LexCOLLECTOR OF CENTRAL EXCISE, GUNTUR versus ANDHRA SUGAR LTD.
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I ,, COLLECTOR OF CENTRAL EXCISE, GUNTUR v. ANDHRA SUGAR LTD. OCTOBER 26, 1988 A [SABYASACHI MUKHARJI AND RANGANATH MISRA, JJ.] B . . Central Excises and Salt Act, 1944--Sections 11 B(2) and.35 L(b) and Notifications No. 55/75 dated March 1, 1975 and No. 62/78 dated March 1, 1978-'Acetic anhydride'-Whether drug intermediate-- Whether exempt from duty. Statutory Interpretation-Court to give weight to interpretation put C upon statute at time of its enactment. The respondent manufactured 'Acetic Anhydride' falling under Tariff Item No. 68 of the Central Excise Tariff. It filed two refund claims In regard to the· duty paid on the acetic anhydride during the D period 5th February, 1981 to 26th February, 1982, contending that the goods were exempt from payment of excise duty leviable thereon under Notification No. 55/75 CE dated lst march, 1975 as amended by Notiti· cation No. 62/78 CE dated lst August, 1978, that Acetic Anhydride is a 'drug Intermediate' and that as delivery had been made to drug manufacturers i.e. IDPL, no excise duty was payable. E The Assistant Collector of Central Excise hy his adjudication allowed the refund of the aforesaid claims of the respondent under section 11 8(2) of the Central Excises and Salt Act, 1944. The department preferred appeals against the aforesaid orciers tu F the Collector of Central Excise (Appeals), who allowed the appeals and annulled the orders of the Assistant Collector granting refund. The appeals preferred by the respondent having been allowed by the Customs, Excise and Gold (Control) Appellate Tribunal, tne Revenue appealed to this Court under Section 35 L(bJ of the Act. G Dismissing the Appeals, HELD: 1. 'Acetic Anhydride' is a chemical but when it is sup· plied as a drug intermediate to a drug manufacturer, it would be entiUed to exemption under the relevant Notification. H 543 A B c D 544 SUPREME COURT REPORTS [1988] Supp. 3 S.C.R. 2. Keeping in view the language used in the exemption Notifica- tion and the purpose of the Notification, the expression 'drug inter- mediate' is of a- wide description and substance and must he so interpreted. [547B] In the instant case, the Acetic Anhydride manufactured by the appellant had been used by M,.s IDPL in the manufacture of drugs. In the light of the purpose for which the goods were used, the Tribunal came to the correct conclusion. [547B-C] Mysore Acetate & Chemical Co. Ltd. v. Assistant Collector, Cent- ral Excise, Mysore, [1984] 17 ELT 319 and Shasum Chemicals (Madras) Pvt. Ltd., [1982] ELT 786, referred to. 3. It is a well-settled principle of interpretation that courts in construing a Statute will give much weight to the interpretation put upon it at the time of its enactment, since those whose duty has been to construe, execute and apply the same enactment.- [546H; 547 A] 4. The meaning ascribed by the authority issuing the Notifica- tion, is a good guide of a contemporaneous exposition of the position of taw. [546GJ K.P. Varxhese v. The Income Tax Officer, Ernakulam, [1982] l B SCR 62'1, referred to. CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 1568-69 (NM) of 1988 From the Order dated 26.11. 1987 of the Customs Excise & Gold F (Control) Appellate Tribunal, New Delhi in Appeal No. ED (SB) 1648/84 C and 1923 of 1984-C. G. Ramaswamy, Additional Solicitor General (N.P.). Ms. Indu Malhotra and Ms. Sushma Suri for the Respondent. G The Judgment of the Court was delivered by SABYASACHI Mt;KHARJI, J. These are appeals under Section 35L(b) of the Central Excises and Salt Act, 1944 (hereinafter referred to as 'the Act'), arising out of the order of the Tribunal, dated 26th November, 1987. The issue involved in the present case is whether the H Acetic Anhydride manufactured by the respondent and sold to drug ·' I ;-. COLLECTOk OF C.E. v. ANDHRA SUGAR [MUKHARJI, l.] 545 manufacturers i.e. M;s. IDPL is eligible to benefit of exemption under A the notification No. 55/75 CE dated 1st March, 1975 as amended by the notification No. 62178 CE dated 1.3.1978 as drug intermediate. The respondent manufactured AcetiC Anhydride falling under Tariff Item No. 68 of the Central Excise Tariff. It had filed refund claims for Rs. 1,57,442.08 and Rs. l, 14,587. 74 being the duty paid on B Acetic Anhydride during the period from 5.2.1981 to 28.6.198 land from 23.7. 1981 to 26.2.19§2 contending that these goods were exempt from the payment of duty of excis
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