2004 (2) TMI 71

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....ol) Appellate Tribunal (in short "CEGAT") dated 26th September, 1996. 2. Briefly stated the facts are as follows :- The Respondents manufacture Polyester Fibre. In the manufacture of Polyester Fibre, there is an intermediate product known as "Tow". Under Rule 56A of the Central Excise Rules (as it then stood), the intermediate product could be cleared with nil rate of duty provided the final....

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....owing reasoning : "4. We have considered the pleas made by both the sides . We observe that as a matter of social welfare, the Government of India in public interest issued notification 191/85, dated 28-8-85 exempting polyester fibre which was supplied to KVIC. In the scheme of levy under tariff heading 5501.20, under which polyester staple fibre and tow figure, the duty envisaged was either at....

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....s that the exemption is in respect of duty which has to be paid either at the tow stage or at the staple fibre stage. To interpret the Notification in the manner in which the Revenue has sought to read will only defeat the very purpose of the Notification 191/85. The plea of the Revenue would have been valid in case there was two stage levy i.e. at the tow stage and the fibre stage separately. But....

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....d 1-7-92 issued in this regard exempting duty on tow used for fibre for supply to be clarificatory in nature and will have retrospective effect. The appeal is therefore allowed." Thus the Tribunal notices that the effect of Notification No. 191/85 is that levy of duty is only at one stage i.e. either at the "Tow" stage or at the Polyester Fibre stage. 4. The arguments of the Revenue, which h....