2003 (11) TMI 68 - SUPREME COURT

Whether assessee rightly claimed exemption from payment of excise duty under Notification No. 217/86-C.E., dated 2nd April, 1986 for the period 1986-1995?

Held that:- The difference between the exemption and the exclusion lies in the phrases "used for producing or processing of any goods" and "goods for bringing about any change in any substance" occurring only in the exclusion. These operative words in the exclusionary clause "used for producing or processing" and "bringing about any change in any substance" must mean something less than "used in or in relation to the manufacture of the final products". The Tribunal has said that the operative phrases in the exclusion "indicated direct or immediate use in actual production or processing of goods or bring about any change in any substance". We agree Some mentioned characteristics. They are, therefore, exempted from payment of excise duty under the 1986 Notification.

We can, in the circumstances, conclude that the Tribunal's interpretation was accepted by the Revenue and they are precluded from taking an inconsistent stand now. Appeal dismissed.