Strict construction of excise exemption notifications governed the dispute, with later investment not enlarging benefit under one notification.

A writ petition challenging excise exemption notifications was not rejected for alternative remedy, because the matter had already remained pending for years, involved jurisdictional questions, and turned on construction of the notifications. Territorial jurisdiction was upheld since the impugned notification and departmental directions originated in Delhi and part of the cause of action arose there. On merits, Notification No. 107/81-C.E. was construed strictly and did not permit recomputation of exemption on later investments or clearances. Notification No. 88/84-C.E. was held applicable to Factory-III under the third proviso, not the second, because the factory was licensed under Section 13 and its first clearances began after 1 April 1976.

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Issues: (i) Whether the writ petition should be declined on the ground of availability of an alternative remedy; (ii) Whether the Delhi High Court had territorial jurisdiction to entertain the writ petition; (iii) Whether Notification No. 107/81-C.E. entitled the petitioner to exemption on the footing that subsequent investments and clearances enlarged the benefit; and (iv) Whether Notification No. 88/84-C.E. applied to the petitioner's Factory-III and, if so, under which proviso the benefit had to be computed.

Issue (i): Whether the writ petition should be declined on the ground of availability of an alternative remedy.

Analysis: The petition had remained pending for a long period, rule had been issued years earlier, and interim and amendment orders had already been passed. The dispute also raised jurisdictional questions and turned on the true construction of the notifications, which had already been decided by the departmental authorities. In such circumstances, the availability of an alternative remedy did not justify relegating the petitioner to another forum.

Conclusion: The objection based on alternative remedy was rejected, in favour of the petitioner.

Issue (ii): Whether the Delhi High Court had territorial jurisdiction to entertain the writ petition.

Analysis: The impugned notification, clarification, and related departmental directions emanated from Delhi, and a part of the cause of action arose within Delhi. The earlier Rajasthan proceedings had also left the present issue open, and the existence of any territorial objection was therefore not sustainable.

Conclusion: The Court held that territorial jurisdiction existed, in favour of the petitioner.

Issue (iii): Whether Notification No. 107/81-C.E. entitled the petitioner to exemption on the footing that subsequent investments and clearances enlarged the benefit.

Analysis: The notification, read as a whole, granted a limited exemption linked to first clearances within a fixed period and to the capital investment existing before the date of first clearance. The provisos and explanations did not create a facility for stage-wise recomputation of the exemption on later investments. Exemption notifications in fiscal law must be strictly construed, and the language used did not support the petitioner's broader reading.

Conclusion: The claim to a wider exemption under Notification No. 107/81-C.E. was rejected, against the petitioner.

Issue (iv): Whether Notification No. 88/84-C.E. applied to the petitioner's Factory-III and, if so, under which proviso the benefit had to be computed.

Analysis: Notification No. 88/84-C.E. separately dealt with factories licensed under Section 11 and factories licensed under Section 13 of the Industries (Development and Regulation) Act, 1951. Factory-III had been licensed under Section 13 and its first clearances commenced after 1 April 1976. The third proviso, and not the second, governed such a factory. The words used in the notification, especially the references to "such factory" and the structure of the provisos, showed that the seven-year limit and investment-based ceiling had to be applied under the third proviso.

Conclusion: Notification No. 88/84-C.E. applied to Factory-III under the third proviso, in favour of the petitioner.

Final Conclusion: The writ petition succeeded only to the extent that Notification No. 88/84-C.E. was held applicable to Factory-III under the correct proviso, while the broader challenge to Notification No. 107/81-C.E. failed; the matter was remitted for computation of duty accordingly.

Ratio Decidendi: Exemption notifications in fiscal law must be construed strictly and as a whole, and their benefit cannot be enlarged by implication beyond the plain terms used by the rule-making authority.

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