The Union of India and Ors. Vs. M/s. Modi Rubber Limited
EmailAppeal: Civil Appeal Nos. 415-419 of 1983.
Petitioner: The Union of India and Ors.
Respondent: M/s. Modi Rubber Limited
Apeal: Civil Appeal Nos. 415-419 of 1983.
Judges: BHAGWATI, C.J., V. KHALID & G.L. OZA, JJ.
Date of Judgment: Aug 18, 1986
Head Note:
Central Excise & Salt Act, 1944, Rules 2(v) & 8(i) of the Central Excise Rules, 1944; Item no. 16 of the First Schedule; Notification of the Government of India bearing Nos. 123/74-C.E. & 27/81-C.E. – Notification bearing No. 123/74-C.E. exempted tyres for motor vehicles from a part of the excise duty leviable thereon & Notification bear-ing No. 27/81-C.E. exempted tyres of two-wheeled & three wheeled motor vehicles, power cycles,power cycled rickshaws, tractors & trailors, “from so much of the duty of excise levi-able thereon as is in excess of the duty specified in the corresponding entry in Col.5” of the Table annexed to the Notification – Meaning & interpretation of the expression “duty of excise” employed in the two Notifications – The expression ‘duty of excise’ in these Notifications must bear the same meaning which it has in Rule 8(1) and that meaning clearly is – Excise duty payable under the Central Excise & Salt Act, 1944 as envisaged in Rule 2 clause (v) – Duty of excise duty & auxiliary excise duty.
The assessee is a limited company which manufactures tyres. The manufacture of tyres is subject to duty of excise under the Central Excise & Salt Act, 1944. Notification bearing No. 123/74-C.E. dated 1.8.1974 was issued by the Central Government exempting tyres for motor vehicles from a part of the excise duty leviable thereon. Another Notification bearing No. 27/81-C.E. dated 1.3.1981 was issued by the Central Government in respect of tyres for two-wheeled & three wheeled motor vehi-cles, power cycles, power cycled rickshaws, tractors and trailors exempting these goods “from so much of the duty of excise leviable thereon as is in excess of the duty specified in the corresponding entry in Col. 5” of the Table annexed to the Notification. Prior to November, 1979, the assessee submit-ted classification list and paid excise duty on the basis that the Notification dated 1.8.1974 granted partial exemption only in respect of basic excise duty levied under the Central Excise & Salt Act, 1944 and did not claim any such exemption in re-spect of special duty of excise. On 9th of September, 1979, the assessee while submitting its classification list, contended that by reason of the Notification dated 1.8.1974, the assessee was exempted from payment not only in respect of basic excise duty levied under the Central Excise & Salt Act, 1944 but also in respect of special duty of excise levied under the relevant Finance Acts, because the language used in this Notification was not restrictive and it referred generally to “duty of excise” without any qualification and it therefore covered all duties of excise whether levied under the Central Excise & Salt Act, 1944 or under any other Central enactment.
Held:
(1) Both these notifications, as the opening part shows, are issued under Rule 8(1) of the Central Excise Rules, 1944 and since the definition of ‘duty’ in Rule 2, clause (v) must neces-sarily be projected in Rule 8(1) and the expression ‘duty of excise’ in Rule 8(1) must be read in the light of that defini-tion, the same expression used in these two notifications issued under Rule 8(1) must also be interpreted in the same sense, namely, duty of excise payable under the Central Excises and Salt Act, 1944 and the exemption granted under both these notifica-tions must be regarded as limited only to such duty of excise. (Para 7)
(2) Merely because, as a matter of drafting, the ‘Central Gov-ernment has in some notifications specifically referred to the excise duty in respect of which exemption is granted as ‘duty of excise’ leviable under the Central Excises and Salt Act, 1944, it does not follow that in the absence of such words of specificity, the expression ‘duty of excise’ standing by itself must be read as referring to all duties of excise. It is not uncommon to find that she legislature sometimes, with a view to making its inten-tion clear beyond doubt, uses language ex abundanti cautela though it may not be strictly necessary and even without it the same intention can be spelt out as a matter of judicial construc-tion and this would be more so in case of subordinate legislation by the executive. (Para 7)
(3) It is obvious that when a notification granting exemption from duty of excise is issued by the Central Government in exer-cise of the power under Rule 8(1) simpliciter, without anything more, it must, by reason of the definition of ‘duty’ contained in Rule 2 clause (v) which according to the well recognised canons of construction would be projected in Rule 8(1), be read as granting exemption only in respect of duty of excise payable under the Central Excises and Salt Act, 1944. Undoubtedly, by reason of sub-section (4) of Section 32 of the Finance Act, 1979 and similar provision in the other Finance Acts, Rule 8(1) would become applicable empowering the Central Government to grant exemption from payment of special deity of excise, but when the Central Government exercises this power, it would be doing so under Rule 8 (1 read with sub-section (4) of Section 32 or other similar provision. The reference to the source of power in such a case would not be just to Rule 8 ( 1), since it does not of its own force and on its own language apply to granting of exemption in respect of special duty of excise, but the reference would have to be to Rule 8(1) read with sub-section (4) of Section 32 or other similar provision. (Para 9)
(4) Where a notification granting exemption is issued only under sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 without reference to any other statute in making the provisions if the Central Excises and Salt Act, 1944 aid the Rules made thereunder applicable that the levy and collection of special auxiliary or any other kind of excise duty levied under such statute, the exemption must be read as limited to the duty of excise payable under the Central Excises and Salt Act, 1944 and cannot cover such special, auxiliary or other kind of duty of excise.(Para 9)
JUDGEMENT:
BHAGWATI, C.J.:
1. These appeals and writ petition raise a short question of the construction of the expression ‘duty of excise’ employed in two notifications issued by the Government of India under subrule (1) of Rule 8 of’ the Central Excise Rules, 1944, one bearing No. 123/74-C.E. dated August 1, 1974 and the other bearing No. 27,/81-C.E. dated March 1, 1981. The question is whether this expression is limited in its connotation only to basic duty of excise levied under the Central Excises and Salt Act, 1944 or it also covers special duty of excise levied under various Finance Bills and Acts, additional duty of excise levied under the Addi-tional Duty of Excise (Goods of Special Importance) Act, 1957 and any other kind of duty of excise levied under a Central enact-ment. If this question is decided in favour of the assessee-and it is held,accepting the contention of the assessee, that the expression ‘duty of excise’ in the two notifications is not confined only to the basic duty of excise levied under the Central Excises old Salt Act, 1944 but also comprises special duty of excise. additional duty of excise or any other kind of duty of excise, a further contention is raised on behalf of the assessee challenging the constitutional validity of the Central Excise Laws (Amendment and Validation) Act, 1982 by which Parlia-ment sought to lay down certain statutory rules for interpreta-tion for arriving at the true meaning and content of the expres-sion ‘duty of excise’ or, the notifications issued under sub-rule (1) of Rule 8 of the Central Excise.- Rules, 1944 and which consequentially had the effect of restricting the meaning and connotation of the expression ‘duty of excise’ in the two notifi-cations in question to basic duty of excise levied tinder the Central Excises and Salt Act, 1944. The facts giving rise to these appeals and writ petition are few and may be briefly stated as fellows.
