the judgment rendered by the Supreme Court in the case of Union of India v. Wood Papers Ltd. Supra. In the case of Chemicals & Plastics India Ltd. v. Collector of Central Excise, 1988 (36) E.L.T. 651 it was held by this Tribunal that when exemption is subject to filing of declaration in terms of Appendix to Notification No. 201/79-C.E. the failure to file such declaration is condonable being procedural if other requirements and procedure have been complied with. Similarly, in the case of Collector of Central Excise v. Sanchem Enterprises, 1990 (50) E.L.T. 528 it was held that the benefit of exemption notification cannot be denied to an assessee on the ground of procedural lapse if an assessee was entitled to the benefit. In the case of Collector of Central Excise v. Vamsadara Paper Mills Ltd., 1988 (37) E.L.T. 243 it was held that benefit of exemption notification is not deniable if there has been substantial compliances of the requirement of the notification. Further the case of Cyano Pharma v. Collector of Central Excise, Indore,1987 (31) E.L.T. 964 also lends assurance to our said views. Rule 96-ZN of the Central Excise Rules, 1944 prescribed the manner of marking of the label and container of each drug or medicinal preparations which are sought to be removed without attracting duty liability. In that case of Cyano Pharma v. Collector of Central Excise, Indore, supra it was the contention of the Revenue that the assessee has failed to comply with the requirements of Rule 96-ZN (2) of the Central Excise Rules, 1944 inasmuch as the recognised abbreviation for the relevant pharmacopoeia does not appear immediately after the name of the drug on the carton. Repelling the contention it was held that the appearance of the recognised abbreviation for the relevant pharmacopoeia just below the name of the drug on the carton should suffice. Moreover, it is settled law that an exemption notification cannot be interpreted in a way so as to create a duty liability (See the case of Sakthi Sugars Limited, Coimbatore v. Union of India and Ors., 1983 (12) E.L.T. 484 and Kiran Spinning Mills, Thane v. Collector of Central Excise, Bombay-II-1981 (17) E.L.T. 896.
14. In the light of the above discussions we hold that the respondents were rightly entitled for the benefit of the said Notification.
15. Besides, we find that show cause notice dated 27-5-1986 demanding duty from 13-3-1985 to 31-3-1986 was issued to the appellants invoking the larger period of 5 years. From the record we find that in all the relevant classification lists it was specifically mentioned that permanent marking of the letter 'ADV'/'Hand Carts' had been made on every such tyre and tube specifically designed for use of animal driven vehicles or hand carts. These classification lists were duly approved by the authorities concerned. On these facts the Collector has held that the facts alleged to be suppressed by the appellants in the show cause notice were in the knowledge of the Department and, therefore, the demand was time barred. These findings have not been seriously challenged in the Memorandum of Appeal or during the hearing. What was vehemently contended was that even though the extended period of 5 years cannot be invoked, the Collector's decision that the show cause notice is time barred is not sustainable as the demand falling within the period from 1-12-1985 to 31-3-1986 would be well within the 6 months period under Section 11-A to which the Ld. counsel for the respondents had no plausible defence. Thus, after going through the evidence on record we agree with the Ld. JDR. that the show cause notice demanding the duty from 1-12-1985 to 31-3-1986 if otherwise recoverable (which is not the case here as discussed above) was not time barred since it fell within the normal period of 6 months and rest was time barred.
16. In view of the foregoing, the appeal is rejected.
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(G.P.Agarwal) Member (J) P.K. Kapoor, Member (T)
17. I have given my earnest consideration to the order passed by my learned brother Shri G.P. Agarwal, Member (Judicial). I am unable to agree with the same for the reasons which are given below.
18. The question to be determined in this case is whether the tyres meant for 'Hand Carts' manufactured by the appellants when embossed with the words Tor Hand Carts' were eligible for exemption under Notification No. 229/82-C.E., dated 15-10-1982 which was superseded by Notification No. 14/86-C.E., dated 7-2-1986 and under which tyres and tubes specially designed for use of both animal driven vehicles or hand carts were exempt from duty subject to the condition that a durable prominent marking of letters 'ADV was made on every such tyre and tube. In the appellants' case it is an admitted fact that during the relevant period i.e., between 1-3-1986 to 31-3-1986 in respect of disputed Hand Cart tyres the condition of the notification was not fulfilled inasmuch as instead of marking the tyres with the letters 'ADV as laid down in Column V of the notification they were marked Tor Hand Carts'.
