J K SYNTHETICS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) THE Central Excise Tariff Act, 1985, came into force on 28/02/1986. It substituted the Schedule in the Central Excises and Salt Act, 1944, whereunder, till then, the excise tariff was prescribed. Prior to 28/02/1986, exemption notifications issued under Rule 8 of the Central Excise Rules had been in force. They ceased to have effect on the coming into force of the Tariff Act on 28/02/1986. They were replaced by other exemption notifications, though not precisely in the same terms. The process of issuance of these exemption notifications took some months. It was realized that by reason thereof manufacturers of exempted items would have to pay duty for the periods between the date on which the new tariff came into force and the dates on which the exemption notifications were issued. It was, therefore, that the Central Duties of Excise (Retrospective Exemption) Act, 1986, was passed. It gave retrospective effect to the exemption notifications. What is relevant for our purpose is Section 2, which, so far as is relevant reads thus :

(2.) THE exemption notification that concerns us in this appeal was issued on 3/04/1986, and it reads, so far as it is relevant, thus :

(3.) THERE is no dispute that the said notification has retrospective effect for the period 3/03/1986 to 8/08/1986, by reason of the Central Duties of Excise (Retrospective Exemption) Act, 1986.