Plain wording of rebate notification controlled average production computation; nil production years were ignored and writ recourse remained available.

A writ petition remained maintainable where the Tribunal refused a reference not on merits but because the statutory reference provision was inapplicable, so recourse to Articles 226 and 227 was available. On rebate computation under Notification No. 132/82-Central Excise, periods of nil production in the preceding three sugar years had to be ignored because the notification required average production to be based only on corresponding periods in which the factory actually produced sugar. The incentive character of the scheme could not override its plain wording, and nil-production years could not be treated as part of the averaging base. The Revenue's method of computation was upheld.

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Issues: (i) Whether the writ petition was maintainable after the reference application was held not maintainable; (ii) whether, under Notification No. 132/82-Central Excise, the periods of nil production in the preceding three sugar years were to be ignored while computing average production for rebate.

Issue (i): Whether the writ petition was maintainable after the reference application was held not maintainable.

Analysis: The refusal of reference by the Tribunal was not on merits but on the ground that the statutory reference provision was inapplicable. In that situation, recourse to writ jurisdiction under Articles 226 and 227 of the Constitution of India was open, and the High Court ought not to have declined the petition merely on maintainability.

Conclusion: The writ petition was maintainable, though the Court proceeded to examine the matter on merits.

Issue (ii): Whether, under Notification No. 132/82-Central Excise, the periods of nil production in the preceding three sugar years were to be ignored while computing average production for rebate.

Analysis: The notification expressly required the average to be computed from the corresponding periods in the preceding three sugar years in which the factory had actually produced sugar, and the periods of non-production were to be ignored. The notification was treated as an incentive scheme, but its plain language controlled the method of computation. On that construction, the production of the only year in which there was actual production in the relevant base period could be taken into account, and the nil years could not be added back for averaging by dividing the single year's output by three.

Conclusion: Nil production years were correctly ignored, and rebate on the basis adopted by the Revenue was valid.

Final Conclusion: The challenge to the Revenue's computation failed because the notification was construed according to its plain terms, and the appellant was not entitled to a larger rebate.

Ratio Decidendi: Where an exemption or rebate notification expressly directs that periods of non-production shall be ignored in computing average production, the computation must be made strictly according to that language and cannot be altered by invoking the incentive object of the scheme.

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