The word "cleared" in the notification signifies the removal of an obstruction which is in the way on account of the imposition of excise duty and which obstruction is removed when the excise duty has been paid.

Brishketu Saran Sinha, J.

Messrs Shri Madhav Mills Private Limited (hereinafter referred to as 'the Mills') are engaged in the manufacture of Maida, which is item no. IF of the First Schedule attached to the Central Excise and Salt Act, 1944 (hereinafter referred to as 'the Excise Act') and bolts, nuts and screws which are item no. 52 of the laid 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 I-F and 58 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. I-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 proceeding financial year does not exceed Rupees Thirty lacs. The petitioner claims that under the aforesaid notification the total value of Maida manufactured by it in the proceeding 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 the 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 section 2(d) defines excisable goods and section 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 lame article. Section authorises the Central Government, by notification from such date as may be specified in it, to have for the production or manufacture or any process or production or manufacture of any specified goods included in the First Schedule or of saltpetre or of 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. The First Schedule attached to the Act details the items of goods as also the basis and additional rates of duty. It appears that to begin with, the First Schedule contained 11 items which has now increased to 68 items. Section 31 empowers the General Government to make rules and under section 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 1, 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 mills are M. Shrivetts, castings machinery parts, job work etc. Item 68 under the Schedule provided at the relevant period the rate of duty as 2% ad valorem.