Judgment

RUMA PAL, J.- M/s ITC Ltd. (hereafter referred to as the appellant) manufactures cigarettes. Prior to 1983 excise duty was leviable on cigarettes under Section 4 of the Central Excises and Salt Act, 1944 (referred to as "the Act") at rates specified under Tariff Item 4 of the First Schedule to the Act. The dispute in this appeal relates to the excise duty payable by the appellant for the period 1983 to 1987 on the cigarettes manufactured by it. The resolution of this dispute lies primarily in the interpretation of two exemption a notifications, namely, Notification No. 36/83 dated 1-3-1983 (referred to hereafter as "the 1983 notification") and Notification No. 201185 dated 2-91985 (referred to hereafter as "the 1985 notification") issued under Rule 8(1)

of the Central Excise Rules, 1944 (referred to as "the Rules") and Section 3(3) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957. The 1985 notification which replaced the 1983 notification was in b similar terms except that the rates of excise duty and the categories of the cigarettes entitled to be exempted were different. In substance, however, as far as the question of interpretation is concerne