2. The assessee in these appeals and writ Petition is a limited company which manufactures tyres. The manufacture of tyres is subject to duty of excise under the Central Excises and Salt Act, 1944. Section 3 sub-section (1) of this Act provides that there shall be levied and collected in such manner as may be prescribed by Rules made under the Act duties of excise on all excisable goods other than salt which are produced and manufactured in India as and at the rates set forth in the First Schedule. The First Schedule enumerates various items of goods which are liable to duty of excise and also sets forth the rate at which the duty of excise shall be charged on those goods. Item 16 in the First Schedule reads : “Tyres and Tubes” and the manufacture of tyres is therefore liable to excise duty at the rates set forth in the First Schedule. Section 37 of the Act confers power on the Central Government to make rules for carrying into effect the purposes of the Act and in exercise of this power the Central Government has made the Central Excise Rules, 1944. Rule 8 of these Rules is material for the determination of the question of interpretation which arises in these appeals and writ petition and we may therefore reproduce it in extenso :
8. Power to authorise exemption from duty in special cases.-(1) The Central Government may from time to time, by notification in the official Gazette, exempt (subject to such conditions as may be specified in the notification) any excis-able goods from the whole or any part of duty leviable on such goods.
(2) The Central Board of Excise and Customs may by special order in each case exempt from the payment of duty, under circumstances of an exceptional nature, any excisable goods.
The word “duty” for the purposes for these Rules is defined in clause (v) of Rule 2 to mean “the duty payable under Section 3 of the Act” and obviously therefore the exemption which the Central Government can grant by issuing notification under sub-rule (1) of Rule 8 can only be from the whole or any part of the duty of excise payable under Section 3 of the Central Excises and Salt Act, 1944.
3. It seems that the Central Government issued notifications from time to time under sub-rule (1) ‘of Rule 8 exempting various categories of excisable goods from the whole or any part of the excise duty leviable on such goods. So far as tyres are con-cerned notification bearing No. 123/74-C.E. dated August 1, 1974 was issued by the Central Government exempting tyres for motor vehicles from a part of the excise duty leviable thereon and since it is this notification which inter alia falls for con-struction, it would be desirable to set it out in full
No. 123/74-C.E. dated August 1, 1974
In the exercise of the powers conferred by sub-rule (1 ) of Rule 8 of the Central Excise Rules, 1944, the Central Govern-ment hereby exempts tyres for motor vehicles falling under sub-item (1) of item No. 16 of the First Schedule to the Cen-tral Excises and Salt Act, 1944 (1 of 1944), from so much of the duty of excise leviable thereon as is in excess of fifty-five per cent ad valorem.
Subsequently, another Notification bearing No. 27/81-C.E. dated March 1, 1981 was issued by the Central Government in respect of tyres for two-wheeled and three-wheeled motor vehicles, power cycle power cycled rickshaws, tractors and traitors exempting these goods “from so much of the duty of excise leviable thereon as is in excess of the duty specified in the corresponding entry in col. 5” of the Table annexed to this notification.
4. Now since 1963 special duty of excise was levied inter alia on manufacture of tyres from year to year up to 1971 by various Finance Acts passed from time to time. The levy of special duty of excise was discontinued from 1972 until 1978 when it was again revived by Finance Act, 1978. Thereafter, it continued to be levied from year to year right up to the period with which we are concerned in the present appeals and writ petition. The provisions levying special duty of excise in the various Finance Acts were in identical terms and it would therefore be suffi-cient if we reproduce the relevant provision in only one of the finance Acts. We propose to refer to the Finance , Act, 1979 since that is the Finance Act which was in operation when the present controversy in regard to the interpretation of the ex-pression ‘duty of excise’ arose between the assessee and the revenue. Section 32 of the Finance Act, 1979 provided as follows
32. Special Duties of Excise.-(1) In the case of goods chargeable with a duty of excise under the Central Excises Act as amended from time to time, read with any notification for the time being in force issued by the Central Government in relation to the duty so chargeable there shall be levied and collected a special duty of excise equal to live per cent of the amount so chargeable on such goods.
(2) Sub-section (1) shall cease to have effect after the 31st day of March, 1980, except as respects things done or omitted to be done before such cesser ; and section 6 of the General Clauses Act, 1897, shall apply upon such cesser as if the said sub-section had then been repealed by a Central Act.
(3) The Special duties of excise referred to in sub-section (1) shall be in addition to any duties of excise chargeable on such g under the Central Excises Act, or any other law for the tune being in force.
(4) The provisions of the Central Excises Act and the rules made thereunder, inclusion those relating to refunds and exemp-tions from duties, shall, as far as may be, apply in relation to the levy and collection of the special duties of excise leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of excise on such goods under that Act or those rules as the case may be.
The Finance Acts from 1973 to 1976 also levied auxiliary excise duty on various categories of excisable goods including tyres but the levy of auxiliary excise duty was discontinued with effect from 1977 and we are, therefore, not concerned with it so far as the present appeals and writ petition are concerned.
