Customs, Excise and Gold Tribunal - Delhi
Hastings Mill Limited vs Collector Of Central Excise on 2 December, 1986
Equivalent citations: 1987(11)ECR632(TRI.-DELHI), 1987(28)ELT126(TRI-DEL)
ORDER V.T. Raghavachari, Member (J)
1. Jute yarn and twine manufactured by the appellants M/s Hastings Mill Ltd. were being used by them for further manufacture into jute manufactures classifiable under Item 22-A, CET. The Superintendent issued a show cause/demand dated 18/24-4-1981 demanding cess payable under the Jute Manufactures Cess Rules in respect of jute twine manufactured and utilised during the period 1-11-1980 to 28-2-1981 in the manner abovesaid. The appellants resisted the demand claiming that no such cess was payable in respect of twine utilised by way of captive consumption for further manufacture of jute manufactures. The Assistant Collector overruled the said objection and confirmed the demand. This was upheld by the Appellate Collector also. The revision petition preferred by the appellants against the said order to the Central Government is the present deemed appeal before us.
2. We have heard Shri V. Sridharan, Chartered Accountant, for the appellants and Shri Vineet Kumar for the respondent.
3. The cess demanded in the present appeal is in terms of the Jute Manufactures Cess Rules, 1976, framed under the provisions of the Industries (Development and Regulation) Act of 1951. We may note that in the Jute Manufactures Cess Rules, 1984 (framed under Jute Manufactures Cess Act, 1983) it has been made clear in Rule 3 that cess payable thereunder would be only on jute twine etc. removed from the factory for sale. The provisions of Jute Manufactures Cess Rules, 1976 did not contain such a provision, that the cess would be payable only in respect of material removed for sale. The findings of the lower authorities are that in terms of Rules 9 and 49 of the Central Excise Rules (which rules have been made applicable in respect of levy, collection etc. under the Jute Manufactures Cess Rules, 1976) the cess would be payable on removals for captive consumption within the factory itself. Shri Sridharan very fairly pointed out that this dispute had come up earlier for decision by this Tribunal in the case of Mahabir Jute Mills Ltd. (1984 Vol. 16 ELT 477) and that the Tribunal had held that cess would be payable under the 1976 Rules even in respect of goods removed for captive consumption within the factory for further manufacture of jute manufactures. But he submitted that he would press for our acceptance all the arguments advanced by the assessee in the said case.
4. The contention raised by Shri Sridharan before us was that the retrospective effect of the amendments made in Rules 9 and 49 of the Central Excise Rules, 1944 was by virtue of the provisions of Section 51 of the Finance Act, 1982. In other words, it was not by any provision of the Central Excise Act or Rules. He went on to say that the retrospective effect of the amendments in the said rules could not be gathered by a reading of Act or the Rules but only from the provisions of Section 51 of the Finance Act, 1982. It was, therefore, Shri Sridharan's contention that since only the Central Excise Act and the Rules applied to the levy and collection of jute cess, the retrospective amendments in Rules 9 and 49 would not have any bearing on the levy and collection of jute cess during the period in question in the present case.
5. We do not agree with Shri Sridharan's contention. Whether the retrospective effect of the amendments made in Rules 9 and 49 of the Central Excise Rules was conferred by retrospective amendments of the rules or the Act or by a specific provision in the Finance Act, 1982, the net result is that Rules 9 and 49 are deemed to have been amended in the manner set out in notification dated 20th February, 1982 from the date on which the Central Excise Rules, 1944 came into foce. If this be so, the amended rules should apply to the period involved in the present dispute also. It is not necessary for this result that the retrospect-ivity of the amendment should be visibly written into the Central Excise Act or the rules themselves. Section 51 of the Finance Act achieves the same result. Be that as it may, the Tribunal in its decision in the Mahabir Jute Mills case (supra) had, inter-alia, considered the effect of the aforesaid amendments and had taken the view that these amendments would not, in terms, be applicable to rules 9 and 49 as applied to the levy of jute manufactures cess under the Rules of 18th February, 1976.
6. We find that after elaborately going into the matter and after setting out the respective contentions the Tribunal had held that captive consumption for manufacture of further articles in the same factory would amount to removal within the meaning of even the unamended Rules 9 and 49 of the Central Excise Rules and that the provisions of Section 9(1) of the Industries (Development and Regulation) Act of 1951 authorised levy of cess on all goods produced or manufactured in any scheduled industry and in the circumstances even if the retrospective amendment of Rules 9 and 49 of the Central Excise Rules may not be applicable to the Jute Manufactures Cess Rules, 1976, yet the cess would be payable on such goods removed for captive consumption in view of such removals being removals that would attract liability for duty and cess. We are in agreement with the said conclusion.
7. Hence following the said decision we hold that the orders of the lower authorities were right. Accordingly we dismiss this appeal.