The word "cleared" in a notification exempting certain goods from excise duty refers only to excisable goods on which excise duty has been paid.

Brishketu Saran Sinha, J.

1. Messrs Shri Madhav Mills Private Limited (hereinafter referred to as the Mills) are engaged in the manufacture of Maida, which is item no. 1-F of the First Schedule attached to the Central Excises and Salt Act, 1944 (hereinafter referred to as the Excise Act) and bolts, nuts and screws which are item no. 52 of the said Schedule as also certain articles which are included under item no. 68 of the Schedule. The details of the other items excluding those under items 1-F and 68 are given in annexure 4 appended to the writ application.

2. By a notification issued by the Government of India dated 10th August, 1971 item no. 1-F of the First Schedule to the Excise Act, has been exempted from payment of duty under Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 (hereinafter referred to as the rules), copy of which is Annexure 1. Thereafter by a notification dated 18th June, 1977, under Rule 8(1) of the Rules (copy of which is annexure 2) the Government of India exempted goods falling under item 68 of the First Schedule, if to be utilised for home consumption and if the total value of all excisable goods in the preceding financial year docs not exceed Rupees thirty lakhs. The petitioner claims that under the aforesaid notification the total value of Maida manufactured by it in the preceding financial year could not be included in determining the exemption. The Assistant Collector of Central Excise (respondent no. 3), however, asserts that the value of Maida cleared in the previous financial year shall be taken into account for determining the exemption under the aforesaid notification. Hence this application.

3. The Excise Act, under Sec.2(d), defines excisable goods, and Sec.3 is the charging section which provides that there shall be levied and collected in such manner as may be prescribed, duties of excise on all excisable goods other than salt, which are produced or manufactured at the rates set forth in the First Schedule, and it further empowers different tariff values to be fixed for different classes or descriptions of the same article. Sec. 6 authorises the Central Government, by notification from such date as may be specified in it, to have the production or manufacture or any process of production or manufacture of any specified goods included in the First Schedule, licence the production or of salt petre or any specified component parts or ingredients of such goods or of specified containers of such goods in accordance with the terms and conditions granted under this Act. This First Schedule attached to the Act details the items of goods as also the basic and additional rates of duty. It appears that to begin with the First Schedule contained 11 items which has now increased to 68 items. Sec.37 empowers the Central Government to make rules and under Sec.38 such rules have to be laid before each House of Parliament while it is in session for a total period of 30 days which may be comprised in one or two more successive sessions. The Houses have the power to modify or annul the Rules. Under Rule 8(1) the Central Government is authorised from time to time by notification in the official gazette to exempt, subject to such conditions as may be specified in the notification, any excisable goods from the whole or any part of the duty leviable on such goods, The aforesaid two notifications, annexures 1 and 2, have been issued under this provision.

4. Relevant facts leading to this application are that, as already pointed out earlier, by a notification copy of which is annexure I, Maida was exempted from the duty of excise leviable thereon. Thereafter, in 1977, came the notification copy of which is annexure 2, granting exemption under certain conditions to articles manufactured under item no. 68. These items manufactured by the mill are M.S. rivets, castings, machinery parts, job work etc. Item 68 under the Schedule provided at the relevant period the rate of duty as 2% ad valorem. On th