5. Prior to November 9, 1979 the assessee submitted classifica-tion list in terms of Rule 173-B of the Central Excise Rules, 1944, and paid excise duty on the basis that the notification dated August 1, 1974 granted partial exemption only in respect of basic excise duty levied under the Central Excises and Salt Act, 1944 and did not claim any such exemption in respect of special duty of excise. However, on November 9, 1979 the assessee, while submitting its classification list contended that by reason of the notification dated August 1, 1974 the assessee was exempted from payment not only in respect of basic excise duty levied under the Central Excises and Salt Act, 1944 but also in respect of special duty of excise levied under the relevant Finance Acts, because the language used in this notification was not restric-tive and it referred generally to ‘duty of excise’ without any qualification and it therefore covered all duties of excise whether levied under the Central Excises and Salt Act, 1944 or under any other Central enactment. This contention was advanced by the assessee in relation to the period from November 9, 1979 to October (sic) 1982. The Assistant Collector of Excise howev-er, rejected this contention and held that the term ‘duty of excise’ in the notification dated August 1, 1974 referred merely to the basic duty of excise levied under the Central Excises and Salt Act, 1944 and the exemption granted under that notification was not available in respect of special duty of excise levied under the Finance Acts. The asses thereupon fled a writ petition in the Delhi High Court challenging the order of the, Assistant Collector of Excise. During the pendency of this writ petition, the notification dated March 1, 1981 was issued by the Central Government and the assessee was therefore constrained to amend the writ petition so as to bring the question of interpretation of this notification also before the . The Delhi High Court by a judgment delivered on August 6, 1982 upheld the contention of the assessee and took the view that the expression ‘duty of excise’ in the two notifications dated August 1, 1974 and March 1, 1981 included not merely basic duty of excise levied under the Central Excises and Salt,Act, 1944 but also special duty of excise levied under the various Finance Acts and any other duty or duties of excise levied under the Central enactment. The Central Govern-ment was of the view that the Delhi High Court’s judgment was erroneous and it accordingly preferred the present appeals after obtaining special leave from this Court. Meanwhile, Parliament also enacted the Central Excise Laws (Amendment and Validation) Act, 1982 laying down statutory rules which should guide the court in interpreting notifications granting exemption from payment of duty of excise and prescribing the conditions on which a notification granting exemption from payment of duty of excise can be construed as applicable to duty of excise levied under any Central law making the provisions of the Central Excises and Salt Act, 1944 and the Rules made thereunder applicable to the levy and collection of duty of excise under such Central law. Since this enactment had the effect of limiting the interpretation of the expression ‘duty of excise in the two notifications dated August 1, 1974 and March 1, 1981 to the basic duty of excise levied under Central Excises and Salt Act, 1944 and excluding from its coverage special duty of excise levied under various Finance Acts, the assessee filed the present writ petition chal-lenging the constitutional validity of this enactment. That is how the present appeals and writ petition have come up for hear-ing before us.
6. The first question that arises for consideration on these facts is as to what is the true import of the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981. It is only if this expression is held to include duties of excise leviable not only under the Central Excises and Salt Act, 1944 but also under any other enactments that the question would arise whether the Central Laws (Amendment and Validation) Act, 1982 is constitutionally invalid. We, therefore, asked the learned counsel appearing on behalf of the parties to confine their arguments only to the first question of interpretation of the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981.
7. Both these notifications, as the opening part shows, are issued under Rule 8(1) of the Central Excise Rules, 1944 and since the definition of ‘duty’ in Rule 2, clause (v) must neces-sarily be projected in Rule 8(1) and the expression ‘duty of excise’ in Rule 8(1) must be read in the light of that defini-tion, the same expression used in these two notifications issued under Rule 8(1) must also be interpreted in the same sense, namely, duty of excise payable under the Central Excises and Salt Act, 1944 and the exemption granted under both these notifica-tions must be regarded as limited only to such duty of excise. But the respondents contended that the expression ‘duty of ex-cise’ was one of large amplitude and in the absence of any re-strictive or limitative words indicating that it was intended to refer only to duty of excise leviable under the Central Excise and Salt Act, 1944, it must be held to cover all duties of excise whether leviable under the Central Excises and Salt Act, 1944 or under any other enactment. The respondents sought to support this contention by pointing cut that whenever the Central Govern-ment wanted to confine the exemption granted under a notification to the duty of excise leviable under the Central Excises and Salt Act, 1944, the Central Government made its intention abundantly clear by using appropriate words of limitation such as “duty of excise leviable … under Section 3 of the Central Excises and Salt Act, 1944” or “duty of excise leviable … under the Central Excises and Salt Act, 1944” or “duty of excise leviable … under the said Act” as in the Notification No. CER-8(2)/’55-C.E. dated September 17, 1955, Notification No. 255/77-C.E. dated July 20, 1977, Notification No. CER-8(1)/55-C.E. dated September 2, 1955, Notification No. CER-8(9)/55-C.E. dated December 31, 1955, No-tification No. 95/61-C.E. dated April 1, 1961, Notification No. 23/55-C.E. dated April 29, 1955 and similar other notifications. But, here said the respondents, no such words of limitation are used in the two notifications in question and the expression ‘duty of excise’ must, therefore, be read according to its plain natural meaning as including all duties of excise, including special duty of excise and auxiliary duty of excise. Now, it is no doubt true that in these various notifications referred to above, the Central Government has, while granting exemption under Rule 8(1), used specified language indicating that the exemption, total or partial, granted under each such notification is in respect of excise duty leviable under the Central Excises and Salt Act, 1944. But, merely because, as a matter of drafting, the ‘Central Government has in some notifications specifically referred to the excise duty in respect of which exemption is granted as ‘duty of excise’ leviable under the Central Excises and Salt Act, 1944, it does not follow that in the absence of such words of specificity, the expression ‘duty of excise’ stand-ing by itself must be read as referring to all duties of excise. It is not uncommon to find that she legislature sometimes, with a view to making its intention clear beyond doubt, uses language ex abundanti cautela though it may not be strictly necessary and even without it the same intention can be spelt out as a matter of judicial construction and this would be more so in case of subordinate legislation by the executive. The officer drafting a particular piece of subordinate legislation in the Executive Department may employ words with a view to leaving no scope for possible doubt as to its intention or sometimes even for greater completeness, though these words may not add anything to the meaning and scope of the subordinate legislation. Here, in the present notifications. the words ‘duty of excise leviable under the Central Excises and Salt Act., 1944′ do not find a place as in the other notifications relied upon by the respondents. But, that does not necessarily lead the inference that the expression duty of excise’ in these notifications was intended to refer to all duties of excise including special and auxiliary duties of excise . ‘Re absence of these words does not absolve us from the obligation to interpret the expression ‘duty of excise’ in these notifications. We have still to construe this expression – what is its meaning and import – and that has to be done bearing in mind the context in which it occurs. We have already pointed out that these notifications having been issued under Rule 8 (1), the expression ‘duty of excise’ in these notifications must bear the same meaning which it has in Rule 8(1) and that meaning clearly is excise duty payable under the Central Excises and Salt Act, 1944 as envisaged in Rule 2 clause (v). It cannot in the circum-stances bear an extended meaning so as to include special excise duty and auxiliary excise duty.
