TMI Blog1990 (3) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... h duty is paid under Tariff Item 68 of the 1st Schedule to the Act. Petitioner, also uses synthetic rubber, carbon black and rubber processing chemicals, in the manufacture of rubber products. These products, are, hereinafter, referred to as the inputs. 4. On June 4,1979, the Central Government, issued a Notification No. 201/79 -C.E. whereby, exemption was granted to goods, in the manufacture of which, items falling under Tariff Item 68, have been used as inputs, to the extent of duty paid on such inputs. The Central Government, further issued an amendment to notification dated March 1,1979, vide Notification No. 58/82-C.E., dated February 28,1982, by which, the Central Government, exempted tyres and tubes, in the manufacture of which, synthetic rubber, carbon black and rubber processing chemicals have been used to the extent of the duty, paid on such synthetic rubber, carbon black and rubber processing chemicals. 5. On September 7,1982, petitioners wrote to the Assistant Collector of Central Excise, thereby pointing out, that on a true and proper interpretation of Section 50 of the Finance Act, 1982, the exemption of set off, granted under the aforesaid notifications, would be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r has not acted on the basis of any direction, issued by respondent No. 2. It is further alleged by respondents that the special excise duty, is to be calculated first, on the chargeable basis of the excise duty and set off/proforma credit, available on the raw materials/component parts, is to be availed of thereafter. 10. It is further alleged that petitioners are manufacturing dutiable, as well as, non-dutiable tyres and they can avail of proforma credit in respect of, duty paid on the inputs, in accordance with Notification No. 201/79 (annexure 'A'). Petitioners are not entitled to avail of proforma credit, in respect of tyres, which are exempted from whole of the duty of excise or are chargeable to nil rate of duty. 11. Mr. Rajinder Dutt has raised a preliminary objection, that the writ petition is not maintainable, on the ground, that petitioners have alternative remedies, available to them, under the Act. Petitioners ought to have availed of and exhausted those remedies, such as, by way of appeal and revision, as provided under the Act. 12. Mr. Ravinder Narain, contests this plea of the Union of India, on the ground, that petitioners are challenging the Directive, issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arising out of these Rules. Under this rule the only instruction that the Board can issue is that relating to administrative matters, otherwise that rule will have to be considered as ultra vires of Section 35 of the Act." 14. We accept this contention of Mr. Ravinder Narain as, in our view, the present writ petition is maintainable. 15. The main question, which arises for consideration is, as to whether, under Section 50 of the Finance Act, 1982, the exemption of set off, granted under the aforesaid notification, should be availed of first and, the special duty is to be calculated thereafter, or the special excise duty is to be calculated, in accordance with the impugned Directive, issued by respondent No. 2. 16. The answer to this question, depends upon the true interpretation of Section 50 of the Finance Act, 1982. 17. Mr. Ravinder Narain has contended that the words 'so chargeable' in the Section, clarify the amount of duty, leviable under the Act, read with any notification, in force, relating to the duty under the Act. It means, that on a true and proper reading of this Section, special duty is to be calculated after giving effect to the notification, granting exempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to be a sure guide to reach at the real legislative intent. In such a case, in order to ascertain the true meaning of the terms and phrases employed, it is legitimate for the Court to go beyond the arid literal confines of the provisions and to call in aid other well-recognised rules of construction, such as its legislative history, the basic scheme and framework of the statute as a whole, each portion throwing light on the rest, the purpose of legislation, the object sought to be achieved, and the consequences that may flow from the adoption of one in preference to the other possible interpretation. Where two alternative constructions are possible the Court must choose the one which will be in accord with the other parts of the statute and ensure its smooth, harmonious working, and eschew the other which leads to absurdity, confusion or friction, contradiction and conflict between its various provisions, or undermines, or tends to defeat or destroy the basic scheme and purpose of the enactment. These canons of construction apply to the interpretation of our Constitution with greater force, because the Constitution is a living, integrated organism, having a soul and consciousn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with any notification for the time being in force, issued by the Central Government, in relation to the duty so chargeable." It means that in order to calculate the special excise duty, the exemption by set off has to be claimed before the special duty of excise is levied. 23. In other words, the liability of the assessee, is to pay, such amount of basic excise duty, after giving effect to the exemption notifications, for the time being in force. So, this is the amount "so chargeable". 24. In our view, this intention of the Legislature is expressed, with sufficient clarity, by the language of Section 50(1) of the Finance Act, 1982. We hold that the exemption by set off, was first to be given effect and special excise duty was to be calculated thereafter. The result is, that the clarification, given by the impugned Directive, issued by respondent No. 2, is not correct. 25. We may note that the language of Section 50 of the Finance Act, 1982, has now been amended by Section 55 of the Finance Act, 1983. 26. The last contention of Mr. Ravinder Narain is that the Directive, given to petitioner, by respondent No. 4, to debit the credit, taken in respect of exempted tyres, tube ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
