Jute cess on captive consumption: liability barred after 1-10-1984, but remained payable for the earlier period.

Jute cess on jute twines and jute yarns captively consumed in manufacturing was treated differently for two periods. For the period after 1-10-1984, cess was held not payable because the issue had already been settled in favour of the assessee and the lower authority lacked jurisdiction to treat rule 3 of the Jute Cess Rules, 1984 as repugnant to the parent enactment. For the period before 1-10-1984, the earlier Supreme Court ruling continued to govern, and cess remained payable on captive consumption.

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Issues: Whether jute cess was payable on jute twines and jute yarns captively consumed in the manufacture of other jute manufactures for the period before and after 1-10-1984.

Analysis: The Tribunal held that the levy on captively consumed jute twines and jute yarns had already been settled in favour of the assessee for the period after 1-10-1984, and that the lower authority had no jurisdiction to hold rule 3 of the Jute Cess Rules, 1984 repugnant to the parent enactment. At the same time, the period prior to 1-10-1984 remained governed by the earlier Supreme Court ruling, under which cess on captive consumption was payable.

Conclusion: Cess was not payable for the period after 1-10-1984, but was payable for the period prior to 1-10-1984.

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