8. Moreover, at the date when the first notification was issued, namely, August 1, 1974, there was no special duty of excise leviable on tyres. It came to be levied on tyres with effect from the financial year 1978 under various Finance Acts enacted from year to year. It is therefore difficult to under-stand how the expression ‘duty of excise’ in the notification dated August 1, 1974 could possibly be read as comprehending special duty of excise which did not exist at the date of this notification and came to be levied almost four years later. When special duty of excise was not in existence at the date of this notification, how could the Central Government, in issuing this notification, have intended to grant exemption from payment of special excise duty ? The presumption is that when.a notification granting exemption from payment of excise duty is issued by the Central Government under Rule 8(1), the Central Government would have applied its mind to the question whether exemption should be granted and if so, to what extent. And obviously that can only ‘be with reference to the duty of excise which is then leviable. The Central Government could not be presumed to have projected its mind into the future and granted exemption in respect of excise duty which may be levied in the future, without consider-ing the nature and extent of such duty and the, object and pur-pose for which such levy may be made and without taking into account the situation which may be prevailing then. It is only when a new duty of excise is levied, whether special duty of excise or auxiliary duty of excise or any other kind of duty of excise, that a question could arise whether any particular arti-cle should be exempted from payment of such duty of excise and’ the Central Government would then have to apply its mind to this question and having regard to the nature and extent of such Act of excise and the object and purpose for which it is levied and the economic situation including supply and demand position then prevailing, decide whether exemption from payment of such excise duty should be granted and if so, to what extent. It would be absured to suggest that by issuing the notification dated August 1, 1974 the Central Government intended to grant exemption not only in respect of excise duty then prevailing but also in respect of all future duties of excise which may be levied from time to time.
9. We have already pointed out, and this is one of the princi-pal arguments against the contention of the respondents, that by reason of the definition of “duty” in clause (v) of Rule 2 which must be read in Rule 8(1), the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981 must be construed as duty of excise payable under the Central Excises and Salt Act, 1944. The, respondents sought to combat this conclu-sion by relying on sub-section (4) of Section 32 of the Finance, Act, 1979 – there being an identical provision in each Finance Act levying special duty of excise – which provided that the provisions of the Central Excises and Salt Act, 1944 and the rules made thereunder including those relating to refunds and exemptions from duties shall, as far as may be, apply in relation to the levy and collection of special duty of excise as they apply in relation to the levy and collection of tile duty of excise under the Central Excises and Salt Act, 1944. It was urged on behalf of the respondents that by reason of this provi-sion, Rule 8 (1) relating to exemption from duty of excise became applicable in relation to the levy and collection of special duty of excise and exemption from payment of special duty of excise could there – fore be granted by the Central Government under Rule 8(1) in the same manner in which it could be granted in relation to the duty of excise payable under the Central Excise and salt Act, 1944. The argument of the respondents based on this premise was that the reference to Rule 8(1) as the source of the power under which the notifications dated August 1, 1974 and March 1, 1981 were issued could not therefore be relied upon as indicating that the duty of excise from which exemption was granted under these, two notifications was limited only to the duty of excise payable under the Central Excise and Salt Act, 1944 and the expression ‘duty of excise’ in these two notifica-tions could legitimately be construed as comprehending special duty of excise. This argument is, in our opinion, not well founded and cannot be sustained. It is obvious that when a notification granting exemption from duty of excise is issued by the Central Government in exercise of the power under Rule 8(1) simpliciter, without anything more, it must, by reason of the definition of ‘duty’ contained in Rule 2 clause (v) which accord-ing to the well recognised canons of construction would be pro-jected in Rule 8(1), be read as granting exemption only in re-spect of duty of excise payable under the Central Excises and Salt Act, 1944. Undoubtedly, by reason of sub-section (4) of Section 32 of the Finance Act, 1979 and similar provision in the other Finance Acts, Rule 8(1) would become applicable empowering the Central Government to grant exemption from payment of special deity of excise, but when the Central Government exercises this power, it would be doing so under Rule 8 (1 read with sub-section (4) of Section 32 or other similar provision. The reference to the source of power in such a case would not be just to Rule 8 ( 1), since it does not of its own force and on its own language apply to granting of exemption in respect of special duty of excise, but the reference would have to be to Rule 8(1) read with sub-section (4) of Section 32 or other similar provision. It is significant to note that during, all these years, wherever exemp-tion is sought to be granted by the Central Government from pay-ment of special duty of excise or additional duty of excise, the recital of the source of power in the notification granting exemption has invariably been to Rule 8(1) read with the relevant provision of the statute levying special duty of excise or addi-tional duty of excise, by which the provisions of the Central Excises and Salt Act, 1944 and the rules made thereunder includ-ing those relating to exemption from duty are made applicable. Take for example, the Notification bearing No. 63/78 dated August 1, 1978 where exemption is granted in respect of certain excis-able goods “from the whole of the special duty of excise leviable thereon under sub clause (1) of Clause 37 of the Finance Bill, 1978”. The source of the power recited in this notification is “sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with sub-clause (,5) of Clause 37 of the Finance-Bill, 1978”. So also in the Notification bearing, No. 29,/’79 dated March 1, 1979 exempting unmanufactured tobacco “from the whole of the duty of excise leviable thereon both under the Central Excises and Salt Act, 1944 and Additional Duties of Excise (Goods of Special Importance) Act, 1957”, the reference to the source of power mentioned in the opening part of the notification is “sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with sub-section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957”. The respondents have in fact produced several notifications ranting exemption in respect of special duty of excise or additional duty of excise and in each of these notifications, we find that the source of power is described as sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with the relevant provision of the sta-tute levying special duty of excise or additional duty of excise by which the provisions of the Central Excises and Salt Act, 1944 and the Rules made thereunder including those relating to exemp-tion from duty are made applicable. Moreover the exemption -ranted under all these Notifications specifically refers to special duty of excise or additional duty of excise, as the case may be. It is therefore, clear that where a notification granting exemption is issued only under sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 without reference to any other statute in making the provisions if the Central Excises and Salt Act, 1944 aid the Rules made thereunder applicable that the levy and collection of special auxiliary or any other kind of excise duty levied under such statute, the exemption must be read as limited to the duty of excise payable under the Central Excises and Salt Act, 1944 and cannot cover such special, auxiliary or other kind of duty of excise. The notifications in the present case were issued tinder sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 simpliciter without reference to any other statute and hence the exemption granted under these two notifications must be construed as limited only to the duty of excise payable under the Central Excises and Salt Act, 1944.
