Exemption notification defence cannot be changed on appeal after contesting the case on a different clause.

A party cannot change in appeal the factual and legal basis on which it chose to contest an excise duty demand before the Tribunal. Here, the appellants had defended the show cause notice and Tribunal proceedings on the footing that clause (iv) of the exemption notification applied, but later sought to rely on clause (i) and the wording of the notice before the SC. That shift was rejected, and the appellants were not permitted to resile from their earlier stand. The challenge to the central excise duty demand therefore failed.

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Issues: Whether the appellants could be permitted to abandon the basis urged before the Tribunal and rely in the Supreme Court upon a different clause of the exemption notification to avoid central excise duty.

Analysis: The appellants had contested the show cause notice and the Tribunal proceedings on the footing that clause (iv) of the exemption notification applied. The later attempt to rely instead on clause (i) and on the wording of the show cause notice was rejected, because a party cannot resile in appeal from the factual and legal basis on which it chose to contest the matter before the Tribunal.

Conclusion: The appellants were not permitted to change their stand, and the challenge to the duty demand failed.

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