19. It is evident that the condition laid down in Column 5 of the Notification No. 14/86-C.E., dated 7-2-1986 requiring tyres meant for the use of Animal Driven Vehicles as well as Hand Carts to bear the same marking i.e., 'ADV was not through any oversight or inadvertance since in the amending Notification No. 188/86-C.E., dated 3-3-1986 as well as the same condition was laid down. It has been laid down by the Hon'ble Supreme Court in the case of Hemraj Gordhandass v. H.H. Dave, Assistant Collector of Central Excise & Customs, Surat reported in 1978 (2) E.L.T. (J 350) that in a taxing statute there is no room for any intendment but regard must be had to the clear meaning of the words. The entire matter is governed wholly by the language of the notification. If the tax payers is within the plain term of the exemption it cannot be denied its benefit by claiming in aid any supposed intention of the exempting authority."
20. Even if it is assumed that the language of the notification is deficient, in the facts of the case it would not be permissible for the Tribunal to take a view favourable to the assessee since in the case of Assistant Collector of Central Excise & Customs, Pondichery v. New Horizon Sugar Mills (P) Ltd., reported in 1980 (6) E.L.T. 10 (Madras), the Madras High Court has held that "If the language of the notification is deficient to bring out the real intention of the authors who issue the notification it is not for the court to supply the deficiency."
21. On the question of limitation I agree with the findings of the learned Member (Judicial).
22. The appeal is disposed of in the above terms.
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(P.K. Kapoor) Member (T) Dated 3rd January, 1994 DIFFERENCE OF OPINION
23. Since there is a difference of opinion between the Hon'ble Members comprising the Bench, the matter is submitted to the Hon'ble President for opinion on the following point :-
"Whether in the facts and circumstances of the case, the respondents were entitled for the benefit of exemption under Notification No. 229/82 dated 15-10-1982 as amended, 14/86 dated 7-2-1986 and 188/86 dated 3-3-1986".
Sd/- Sd/-
(G.P. Agarwal) (P.K. Kapoor)
Member (J) Member (T)
Lajja Ram, Member (T)
24. The point of difference referred to me is whether in the facts and circumstances of the case, the respondents were entitled for the benefit of exemption under Notification No. 229/ 82 C.E., dated 15-10-1982 as amended, 14/86 C.E., dated 7-2-1986 and 188/86 C.E., dated 3-3-1986.
25. The matter was heard by me on 3-4-1995 when Shri Harbans Singh, Advocate appeared for the respondents - M/s. Metro Tyres (P) Ltd. The appellants - Revenue - was represented by Shri J.P. Singh, JDR.
26. Shri Harbans Singh, the learned Advocate stated that the tyres and the tubes manufactured by the respondent met the substantial requirement of the relevant exemption Notifications and were correctly eligible for the exemption from Central Excise duty granted by those Notifications. It was submitted that the tyres for the hand carts were specially designed for the purposes of use in hand carts only, and that the tyres for hand carts and that for animal drawn vehicles were different in design. The learned Advocate referred to the Supreme Court's decision" in the case of Mac Laboratories Pvt. Ltd. v. Collector of Central Excise, Bombay, 1994 (74) E.L.T. 769 (SC) to plead that the exemption notification should not be read narrowly or technically, and that the exemption should be so interpreted as not to narrow down and curtail the ambit of the relief provided. Reference was also made to the Supreme Court's decision in the case of Union of India v. Wood Papers Ltd., 1990 (47) E.L.T. 500 (SC) which had been discussed by the learned Member (J) in the order proposed by him. The learned Advocate submitted that the facts in the present case are different than the facts before the Supreme Court in the case of Hemaraj Gordhandass v. Asstt. Collector of Central Excise, Surat 1978 (2) E.L.T. (J 350), and that the observations made by the Supreme Court in that judgment are not applicable to the issue in the present proceedings.
27. Shri J.P. Singh, the learned JDR stated that the condition for specific marking on the tyres and tubes was stipulated in the exemption notification itself, and it was very much a substantial requirement for eligibility of the exemption. The exemption notifications had to be construed strictly. In the circumstances of the case, the benefit for exemption could not be given to the respondent company. The learned JDR pleaded for the order proposed by the learned Member (T).
28. I have carefully considered the matter. The respondent had clarified that the specifications for the two type of tyres - one for the hand carts and the other for the animal drawn vehicles (ADV), were different. They were engaged in the manufacture of tyres/tubes both for hand carts and for the animal drawn vehicles. For ADV tyres, there was a durable prominent marking of the letters "ADV" on each such tyre. The tyres for hand carts were durably and prominently marked as "For Hand Cart" so that the tyres for ADV may not find their way to the users of hand carts, or vice versa, it is seen that there is no allegation that the tyres and tubes under dispute were not specifically designed for use of hand carts. There is nothing to show that they were used for any other purpose, other than for use of hand carts.
