TEXMACO LTD. Vs. COMMISSIONER OF C. EX., KOLKATA

JUDGEMENT

(1.) SINCE the issue involved in all these three appeals is same, we are taking up them for passing in a common order. In terms of the impugned orders, the appellants are required to pre -deposit duty amount and penalty as mentioned below :

(2.) WE heard the parties. The demand in all these cases arise for the period from 28 -2 -1993 to 3 -5 -1993 for a period of 65 days (for SP -441), from 1 -3 -1993 to 3 -5 -1993 (for SP -442/06) and from 1 -3 -1993 to 3 -5 -1993 (for SP -465/06). Prior to 28 -2 -93 Railway wagons manufactured by the appellants were dutiable. However, the Govt. issued a Notification No. 60/93 -C.E. dated -28 -2 -1993 by which the Railway wagons supplied to the Indian Railways were exempted from duty liability. Prior to 28 -2 -1993 while the wagons were dutiable, the exemption was provided to the parts manufactured in the factory by virtue of Notification No. 217/86 -C.E. Since the wagons were exempted, revenue contended that the exemption for parts would not be available. Consequently, the demands were slapped on the appellant. Penalties have also been imposed. The Indian Railways took up the entire issue with the Govt. of India. It was felt that the so called parts manufactured within the factory are not identifiable parts which are excisable. Moreover, the very purpose of the notification would be defeated if duty is demanded on the parts manufactured by the appellant. To resolve the problem, the Govt. of India issued another Notification No. 88/93, dated - 4 -5 -93 by which parts manufactured within the factory in respect of the wagons were fully exempted. In this connection, the Ld. Counsel who argued the case drew the attention of the Bench to the decision of the Honble Apex Court in the case of W.P.I.L. Ltd. v. Commr. of Central Excise, Meerut, U.P. reported in 2005 (181) E.L.T. 359 (S.C.) wherein in respect of the similar situation, it was held that for the period intervening the two notifications, no duty could be demanded on these parts. In those cases the relevant notification were 46/94 -C.E. dated 1 -3 -94 and 95/94 -C.E. dated 25 -4 -94. In the first notification, there was an omission with regard to the exemption of the parts manufactured. This was noticed and the anomaly was removed by issue of the subsequent notification but the Revenue demanded duty on the intervening period on the ground that there was no exemption for the said parts during the intervening period. The Supreme Court held that the later notification did not grant the exemption for the first time as it was only clarificatory and it will have retrospective effect.

(3.) WE are of the considered view that the ratio of the above case will be squarely applicable in these cases though the Ld. JDR does not agree with this and stated that the notification should be strictly construed and no adding or substracting is permitted. However, we feel that this is a fit case for waiver of pre -deposit of duty and penalty, in view of the Apex Courts decision in the case cited (supra). Hence we order waiver of pre -deposit of duty/penalty demanded till the disposal of the appeals in their turns.