Statutory benefit under Central Excise law cannot be curtailed by a conflicting delegated rule; assessee succeeds.

Section 3A(4) of the Central Excise Act, 1944 confers a statutory right to re-fix annual capacity production, and that entitlement cannot be denied merely because Rule 96ZO(3) purports to bar the claim. The Tribunal applied the settled principle that a delegated rule cannot override or curtail a benefit granted by the parent statute. As the impugned orders rejected the request solely on the basis of the rule-based restriction, the denial was held contrary to the governing provision and unsustainable, with the issue decided in favour of the assessee.

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Issues: Whether the benefit of re-fixing annual capacity production under Section 3A(4) of the Central Excise Act, 1944 could be denied on the ground that Rule 96ZO(3) of the Central Excise Rules, 1944 barred the claim.

Analysis: The dispute turned on the interaction between the statutory entitlement under Section 3A(4) and the restriction contained in Rule 96ZO(3). The Tribunal applied the settled principle that where a rule conflicts with the parent statute, the statute prevails. Since the impugned orders rejected the request solely because the rule purported to bar the statutory benefit, the denial was contrary to the governing provision and the earlier Tribunal view followed in similar matters.

Conclusion: The denial of benefit under Section 3A(4) was unsustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: A delegated rule cannot curtail a substantive benefit conferred by the parent statute when the two are in conflict.

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