Section 38A preserves pending excise proceedings despite omission of Rule 96ZO(3), leaving abatement claims unaffected

Omission of Rule 96ZO(3) did not extinguish pending abatement proceedings because Section 38A of the Central Excise Act preserves the prior operation of amended, repealed, superseded or rescinded rules and protects rights, liabilities and proceedings arising under them. On that basis, proceedings already initiated under the omitted rule remained valid, and the challenge based solely on omission failed. The separate factual objection of non-compliance with the rule was also not accepted, so the abatement claim did not succeed.

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Issues: Whether omission of Rule 96ZO(3) of the Central Excise Rules, 1944 by Notification No. 6 of 2001 dated 01.03.2001 rendered pending abatement proceedings invalid and the impugned orders a nullity.

Analysis: The appellant's claim for abatement arose under Rule 96ZO(3), but the Court relied on the statutory effect of Section 38A of the Central Excise Act, 1944, inserted by Section 131 of the Finance Act, 2001. That provision preserves the previous operation of amended, repealed, superseded or rescinded rules and protects rights, obligations, liabilities and proceedings arising under them. On that basis, omission of Rule 96ZO(3) did not extinguish liabilities or invalidate proceedings already initiated, and the challenge based solely on omission was rejected. The factual challenge regarding non-compliance with the rule was also not accepted.

Conclusion: The omission of Rule 96ZO(3) did not affect the pending proceedings or the adjudication of the abatement claim, and the appellant was not entitled to relief.

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