10. We may incidentally mention that in the appeals a question of interpretation was also raised in regard to the Notification bearing No. 249/67 dated November 8, 1967 exempting tyres for tractors from “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excises and Salt Act, 1944 as is in excess of 15 per cent”. The argument of the respondents in the appeals was that the exemption granted under this notifi-cation was not limited to the duty of excise payable under the Central Excises and Salt Act, 1944 but it also extended to spe-cial duty of excise, additional duty c:f excise and auxiliary duty of excise- leviable under other enactments. This amendment plainly runs counter to the very language of this notification. It is obvious that the exemption granted under this notification is in respect of “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excise and Salt Act, 1944 as is in excess of 15 per cent” and these words describing the nature and extent of the exemption on their plain natural con-struction, clearly indicate that the exemption is in respect of duty of excise leviable under the Central Excise and Salt Act. 1944 and does not cover any other kinds of duty of excise. No more discussion is necessary in regard to this question beyond merely referring to the language of this notification.
11. On the above view taken by us we must hold that the Central Excise Laws (Amendment and Validation) Act. 1982 is merely de-claratory of the existing law and hence its constitutional valid-ity cannot be assailed.
12. We accordingly allow the appeals dismiss the writ petition. We set aside the judgment of the High Court and hold that under the notifications dated November 8, 1967. August 1, 1974 and March 1-1981 the respondents in the appeals and the petitioners in the writ petitioners are entitled to exemption only in re-spect of the basic duty of excise leviable under the Central Excises and Salt Act, 1944 and are not entitled to claim any exemption in respect of special duty of excise or additional duty of excise or auxiliary duty of excise. The respondents in the anneals and the petitioners in the writ petition will pay the costs of the Union of India.
Appeal allowed.
1. These appeals and writ petition raise a short question of the construction of the expression ‘duty of excise’ employed in two notifications issued by the Government of India under subrule (1) of Rule 8 of’ the Central Excise Rules, 1944, one bearing No. 123/74-C.E. dated August 1, 1974 and the other bearing No. 27,/81-C.E. dated March 1, 1981. The question is whether this expression is limited in its connotation only to basic duty of excise levied under the Central Excises and Salt Act, 1944 or it also covers special duty of excise levied under various Finance Bills and Acts, additional duty of excise levied under the Addi-tional Duty of Excise (Goods of Special Importance) Act, 1957 and any other kind of duty of excise levied under a Central enact-ment. If this question is decided in favour of the assessee-and it is held,accepting the contention of the assessee, that the expression ‘duty of excise’ in the two notifications is not confined only to the basic duty of excise levied under the Central Excises old Salt Act, 1944 but also comprises special duty of excise. additional duty of excise or any other kind of duty of excise, a further contention is raised on behalf of the assessee challenging the constitutional validity of the Central Excise Laws (Amendment and Validation) Act, 1982 by which Parlia-ment sought to lay down certain statutory rules for interpreta-tion for arriving at the true meaning and content of the expres-sion ‘duty of excise’ or, the notifications issued under sub-rule (1) of Rule 8 of the Central Excise.- Rules, 1944 and which consequentially had the effect of restricting the meaning and connotation of the expression ‘duty of excise’ in the two notifi-cations in question to basic duty of excise levied tinder the Central Excises and Salt Act, 1944. The facts giving rise to these appeals and writ petition are few and may be briefly stated as fellows.
2. The assessee in these appeals and writ Petition is a limited company which manufactures tyres. The manufacture of tyres is subject to duty of excise under the Central Excises and Salt Act, 1944. Section 3 sub-section (1) of this Act provides that there shall be levied and collected in such manner as may be prescribed by Rules made under the Act duties of excise on all excisable goods other than salt which are produced and manufactured in India as and at the rates set forth in the First Schedule. The First Schedule enumerates various items of goods which are liable to duty of excise and also sets forth the rate at which the duty of excise shall be charged on those goods. Item 16 in the First Schedule reads : “Tyres and Tubes” and the manufacture of tyres is therefore liable to excise duty at the rates set forth in the First Schedule. Section 37 of the Act confers power on the Central Government to make rules for carrying into effect the purposes of the Act and in exercise of this power the Central Government has made the Central Excise Rules, 1944. Rule 8 of these Rules is material for the determination of the question of interpretation which arises in these appeals and writ petition and we may therefore reproduce it in extenso :
8. Power to authorise exemption from duty in special cases.-(1) The Central Government may from time to time, by notification in the official Gazette, exempt (subject to such conditions as may be specified in the notification) any excis-able goods from the whole or any part of duty leviable on such goods.
(2) The Central Board of Excise and Customs may by special order in each case exempt from the payment of duty, under circumstances of an exceptional nature, any excisable goods.
The word “duty” for the purposes for these Rules is defined in clause (v) of Rule 2 to mean “the duty payable under Section 3 of the Act” and obviously therefore the exemption which the Central Government can grant by issuing notification under sub-rule (1) of Rule 8 can only be from the whole or any part of the duty of excise payable under Section 3 of the Central Excises and Salt Act, 1944.
