TaxTMI 
TaxTMI 
2001 (1) TMI 618
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....in the manufacture of the soap noodles. Simultaneously, the processor filed a declaration under Rule 57G for availing Modvat credit on the lifebuoy soap noodles as input and availed Modvat credit since then. As per the agreement, the processor receives duty paid soap noodles and carry out certain processes to convert the same into cake and remove the same to the appellant on payment of Central Excise duty under the authorisation of Notification No. 305/77. The processes undertaken by the processor include plodding, extruding, cutting, stamping, wrapping in wrappers and packing in corrugated boxes. 2.1 The appellants were issued a show cause notice dated 31-3-1993 alleging that during the period from January, 1988 to December, 1992 they availed money credit irregularly for an amount of Rs. 99,64,075.08 on minor oils used in the manufacture of soap noodles in contravention of Rules 57K, 57M and 57-O read with Notification Nos. 192/87, dated 12-8-1987 and 46/89, dated 11-10-1989 and the said amount was sought to be recovered. The money credit was sought to be disallowed on the ground that - (i) the soap noodles were not "finished products" but "semi-finished products" when cle....
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....1985 (19) E.L.T. 307 (CEGAT); (vii) Ashwini Vanaspati Industries (P) Ltd. v. Collector of Central Excise, 1991 (56) E.L.T. 214 (CEGAT); and (viii) Geep Industrial Syndicate Ltd. v. Collector of Central Excise, Allahabad, 1999 (114) E.L.T. 850 (CEGAT). 3.1 Advancing his arguments on merits of the case, the learned Advocate contends that the expression "soap in any form" used in sub-heading 3401.10 of the Central Excise Tariff is used without any qualification and must be taken to include all kinds of soap. According to him, the tariff sub-heading must be interpreted strictly in accordance with the well-known rule of strict interpretation of statutes, which states that a taxation statute has to be interpreted strictly in accordance with the express language of the statute. He submits there is no room for any intendment or implication of the words. He refers to the judgment of Hon'ble High Court of Allahabad in the case of Ganges Soap Works Pvt. Ltd. v. U.O.I., 1992 (43) ECR 707 (All.), which held that the soap noodles fall within the purview of sub-heading 3401.10 and further held that the assessee company was entitled to avail the benefit of Notificat....
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....diate products is accepted for the sake of argument only, it cannot by any stretch of imagination be contended that soap noodles do not have the essential character of the complete or finished goods, viz., soap. He has also advanced an alternative argument to the effect that the soap noodles being "most akin" to soap, the soap noodles shall be classified under the heading appropriate to the soap and thus fall under the sub-heading 3401.10. 3.3 Continuing his arguments, the learned Advocate refers to Note 1 of the General Explanatory Notes which forms part of the Schedule to the Central Excise Tariff Act which provides that "Where in column (3) of this Schedule, the description of an article or group of articles under a heading is preceded by '-', the said article or group of articles shall be taken to be sub-classification of the article or group of articles covered by the said heading." The word "Soap in any form" are preceded by a '-'. Accordingly, if soap noodles fall within the purview of the words "soap in any form", as is the stand of the appellants, soap noodles must be taken to be a sub-classification of the articles or group of articles covered by the main heading,....
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.... Products (P) Ltd., Hyderabad, 1984 (17) E.L.T. 187 (T) = 1984 ECR 2028 (CEGAT); and (vi) Jai Hind Process & Printing Depot, Rajkot v. Collector of Customs & Central Excise, Ahmedabad, 1985 (22) E.L.T. 195 (Tribunal) = 1985 ECR 457 (CEGAT). 3.5 The learned Advocate argues that an exemption Notification has to be construed strictly according to the express language of such Notification. In both the Notifications, the expression "final product" (and not "finished product") is used without any qualification and its scope is of the widest amplitude. Soap Noodles are clearly of the nature of "final product" entitled to the benefit of the Notifications. Accordingly, the expression "final product" cannot be restricted or narrowed down so as to make the availment of the money credit impossible in the case of soap noodles. Applying the rule of strict interpretation, the appellants are entitled to avail the benefit of the Notifications in the case of soap noodles manufactured by them. The plea that soap noodles were semi-finished or intermediate goods has been raised only to frustrate the valid and legitimate availment of the money credit in strict compliance of the mandatory....
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....7 (90) E.L.T. 264 (S.C.); Sun Export Corporation v. C.C., Bombay, 1997 (93) E.L.T. 641(S.C.); C.C., Calcutta v. Mitsunny Electronic Works, 1987 (30) E.L.T. 345 (Cal.); Deccan Sales Corporation v. R. Parthasarathy, 1982 (10) E.L.T. 885 (Bom.); T.I. Miller Ltd. v. UOI, 1987 (31) E.L.T. 344 (Bom.); Iron Master (India) Pvt. Ltd. v. UOI, 1999 (114) E.L.T. 792 (Del.); and Indye Chemicals v. Collector of Central Excise, 1986 (25) E.L.T. 318 (CEGAT). 3.7 Arguing that it is not open to the Revenue authorities to change their stand in the matter of classification without any cogent reasons, the learned Advocate submits that it leads to a divergent classification in other Commissionerates resulting in unfair discrimination of taxes in respect of the same goods. If the stand now taken by the excise authorities is accepted, a manufacturer of soap noodles would never have been able to avail the benefit of the above notifications. In this connection, he relies upon the decisions/judgments in the case of the Central India Spinning and Weaving Manufacturing Co. Ltd. and the Express Mills, Nagpur v. Municipal Committee, Wardha, AIR 1958 SC 341; C.C.E. v. Parle Exports (P) Ltd., 1988 (38) E.L....
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.... valid and legitimate availment of the money credit by the appellants. In this connection, we have perused the tariff entry 34.01 and notice that the expression "soap in any form" has been mentioned therein. We observe that in both the afore-mentioned notifications the goods to which the benefit of money credit is available are referred to as the "final products" with an amplification "namely, soap". As the 'final product' in the said notifications have been expressly specified to be 'soap', the discussion whether 'final products' mentioned therein would mean "finished products" is strictly irrelevant. The "final products" having been specifically identified as "soap", the benefit of the above notifications has to be made available to the products, which fall within the scope of the expression "soap". A little while ago we observed that the tariff entry 34.01 relates to the "soap in any form". In the instant case, the form in which the soap is manufactured and cleared by the appellants is "noodles" and the classification of it in that form as "soap" was duly approved by the Department. This unassailable factual position militates against the department's changed stand that the good....