Excise exemption notification interpreted to cover both basic and additional duties, keeping liability within the notified ceiling.

An exemption notification granting relief from excise duty in excess of 55% ad valorem was construed to apply to both the basic duty under the Central Excises and Salt Act, 1944 and the special/additional duty imposed by the Finance Act, 1978. The court applied the plain language of the notification and treated the special levy as a duty of excise of the same character, supplementary to the basic charge. Because the notification did not expressly confine the benefit to the basic duty, the exemption was held to cover the total excise burden, so duty payable could not exceed the notified ceiling.

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Issues: Whether Notification No. 123/74-C.E. granting exemption from so much of the duty of excise as is in excess of 55% ad valorem applied only to the basic excise duty under the Central Excises and Salt Act, 1944 or also extended to the special/additional duty of excise levied under the Finance Act, 1978.

Analysis: The exemption notification used general words exempting tyres from so much of the duty of excise leviable thereon as was in excess of 55% ad valorem, without limiting the relief to the basic duty under the Act. The nature of the special duty imposed by the Finance Act, 1978 was held to be still a duty of excise on manufacture or production, supplementary to the basic levy. In fiscal construction, the plain language of the notification controls, and there is no scope to cut down an exemption by reference to supposed legislative object where the words used are clear. The source of power for exemption could be traced to the statutory scheme, and the absence of an express reference to the Finance Act did not confine the exemption to the basic levy alone.

Conclusion: The exemption covered both the basic duty and the special duty of excise, and the total duty payable could not exceed 55% ad valorem.

Final Conclusion: The petitioners were entitled to the full benefit of the exemption notification, and the additional special duty could not be levied so as to take the duty above the notified ceiling.

Ratio Decidendi: Where an exemption notification in fiscal law exempts goods from so much of the duty of excise leviable thereon as is in excess of a specified rate, the exemption extends to all duties of excise of the same character unless the notification expressly limits it to a particular component.

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