3. It seems that the Central Government issued notifications from time to time under sub-rule (1) ‘of Rule 8 exempting various categories of excisable goods from the whole or any part of the excise duty leviable on such goods. So far as tyres are con-cerned notification bearing No. 123/74-C.E. dated August 1, 1974 was issued by the Central Government exempting tyres for motor vehicles from a part of the excise duty leviable thereon and since it is this notification which inter alia falls for con-struction, it would be desirable to set it out in full
No. 123/74-C.E. dated August 1, 1974
In the exercise of the powers conferred by sub-rule (1 ) of Rule 8 of the Central Excise Rules, 1944, the Central Govern-ment hereby exempts tyres for motor vehicles falling under sub-item (1) of item No. 16 of the First Schedule to the Cen-tral Excises and Salt Act, 1944 (1 of 1944), from so much of the duty of excise leviable thereon as is in excess of fifty-five per cent ad valorem.
Subsequently, another Notification bearing No. 27/81-C.E. dated March 1, 1981 was issued by the Central Government in respect of tyres for two-wheeled and three-wheeled motor vehicles, power cycle power cycled rickshaws, tractors and traitors exempting these goods “from so much of the duty of excise leviable thereon as is in excess of the duty specified in the corresponding entry in col. 5” of the Table annexed to this notification.
4. Now since 1963 special duty of excise was levied inter alia on manufacture of tyres from year to year up to 1971 by various Finance Acts passed from time to time. The levy of special duty of excise was discontinued from 1972 until 1978 when it was again revived by Finance Act, 1978. Thereafter, it continued to be levied from year to year right up to the period with which we are concerned in the present appeals and writ petition. The provisions levying special duty of excise in the various Finance Acts were in identical terms and it would therefore be suffi-cient if we reproduce the relevant provision in only one of the finance Acts. We propose to refer to the Finance , Act, 1979 since that is the Finance Act which was in operation when the present controversy in regard to the interpretation of the ex-pression ‘duty of excise’ arose between the assessee and the revenue. Section 32 of the Finance Act, 1979 provided as follows
32. Special Duties of Excise.-(1) In the case of goods chargeable with a duty of excise under the Central Excises Act as amended from time to time, read with any notification for the time being in force issued by the Central Government in relation to the duty so chargeable there shall be levied and collected a special duty of excise equal to live per cent of the amount so chargeable on such goods.
(2) Sub-section (1) shall cease to have effect after the 31st day of March, 1980, except as respects things done or omitted to be done before such cesser ; and section 6 of the General Clauses Act, 1897, shall apply upon such cesser as if the said sub-section had then been repealed by a Central Act.
(3) The Special duties of excise referred to in sub-section (1) shall be in addition to any duties of excise chargeable on such g under the Central Excises Act, or any other law for the tune being in force.
(4) The provisions of the Central Excises Act and the rules made thereunder, inclusion those relating to refunds and exemp-tions from duties, shall, as far as may be, apply in relation to the levy and collection of the special duties of excise leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of excise on such goods under that Act or those rules as the case may be.
The Finance Acts from 1973 to 1976 also levied auxiliary excise duty on various categories of excisable goods including tyres but the levy of auxiliary excise duty was discontinued with effect from 1977 and we are, therefore, not concerned with it so far as the present appeals and writ petition are concerned.
5. Prior to November 9, 1979 the assessee submitted classifica-tion list in terms of Rule 173-B of the Central Excise Rules, 1944, and paid excise duty on the basis that the notification dated August 1, 1974 granted partial exemption only in respect of basic excise duty levied under the Central Excises and Salt Act, 1944 and did not claim any such exemption in respect of special duty of excise. However, on November 9, 1979 the assessee, while submitting its classification list contended that by reason of the notification dated August 1, 1974 the assessee was exempted from payment not only in respect of basic excise duty levied under the Central Excises and Salt Act, 1944 but also in respect of special duty of excise levied under the relevant Finance Acts, because the language used in this notification was not restric-tive and it referred generally to ‘duty of excise’ without any qualification and it therefore covered all duties of excise whether levied under the Central Excises and Salt Act, 1944 or under any other Central enactment. This contention was advanced by the assessee in relation to the period from November 9, 1979 to October (sic) 1982. The Assistant Collector of Excise howev-er, rejected this contention and held that the term ‘duty of excise’ in the notification dated August 1, 1974 referred merely to the basic duty of excise levied under the Central Excises and Salt Act, 1944 and the exemption granted under that notification was not available in respect of special duty of excise levied under the Finance Acts. The asses thereupon fled a writ petition in the Delhi High Court challenging the order of the, Assistant Collector of Excise. During the pendency of this writ petition, the notification dated March 1, 1981 was issued by the Central Government and the assessee was therefore constrained to amend the writ petition so as to bring the question of interpretation of this notification also before the . The Delhi High Court by a judgment delivered on August 6, 1982 upheld the contention of the assessee and took the view that the expression ‘duty of excise’ in the two notifications dated August 1, 1974 and March 1, 1981 included not merely basic duty of excise levied under the Central Excises and Salt,Act, 1944 but also special duty of excise levied under the various Finance Acts and any other duty or duties of excise levied under the Central enactment. The Central Govern-ment was of the view that the Delhi High Court’s judgment was erroneous and it accordingly preferred the present appeals after obtaining special leave from this Court. Meanwhile, Parliament also enacted the Central Excise Laws (Amendment and Validation) Act, 1982 laying down statutory rules which should guide the court in interpreting notifications granting exemption from payment of duty of excise and prescribing the conditions on which a notification granting exemption from payment of duty of excise can be construed as applicable to duty of excise levied under any Central law making the provisions of the Central Excises and Salt Act, 1944 and the Rules made thereunder applicable to the levy and collection of duty of excise under such Central law. Since this enactment had the effect of limiting the interpretation of the expression ‘duty of excise in the two notifications dated August 1, 1974 and March 1, 1981 to the basic duty of excise levied under Central Excises and Salt Act, 1944 and excluding from its coverage special duty of excise levied under various Finance Acts, the assessee filed the present writ petition chal-lenging the constitutional validity of this enactment. That is how the present appeals and writ petition have come up for hear-ing before us.
6. The first question that arises for consideration on these facts is as to what is the true import of the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981. It is only if this expression is held to include duties of excise leviable not only under the Central Excises and Salt Act, 1944 but also under any other enactments that the question would arise whether the Central Laws (Amendment and Validation) Act, 1982 is constitutionally invalid. We, therefore, asked the learned counsel appearing on behalf of the parties to confine their arguments only to the first question of interpretation of the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981.
