TaxTMI 
TaxTMI 
2017 (3) TMI 373
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....d for manufacture of fabric. Two show cause notices were issued to the appellant for recovery of Additional Duties of Excise (Textile and Textile Articles) Act, 1978 to the extent of Rs. 69,46,926/- for January - February 2003 and to the extent of Rs. 1,87,34,372/- for March - September 2003 The order-in-original no. 30/KKS/2003-2004 dated 31^st March 2004 of Commissioner of Central Excise, Mumbai - III held that the said duty being a surcharge leviable on duty, which itself being 'nil', would exclude the intermediate goods from levy under the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 dropped the demand. Revenue is in appeal against the said order. 2. The primary contention is that the exemption provided by notification no. 67/95-CE dated 16^th March 1995 is limited to the basic excise duty or such of the duties as are leviable under the First Schedule to the Central Excise Tariff Act, 1985, and an independent legislative enactment for levy does not admit to the extension of section 5(a) of Central Excise Act, 1944 to it. 3. The reviewing authority relied upon the decision of the Hon'ble Supreme Court in Modi Rubber Ltd [1986 (25) ELT 849] holding ....
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....005 (192) ELT 868 (Tri.-Mumbai)] . The said decision has referred to all the three judgments/decisions cited in the present order under challenge before coming to the conclusion that additional duty is not leviable when goods are exempt from basic excise duty. 5. Learned Senior Counsel appearing for the respondent draws our attention to the decision of the Tribunal in Rivaa Exports Ltd v. Commissioner of Central Excise, Surat - I [2015 (330) ELT 514 (Tri - Ahmd.)] which, on reference to third Member arising out of difference of opinion between two members of the bench, held that the decision in Toyota Kirloskar Motor Pvt Ltd v. Commissioner of Central Excise, Bangalore [2007 (217) ELT 403 (T)] exempts the additional duty when read in conjunction with any exemption provided by any of the rules/provisions of the Central Excise Rules framed under Central Excise Act, 1944. We note that the decision in re Rivaa Exports Ltd was subsequent to the decision in re Mahendra Petrochemicals Ltd and also takes note of the decision of the Hon'ble High Court of Himachal Pradesh in re Indo Farm Tractors and Motors Ltd which was followed in Mahendra Petrochemicals Ltd. In this connection we also ....
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....decision by the Hon'ble Supreme Court. It is difficult to accept the contention sought to be raised on behalf of the appellants that NCCD which is a duty leviable under the Finance Act, 2001 would stand exempted in the clause in the said notification. It is not permissible for this Tribunal to read with the said notification that the duty under statute is not specified under the said notification. xxxxx 16. The contention that the notification to be construed liberally on the ground that the exemption has been granted essentially to give incentive for promoting growth and development is also devoid of substance. Once the exemption explicitly restricted to specific duties, it is not permissible for the Tribunal to extend the scope of the exemption under such notification under the guise of interpretation.' 8. On urging of the Learned Senior Counsel, we revisited the charging provision of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978, viz. '3. Levy and collection of additional duties of excise on certain textiles and textile articles. (1) When goods of the description mentioned in the Schedule chargeable with a duty of excise under the Centr....
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.... accord the benefit of a proportionately lower additional duty on goods which are subject to some concessional rate of duty in contradistinction with those that are subject to 'nil' rate of duty being burdened with additional duty in full which is an absurdity. We do not consider that it was the intent of the legislature to palpably discriminate thus when subjecting textile article to this levy. 12. We also note that the decision in re Indo Farm Tractors and Motors Ltd, relied upon in the decision of re Hero Honda Motors Ltd, relates, primarily, to cess leviable on automobile under the Industries (Development and Regulation) Act, 1951. The said cess was not charged with reference to the basic excise duty and hence adoption of that ratio in the instant dispute would not be appropriate. We also notice that the reference to education cess in the decision of the Hon'ble High Court of Himachal Pradesh supra is merely a passing one and notes that the notional rate of standard duty can be adopted for levy of 'education cess'. Obviously, that ruling is made in the context of a contention that there is no machinery provision for levy of education cess when effective rate of duty is 'nil'....