29. The applicable exemption notification provided nil rate of central excise duty to the tyres/tubes specifically designed for use of ADV or hand carts. The exemption was subject to the condition that a durable prominent marking of the letters 'ADV had been made on each such tyre/tube. The provision providing nil rate of central excise was of a substantial character. While the provision providing for marking was of a procedural character. In the case of Mangalore Chemicals and fertilizers Ltd. v. Dy. Commissioner -1991 (55) E.L.T. 437 (SC), the Hon'ble Supreme Court had observed - "There are conditions and conditions, some may be substantive, mandatory and based on considerations of policy and some others may merely belong to the area of procedure. It will be erroneous to attach equal importance to the non-observance of all conditions irrespective of the purpose they were intended to serve".
30. The respondent marked 'ADV on tyre/tube for Animal Drawn Vehicles, and 'for hand cart' on tyre/tube for hand carts. Thus technically speaking, they had not satisfied the procedural condition laid down for enjoying the nil rate of excise duty. There is however, no denying of the fact that the tyres/tubes under dispute were specifically designed for use of hand carts, and thus satisfied the substantive condition for the exemption. While there could be no dispute with the general proposition that the exemption notifications had to be construed strictly, it is seen that in the present specific case, the technical and literal interpretation of the condition relating to the marking on the goods, and the mechanical approach in interpreting the requirement of marking on the goods, will result in the denial of the benefit for which, but for the marking 'for hand cart' in place of 'ADV
31. The goods at a value with no excise duty component had already been cleared and passed into consumption; the matter relates to the period 12-12-1985 to 31-3-1986; the goods were cleared after approval with nil rate of excise duty. These goods were specifically designed for hand carts. Hand cart is drawn/pulled/pushed by human hands. It is seen that under the same exemption Notification No. 229/82-C.E., dated 15-10-1982, tyres for cycles/powered cycles, cycle rickshaws, powered cycle rickshaws enjoyed full un-conditional exemption from duty. To deny the exemption in the present case only on the ground that the tyres/tubes were marked 'for hand cart' in place of requirement of marking 'ADV, although technically right, may not be reasonable, and in the present case will lead to un-just results and discrimination. The demand of central excise duty for past clearances in such a situation could hardly be justified, particularly, when the initial clearances were made with the approval of the Department. In this connection reference may also be made to the Supreme Court's decision in the case of Formica India Division v. Collector of Central Excise, 1995 (77) E.L.T. 511 (SC).
32. The Central Excise Exemption Notification No. 16/41-C.E., dated 1-4-1941, which provided exemption to tyres specially designed for use on hand carts was issued when tyres were brought under excise control w.e.f. 1-4-1941. It appears from the amending Notification No. 153/80-C.E., dated 11-10-1980 that the provision regarding marking was not there initially and was added only w.e.f. 1-4-1981.
33. In the case of Hansraj Gordhandas v. Asstt. Collector of Central Excise, Surat -1978 (2) E.L.T. (J 350), the Hon'ble Supreme Court had not ruled out the interpretation of an enactment by reasonable and necessary implication. Further in the present proceedings it is not the deficiency in the language of the notification which is an issue but the justifiability of demand in respect of past clearances after approval of the Central Excise Officers, on the ground of 'marking' different than the one provided. There is also no question to extend the term and the scope of the notification. No extended meaning is being given to the exempted item to enlarge the scope of exemption granted by the notification as was the case in Rajasthan Spinning and Weaving Mills Ltd. v. Collector of Central Excise, Jaipur -1995 (77) E.L.T. 474 (SC).
34. After taking into account the specific facts in the present case, and the general approach of the Hon'ble Supreme Court in such matters, the learned Member (J) had come to a conclusion that the respondents were rightly entitled for the benefit of the notification under consideration. In the special circumstances of this case after taking all the relevant considerations into account, I agree with him. The appeal filed by the Revenue is liable to be rejected.
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(Lajja Ram) Member (T) Dated 20th July, 1995 FINAL ORDER
35. In accordance with the majority opinion it is held that the respondents were rightly entitled for the benefit of the Notification No. 229/82-C.E., dated 15-10-1986 as amended, 14/86, dated 7-2-1986 and 188/86, dated 3-3-1986. It is further held that the demand was also time barred to the extent indicated earlier by both of us in this order as amended by Misc. Order No. 8/95-C, dated 21-12-1994.
36. In the result the appeal is rejected.