2015 (9) TMI 353 - SC - Central Excise

Interpretation of Central Excise exemption notifications upheld by Supreme Court.

COMMISSIONER OF C. EX., AHMEDABAD Versus RELIANCE INDUSTRIES LTD.

The Supreme Court upheld the decision of the Customs, Excise and Gold (Control) Appellate Tribunal regarding the interpretation of exemption notifications ... Exemption of duty on Yarn - effect of amendment notifications - the expression “or draw twisted or texturised yarn” was deleted and the entry then read “dyed, printed, bleached or mercerised, yarn whether single, multiple (folded) or cabled, manufactured in a factory, which does not have the facilities (including plant and equipment) for producing single yarn”. - The revenue does not dispute that the assessee is covered by entry against serial No. 116A of the Notification No. 34/97, dated 6th June, 1997. If that be so, then assessee is entitled to take benefit of exemption Notification No. 34/97 and it is exempted from payment of duty on dyed yarn. - the view taken by the Tribunal [2002 (8) TMI 221 - CEGAT, MUMBAI] is not legally flawed - Decided against the revenue. Issues: Interpretation of exemption notifications under Central Excise Rules and entitlement to benefit of exemption notification.In a legal judgment by the Supreme Court, the Customs, Excise and Gold (Control) Appellate Tribunal's decision was upheld. The Tribunal had relied on a previous judgment by the Supreme Court in Hico Products Ltd. v. Collector of Central Excise to reach its conclusion. The Supreme Court in Hico Industries had discussed the interplay between Section 3 of the Central Excises and Salt Act, 1944, Rule 8 of the Central Excise Rules, 1944, and exemption notifications. It was established that when excisable goods are exempted from duty under a specific item, the assessee has the option to forgo the benefits of the exemption notification. This principle is based on the maxim allowing individuals to waive the advantage of a law made for their private benefit without infringing public rights or policy.The case involved the applicability of various notifications issued by the Central Government under the 1944 Act. The assessee's goods were covered by Notification 67/95-C.E., but the assessee chose not to avail the exemption and paid the duty. Subsequent notifications, such as Notification No. 4/97, Notification No. 19/97, and Notification No. 34/97, were analyzed. It was found that the assessee was covered by the entry against serial No. 116A of Notification No. 34/97, dated 6th June, 1997, which entitled them to the benefit of exemption from duty on dyed yarn.Considering the factual and legal circumstances, the Supreme Court concluded that the Tribunal's decision was legally sound and did not warrant any interference. Therefore, the civil appeal was dismissed without costs. The judgment reaffirmed the principles of exemption notifications under the Central Excise Rules and clarified the entitlement of the assessee to the benefits of such notifications based on the specific provisions and factual findings.