Levy effective date controls cess liability even when collection rules are notified later.

Cess on paper and paper board became chargeable from the effective date fixed in the levy order, even though the collection rules were notified later. The levy was made under the Industries (Development and Regulation) Act and the order expressly operated from 1-11-1980; the later notification of machinery provisions did not postpone liability. In the absence of material showing that the levy order was not publicly available or operative before that date, the cess was validly collected for the intervening period and the refund claim failed.

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Issues: Whether cess on paper and paper board was leviable and recoverable from 1-11-1980 under the Government order dated 27-10-1980, notwithstanding that the Paper and Paper Board Cess Rules, 1981 were notified later on 16-2-1981.

Analysis: The levy was imposed by the Central Government in exercise of the power under Section 9(1) of the Industries (Development and Regulation) Act, 1951, and the order itself specified that the cess would operate from 1-11-1980. The mere later notification of the collection rules did not mean that the levy order had not been published or that it was ineffective until 16-2-1981. No material was shown to establish that the order was unavailable to the public before its effective date. The Tribunal followed its earlier decisions holding that the liability to cess arose from the date fixed in the levy order and did not await the later machinery provisions for collection.

Conclusion: The cess was rightly collected from 1-11-1980 to 15-2-1981 and the refund claim was rightly rejected. The decision is against the assessee and in favour of the Revenue.

Ratio Decidendi: Where a levy order clearly fixes an effective date, the tax or cess becomes chargeable from that date even if collection rules are notified later, provided the levy order was published and operative.

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