Exemption under central excise notification denied where stainless steel flats were not duty-paid inputs under the original conditions.

Exemption under Notification No. 450/86-C.E. was denied for stainless steel hot patti/patta manufactured from stainless steel flats because the notification applied only where the inputs used in manufacture had suffered duty and no credit had been taken under the Central Excise Rules. The decisive fact was that the final product was made from flats, not from duty-paid ingots as such, and no duty had been paid on the flats. The later amendment in Notification No. 63/90-CE enlarged the exemption to cover patti/patta made from duty-paid ingots or flats, but it was not part of the original notification and could not be applied to the earlier period.

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Issues: Whether the appellants were entitled to exemption under Notification No. 450/86-C.E. for stainless steel hot patti/patta manufactured from stainless steel flats said to be duty paid in the form of ingots, and whether the amended notification could be applied retrospectively to the period in dispute.

Analysis: The notification granted nil rate of duty only where the inputs used in manufacture had suffered duty and no credit of such duty had been taken under Rule 56A or Rule 57A of the Central Excise Rules. The decisive fact was that the final product had been manufactured from stainless steel flats, not from the duty-paid ingots as such, and no duty had been paid on the flats. The condition attached to the exemption was therefore not satisfied. The later amendment by Notification No. 63/90-CE widened the exemption to cover patti/patta made from ingots or flats on which duty had already been paid, but that amendment was not part of the original notification and, in any event, the period in dispute was prior to the amendment.

Conclusion: The appellants were not entitled to the exemption under Notification No. 450/86-C.E., and the amended notification could not be invoked for the earlier period.

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