Strict construction of exemption notifications meant cotton fabrics from co-operative society power-looms qualified for excise relief despite third-party production.

Cotton fabrics manufactured on power-looms owned by a co-operative society remained eligible for excise exemption where the notifications did not say the fabrics had to be produced for the society's own account. The Court applied strict construction of exemption notifications and held that, in a taxing instrument, plain language controls and no additional limitation can be read in by implication. The object of the exemption could not override the express words, and a casus omissus could not be supplied by interpretation. The excise demand and penalty were therefore unsustainable, and the writ relief quashing the demand was granted.

---

---

Issues: Whether cotton fabrics manufactured on power-looms owned by a co-operative society were entitled to exemption from excise duty under the relevant notifications even though they were produced for a third party and not for the society's own account.

Analysis: The exemption notifications granted relief to cotton fabrics produced on power-looms owned by a co-operative society, subject to specified conditions. The decisive question was whether the words of the notifications required the fabrics to be produced by the society only for itself. The Court held that the notifications contained no such limiting words. In a taxing provision or exemption notification, there is no room for intendment and the benefit must be determined by the plain language used. The object of the exemption could not control the clear terms of the notification, and the Court declined to read into it a restriction that the fabrics must have been produced for the society's own use. The principle against supplying a casus omissus also barred adding such a condition by construction.

Conclusion: The assessee was entitled to exemption from excise duty for the cotton fabrics covered by the notifications, including the disputed later periods, and the duty demands and penalty could not stand.

Final Conclusion: The assessment and appellate orders were set aside and the writ relief quashing the excise demand was granted, resulting in complete success for the assessee.

Ratio Decidendi: An exemption notification in a taxing statute must be construed strictly according to its express words, and a court cannot add a limitation not found in the language of the notification merely because it may accord with the supposed object of the exemption.

---