7. Both these notifications, as the opening part shows, are issued under Rule 8(1) of the Central Excise Rules, 1944 and since the definition of ‘duty’ in Rule 2, clause (v) must neces-sarily be projected in Rule 8(1) and the expression ‘duty of excise’ in Rule 8(1) must be read in the light of that defini-tion, the same expression used in these two notifications issued under Rule 8(1) must also be interpreted in the same sense, namely, duty of excise payable under the Central Excises and Salt Act, 1944 and the exemption granted under both these notifica-tions must be regarded as limited only to such duty of excise. But the respondents contended that the expression ‘duty of ex-cise’ was one of large amplitude and in the absence of any re-strictive or limitative words indicating that it was intended to refer only to duty of excise leviable under the Central Excise and Salt Act, 1944, it must be held to cover all duties of excise whether leviable under the Central Excises and Salt Act, 1944 or under any other enactment. The respondents sought to support this contention by pointing cut that whenever the Central Govern-ment wanted to confine the exemption granted under a notification to the duty of excise leviable under the Central Excises and Salt Act, 1944, the Central Government made its intention abundantly clear by using appropriate words of limitation such as “duty of excise leviable … under Section 3 of the Central Excises and Salt Act, 1944” or “duty of excise leviable … under the Central Excises and Salt Act, 1944” or “duty of excise leviable … under the said Act” as in the Notification No. CER-8(2)/’55-C.E. dated September 17, 1955, Notification No. 255/77-C.E. dated July 20, 1977, Notification No. CER-8(1)/55-C.E. dated September 2, 1955, Notification No. CER-8(9)/55-C.E. dated December 31, 1955, No-tification No. 95/61-C.E. dated April 1, 1961, Notification No. 23/55-C.E. dated April 29, 1955 and similar other notifications. But, here said the respondents, no such words of limitation are used in the two notifications in question and the expression ‘duty of excise’ must, therefore, be read according to its plain natural meaning as including all duties of excise, including special duty of excise and auxiliary duty of excise. Now, it is no doubt true that in these various notifications referred to above, the Central Government has, while granting exemption under Rule 8(1), used specified language indicating that the exemption, total or partial, granted under each such notification is in respect of excise duty leviable under the Central Excises and Salt Act, 1944. But, merely because, as a matter of drafting, the ‘Central Government has in some notifications specifically referred to the excise duty in respect of which exemption is granted as ‘duty of excise’ leviable under the Central Excises and Salt Act, 1944, it does not follow that in the absence of such words of specificity, the expression ‘duty of excise’ stand-ing by itself must be read as referring to all duties of excise. It is not uncommon to find that she legislature sometimes, with a view to making its intention clear beyond doubt, uses language ex abundanti cautela though it may not be strictly necessary and even without it the same intention can be spelt out as a matter of judicial construction and this would be more so in case of subordinate legislation by the executive. The officer drafting a particular piece of subordinate legislation in the Executive Department may employ words with a view to leaving no scope for possible doubt as to its intention or sometimes even for greater completeness, though these words may not add anything to the meaning and scope of the subordinate legislation. Here, in the present notifications. the words ‘duty of excise leviable under the Central Excises and Salt Act., 1944′ do not find a place as in the other notifications relied upon by the respondents. But, that does not necessarily lead the inference that the expression duty of excise’ in these notifications was intended to refer to all duties of excise including special and auxiliary duties of excise . ‘Re absence of these words does not absolve us from the obligation to interpret the expression ‘duty of excise’ in these notifications. We have still to construe this expression – what is its meaning and import – and that has to be done bearing in mind the context in which it occurs. We have already pointed out that these notifications having been issued under Rule 8 (1), the expression ‘duty of excise’ in these notifications must bear the same meaning which it has in Rule 8(1) and that meaning clearly is excise duty payable under the Central Excises and Salt Act, 1944 as envisaged in Rule 2 clause (v). It cannot in the circum-stances bear an extended meaning so as to include special excise duty and auxiliary excise duty.
8. Moreover, at the date when the first notification was issued, namely, August 1, 1974, there was no special duty of excise leviable on tyres. It came to be levied on tyres with effect from the financial year 1978 under various Finance Acts enacted from year to year. It is therefore difficult to under-stand how the expression ‘duty of excise’ in the notification dated August 1, 1974 could possibly be read as comprehending special duty of excise which did not exist at the date of this notification and came to be levied almost four years later. When special duty of excise was not in existence at the date of this notification, how could the Central Government, in issuing this notification, have intended to grant exemption from payment of special excise duty ? The presumption is that when.a notification granting exemption from payment of excise duty is issued by the Central Government under Rule 8(1), the Central Government would have applied its mind to the question whether exemption should be granted and if so, to what extent. And obviously that can only ‘be with reference to the duty of excise which is then leviable. The Central Government could not be presumed to have projected its mind into the future and granted exemption in respect of excise duty which may be levied in the future, without consider-ing the nature and extent of such duty and the, object and pur-pose for which such levy may be made and without taking into account the situation which may be prevailing then. It is only when a new duty of excise is levied, whether special duty of excise or auxiliary duty of excise or any other kind of duty of excise, that a question could arise whether any particular arti-cle should be exempted from payment of such duty of excise and’ the Central Government would then have to apply its mind to this question and having regard to the nature and extent of such Act of excise and the object and purpose for which it is levied and the economic situation including supply and demand position then prevailing, decide whether exemption from payment of such excise duty should be granted and if so, to what extent. It would be absured to suggest that by issuing the notification dated August 1, 1974 the Central Government intended to grant exemption not only in respect of excise duty then prevailing but also in respect of all future duties of excise which may be levied from time to time.
