Prospective effect of exemption notification leaves SSI benefit unavailable for the intervening period before reintroduction.

The reintroduction of SSI exemption for parts of revolver by Notification No. 47/2001-C.E. operated prospectively from 1-10-2001 and did not cover the intervening period from 1-4-2001 to 30-9-2001. Notification No. 8/2001-C.E. had withdrawn the exemption for goods falling under Chapter 93 from 1-4-2001, and the later notification contained no express retrospective effect. The budget speech and statutory scheme indicated a conscious withdrawal of the benefit for the gap period, and exemption notifications are ordinarily prospective unless expressly retrospective or clearly clarificatory.

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Issues: Whether the reintroduction of SSI exemption for parts of revolver by Notification No. 47/2001-C.E. dated 1-10-2001 operated retrospectively so as to cover the intervening period from 1-4-2001 to 30-9-2001.

Analysis: Notification No. 8/2001-C.E. withdrew SSI exemption in respect of goods falling under Chapter 93 of the First Schedule to the Central Excise Tariff Act, 1985 with effect from 1-4-2001. The later notification reintroducing the benefit from 1-10-2001 contained no indication that the exemption was intended to operate retrospectively. The budget speech and the statutory scheme showed a conscious withdrawal of the benefit for the intervening period. Exemption notifications are ordinarily prospective unless they are expressly made retrospective or are clearly clarificatory in nature. The prior decisions relied upon did not displace this principle.

Conclusion: The reintroduced SSI exemption was not retrospective and was unavailable for the period 1-4-2001 to 30-9-2001.

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