1983 (9) TMI 271 - AT - Central Excise

Summary

Issues:
- Interpretation of Central Excise Tariff notifications
- Retrospective effect of Notification No. 168/72-C.E.
- Liability of appellants for payment of duty

Interpretation of Central Excise Tariff notifications:
The appellants argued that the Department was not justified in applying Notification No. 168/72-C.E. retrospectively. They contended that they should only be liable to pay the duty at the rate in force on the date of removal of the yarn for captive consumption. They relied on a previous appeal where a similar principle was acknowledged by the Tribunal. The appellants' position was that the duty had already been paid at the applicable rate during removal for captive consumption, and no further liability should be imposed on them.

Retrospective effect of Notification No. 168/72-C.E.:
The appellants highlighted that they had removed the yarn for captive consumption before the enforcement of Notification No. 168/72-C.E., which introduced higher duty rates. They argued that the new rates should not be applied retrospectively to the yarn already consumed in weaving fabrics. The Tribunal agreed with the appellants, stating that the rates prescribed in the notification could not be retroactively applied to yarn that had been legitimately removed and consumed before the notification came into effect.

Liability of appellants for payment of duty:
The Tribunal carefully considered the circumstances and ruled in favor of the appellants. They noted that the yarn had been lawfully removed for captive consumption in weaving fabrics, and as per Rule 9A, the duty rate applicable on the date of removal should be enforced. Since the duty had already been paid at that rate, the appellants were not liable for any additional duty. The Tribunal upheld the appellants' argument that their liability was limited to the duty payable based on the rates specified in the relevant notifications, namely No. 63/72-C.E. and No. 64/72-C.E. Consequently, the Tribunal allowed the appeals and granted relief to the appellants, absolving them from further duty payment obligations.