9. We have already pointed out, and this is one of the princi-pal arguments against the contention of the respondents, that by reason of the definition of “duty” in clause (v) of Rule 2 which must be read in Rule 8(1), the expression ‘duty of excise’ in the notifications dated August 1, 1974 and March 1, 1981 must be construed as duty of excise payable under the Central Excises and Salt Act, 1944. The, respondents sought to combat this conclu-sion by relying on sub-section (4) of Section 32 of the Finance, Act, 1979 – there being an identical provision in each Finance Act levying special duty of excise – which provided that the provisions of the Central Excises and Salt Act, 1944 and the rules made thereunder including those relating to refunds and exemptions from duties shall, as far as may be, apply in relation to the levy and collection of special duty of excise as they apply in relation to the levy and collection of tile duty of excise under the Central Excises and Salt Act, 1944. It was urged on behalf of the respondents that by reason of this provi-sion, Rule 8 (1) relating to exemption from duty of excise became applicable in relation to the levy and collection of special duty of excise and exemption from payment of special duty of excise could there – fore be granted by the Central Government under Rule 8(1) in the same manner in which it could be granted in relation to the duty of excise payable under the Central Excise and salt Act, 1944. The argument of the respondents based on this premise was that the reference to Rule 8(1) as the source of the power under which the notifications dated August 1, 1974 and March 1, 1981 were issued could not therefore be relied upon as indicating that the duty of excise from which exemption was granted under these, two notifications was limited only to the duty of excise payable under the Central Excise and Salt Act, 1944 and the expression ‘duty of excise’ in these two notifica-tions could legitimately be construed as comprehending special duty of excise. This argument is, in our opinion, not well founded and cannot be sustained. It is obvious that when a notification granting exemption from duty of excise is issued by the Central Government in exercise of the power under Rule 8(1) simpliciter, without anything more, it must, by reason of the definition of ‘duty’ contained in Rule 2 clause (v) which accord-ing to the well recognised canons of construction would be pro-jected in Rule 8(1), be read as granting exemption only in re-spect of duty of excise payable under the Central Excises and Salt Act, 1944. Undoubtedly, by reason of sub-section (4) of Section 32 of the Finance Act, 1979 and similar provision in the other Finance Acts, Rule 8(1) would become applicable empowering the Central Government to grant exemption from payment of special deity of excise, but when the Central Government exercises this power, it would be doing so under Rule 8 (1 read with sub-section (4) of Section 32 or other similar provision. The reference to the source of power in such a case would not be just to Rule 8 ( 1), since it does not of its own force and on its own language apply to granting of exemption in respect of special duty of excise, but the reference would have to be to Rule 8(1) read with sub-section (4) of Section 32 or other similar provision. It is significant to note that during, all these years, wherever exemp-tion is sought to be granted by the Central Government from pay-ment of special duty of excise or additional duty of excise, the recital of the source of power in the notification granting exemption has invariably been to Rule 8(1) read with the relevant provision of the statute levying special duty of excise or addi-tional duty of excise, by which the provisions of the Central Excises and Salt Act, 1944 and the rules made thereunder includ-ing those relating to exemption from duty are made applicable. Take for example, the Notification bearing No. 63/78 dated August 1, 1978 where exemption is granted in respect of certain excis-able goods “from the whole of the special duty of excise leviable thereon under sub clause (1) of Clause 37 of the Finance Bill, 1978”. The source of the power recited in this notification is “sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with sub-clause (,5) of Clause 37 of the Finance-Bill, 1978”. So also in the Notification bearing, No. 29,/’79 dated March 1, 1979 exempting unmanufactured tobacco “from the whole of the duty of excise leviable thereon both under the Central Excises and Salt Act, 1944 and Additional Duties of Excise (Goods of Special Importance) Act, 1957”, the reference to the source of power mentioned in the opening part of the notification is “sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with sub-section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957”. The respondents have in fact produced several notifications ranting exemption in respect of special duty of excise or additional duty of excise and in each of these notifications, we find that the source of power is described as sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 read with the relevant provision of the sta-tute levying special duty of excise or additional duty of excise by which the provisions of the Central Excises and Salt Act, 1944 and the Rules made thereunder including those relating to exemp-tion from duty are made applicable. Moreover the exemption -ranted under all these Notifications specifically refers to special duty of excise or additional duty of excise, as the case may be. It is therefore, clear that where a notification granting exemption is issued only under sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 without reference to any other statute in making the provisions if the Central Excises and Salt Act, 1944 aid the Rules made thereunder applicable that the levy and collection of special auxiliary or any other kind of excise duty levied under such statute, the exemption must be read as limited to the duty of excise payable under the Central Excises and Salt Act, 1944 and cannot cover such special, auxiliary or other kind of duty of excise. The notifications in the present case were issued tinder sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 simpliciter without reference to any other statute and hence the exemption granted under these two notifications must be construed as limited only to the duty of excise payable under the Central Excises and Salt Act, 1944.
10. We may incidentally mention that in the appeals a question of interpretation was also raised in regard to the Notification bearing No. 249/67 dated November 8, 1967 exempting tyres for tractors from “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excises and Salt Act, 1944 as is in excess of 15 per cent”. The argument of the respondents in the appeals was that the exemption granted under this notifi-cation was not limited to the duty of excise payable under the Central Excises and Salt Act, 1944 but it also extended to spe-cial duty of excise, additional duty c:f excise and auxiliary duty of excise- leviable under other enactments. This amendment plainly runs counter to the very language of this notification. It is obvious that the exemption granted under this notification is in respect of “so much of the duty leviable thereon under item 16 of the First Schedule to the Central Excise and Salt Act, 1944 as is in excess of 15 per cent” and these words describing the nature and extent of the exemption on their plain natural con-struction, clearly indicate that the exemption is in respect of duty of excise leviable under the Central Excise and Salt Act. 1944 and does not cover any other kinds of duty of excise. No more discussion is necessary in regard to this question beyond merely referring to the language of this notification.
11. On the above view taken by us we must hold that the Central Excise Laws (Amendment and Validation) Act. 1982 is merely de-claratory of the existing law and hence its constitutional valid-ity cannot be assailed.
12. We accordingly allow the appeals dismiss the writ petition. We set aside the judgment of the High Court and hold that under the notifications dated November 8, 1967. August 1, 1974 and March 1-1981 the respondents in the appeals and the petitioners in the writ petitioners are entitled to exemption only in re-spect of the basic duty of excise leviable under the Central Excises and Salt Act, 1944 and are not entitled to claim any exemption in respect of special duty of excise or additional duty of excise or auxiliary duty of excise. The respondents in the anneals and the petitioners in the writ petition will pay the costs of the Union of India.
Appeal allowed.
