2000 (5) TMI 806 - AT - Central Excise

Summary

Issues:
Entitlement to benefit of Notification No. 1/93-CE, dated 28-2-1993, as amended by Notification No. 59/94-C.E., dated 1-3-1994 effective from 1-4-1994 for units registered with DGTD.

Analysis:
The central issue in this appeal before the Appellate Tribunal CEGAT, Kolkata was whether the appellants, registered with the DGTD, were entitled to the benefits of Notification No. 1/93-CE, as amended by Notification No. 59/94-C.E., effective from 1-4-1994. Prior to this amendment, the appellants were enjoying the benefits of the notification; however, the amendment introduced a restriction that the benefit would not be available to a factory registered with the DGTD. The Revenue contended that the appellants were not entitled to the small-scale exemption benefit from 1-4-1994, resulting in their clearances being chargeable to duty at 15% ad valorem. Subsequently, another Notification No. 125/94-C.E. was issued on 31-8-1994, making the benefit of Notification No. 1/93 available again to units registered with the DGTD.

The appellant's representative argued that they continued to avail the benefit of the notification in April based on news cuttings suggesting that the DGTD had ceased to exist from 1-4-1994. They contended that the subsequent notification dated 31-8-1994 should be considered clarificatory and given retrospective effect from 1-4-1994. On the other hand, the respondent's representative opposed this, stating that the news cuttings indicated a different scenario where the work of the DGTD would still be carried out by other government departments. They argued that the notification dated 31-8-1994 was a change in policy and not clarificatory, and thus, the appeal should be dismissed.

After considering the arguments from both sides, the Tribunal analyzed whether the benefit of Notification No. 125/94-C.E., dated 31-8-1994, could be granted retrospectively. The Tribunal noted that this notification withdrew a condition introduced by Notification No. 59/94 from 1-4-1994, which restricted DGTD registered units from availing the benefits of Notification No. 1/93. The Tribunal concluded that this withdrawal of conditions could not be considered clarificatory and that the negative condition was introduced simultaneously with the cessation of the DGTD, implying legislative awareness. The Tribunal held that the amendment in the notification dated 31-8-1994 did not indicate retrospective applicability from 1-4-1994. Consequently, the appeal was rejected, and the impugned order was upheld.