Substantive exemption under excise notification prevails over Rule 56A cash-refund bar; relief payable by cheque.

Rule 56A(3)(vi)(b), which bars cash refund of credit, does not apply to relief due under Notification No. 103/61 as amended where the notification grants a substantive exemption. The later incorporation of Rule 56A procedure through Notification No. 109/80 regulated only the manner of availing the benefit and could not override, nullify, or defeat the relief expressly conferred unless the notification was itself amended or superseded. The Department could not deny the consequential monetary relief on the ground that the notification had been rescinded and the credit had lapsed, and the assessee was entitled to payment of the relief by cheque.

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Issues: Whether the prohibition contained in Rule 56A(3)(vi)(b) of the Central Excise Rules, 1944, which bars cash refund of credit, applies to the relief due under Notification No. 103/61 as amended, and whether the Department could deny the consequential monetary relief on the ground that the notification had been rescinded and the credit had lapsed.

Analysis: The Tribunal held that Notification No. 103/61 granted a substantive exemption and that the later incorporation of Rule 56A procedure by Notification No. 109/80 did not import the substantive prohibition contained in Rule 56A(3)(vi)(b) so as to defeat the notification itself. The procedural machinery under Rule 56A could regulate the manner of availing the exemption, but it could not override or nullify the relief expressly granted unless the notification was itself amended or superseded. The Department's attempt to re-adjudicate a matter already decided in the assessee's favour was impermissible and contrary to judicial discipline.

Conclusion: The prohibition in Rule 56A(3)(vi)(b) does not apply to the relief due under Notification No. 103/61 as amended, and the assessee is entitled to payment of the relief by cheque.

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