Budget day clearances under an undertaking attracted enhanced duty, and a specific demand notice was sufficient for recovery.

Clearances made on budget day between 1700 hours and 2400 hours under an undertaking to pay any enhanced duty attracted the revised rate, because the permission was conditional and the undertaking expressly covered differential duty. The Tribunal's later reasoning rejected the view that the increase operated only from midnight. A demand issued by the Superintendent was sufficient notice for recovery where it specifically called for payment of differential duty at the enhanced rate in terms of the undertaking. The Revenue's appeal succeeded and recovery of the differential duty was upheld.

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Issues: (i) Whether the enhanced rate of duty was payable on clearances made on the budget day between 1700 hours and 2400 hours under the undertaking furnished by the assessee; (ii) whether the demand issued by the Superintendent was sufficient notice for recovery of the differential duty.

Issue (i): Whether the enhanced rate of duty was payable on clearances made on the budget day between 1700 hours and 2400 hours under the undertaking furnished by the assessee.

Analysis: The clearance was made pursuant to permission granted on the budget day subject to an undertaking to pay the differential duty if the rate of duty increased. The applicable rule permitted recovery in terms of that undertaking. The prior view treating the increase as operative only from midnight was not accepted in light of the later Tribunal reasoning that budget day clearances during the specified hours attracted the enhanced rate.

Conclusion: The enhanced rate of duty was payable on the budget day clearances between 1700 hours and 2400 hours, against the assessee.

Issue (ii): Whether the demand issued by the Superintendent was sufficient notice for recovery of the differential duty.

Analysis: The demand dated 27-3-1992 specifically called upon payment of differential duty at the enhanced rate in terms of the undertaking. That communication adequately informed the assessee of the liability and the basis of recovery.

Conclusion: The demand notice was sufficient, against the assessee.

Final Conclusion: The impugned order was set aside and the Revenue's appeal succeeded, resulting in recovery of the differential duty on budget day clearances.

Ratio Decidendi: Where clearance on budget day is made pursuant to an undertaking covering enhancement in duty, the enhanced rate applies to clearances within the stipulated hours, and a demand specifically invoking that undertaking is sufficient for recovery.

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