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of <h1>Court affirms excise duty exemption based on notification's language and intent, rejecting Revenue's inconsistent stance.</h1> <h3>COLLR. OF C. EX., PUNE Versus TATA ENGINEERING AND LOCOMOTIVES CO. LTD.</h3> COLLR. OF C. EX., PUNE Versus TATA ENGINEERING AND LOCOMOTIVES CO. LTD. - 2003 (158) E.L.T. 130 (SC), 2003 (11) SCC 193, 2003 (8) JT 557, 2003 (9) SCALE ... Issues:1. Interpretation of Notification No. 217/86-C.E. for excise duty exemption.2. Application of exclusion clause in the Explanation of the notification.3. Consistency in Revenue's stand regarding the interpretation of the notification.Analysis:Issue 1: The respondent-assessee claimed exemption from excise duty under Notification No. 217/86-C.E. for manufacturing various items used in their final products. The Tribunal granted the benefit of the notification, which was challenged by the Revenue in this appeal.Issue 2: The dispute centered around the exclusion clause in the notification, which stated that the exemption does not apply to goods used for producing, processing, or bringing about any change in the substance in relation to the manufacture of final products. The Revenue argued that the goods in question were integral to the production chain and fell within the exclusion clause. However, the respondent contended that the exclusion clause only applied to production and processing machines, not other capital goods covered by the notification.Issue 3: The Court noted that the notification's exemption clause had a wider scope compared to the exclusion clause. The Tribunal's previous decision in favor of another assessee on a similar issue was cited, highlighting the Revenue's inconsistency in challenging interpretations of the notification. The Court held that the Revenue's acceptance of the Tribunal's decision in the past precluded them from taking an inconsistent stand now.In conclusion, the Court dismissed the appeal, upholding the Tribunal's decision to grant the excise duty exemption to the respondent-assessee. The Court emphasized the distinction between the exemption and exclusion clauses in the notification, ruling in favor of the assessee based on the specific language and intent of the clauses. The Revenue's inconsistent stance on similar interpretations of the notification was also a significant factor in the Court's decision to dismiss the appeal.
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