Special exemption notifications continue on their own terms; later general duty reductions do not override the specific scheme by implication.

A special excise incentive notification for new sugar factories commencing production on or after 1 April 1974 was treated as a self-contained scheme, with its own duty structure for levy sugar and express exclusion of the earlier general levy-sugar notification. Later notifications reducing duty for levy sugar generally did not amend or supersede that special scheme by implication, so the original rate structure continued to apply to the covered factories. The ratio is that a special exemption or concession notification governs its intended class according to its own terms unless it is expressly changed.

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Issues: (i) Whether Notification No. 35/76-C.E. granted a continuing concession so as to reduce the excise duty and additional excise duty on levy sugar produced by the petitioner's factory in line with later notifications issued for other sugar factories; and (ii) whether the subsequent notifications altering the rate of duty on levy sugar for the general class of factories amended or superseded the special incentive notification applicable to factories commencing production on or after 1 April 1974.

Issue (i): Whether Notification No. 35/76-C.E. granted a continuing concession so as to reduce the excise duty and additional excise duty on levy sugar produced by the petitioner's factory in line with later notifications issued for other sugar factories.

Analysis: The notification formed part of a special incentive package for new sugar factories commencing production on or after 1 April 1974. It gave a defined benefit structure: higher free-sale quota, concessional duty on the portion of free-sale sugar beyond 35%, and duty on the price fixed for levy sugar. The proviso expressly excluded the application of the earlier levy-sugar notification for existing factories, and the notification itself fixed the applicable rate for the covered class until it was specifically altered. The later reductions in duty rates were issued in relation to levy sugar generally and did not, by their terms, alter the special scheme.

Conclusion: The petitioner was not entitled to claim the later reduced rates for levy sugar under Notification No. 35/76-C.E.; the original rate structure under the special notification continued to govern.

Issue (ii): Whether the subsequent notifications altering the rate of duty on levy sugar for the general class of factories amended or superseded the special incentive notification applicable to factories commencing production on or after 1 April 1974.

Analysis: The later notifications dealt with levy sugar under the general regime and repeatedly superseded the earlier general notification applicable to existing factories. None of them referred to, modified, or superseded the special notification for new factories. The field occupied by the special notification remained untouched, and the later changes in levy-sugar rates could not be imported into that separate incentive scheme by implication.

Conclusion: The subsequent notifications did not amend or supersede Notification No. 35/76-C.E., and they had no effect on the duty payable under that special scheme.

Final Conclusion: The challenge to the demand failed because the special exemption scheme continued to operate according to its own terms, and the impugned demand was upheld.

Ratio Decidendi: A special exemption or incentive notification continues to govern the covered class according to its own terms unless it is expressly amended or superseded; later general notifications on the same subject do not alter it by implication.

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