The main legal point established in the judgment is that the notifications under Rule 191A and Rule 191B operate in different fields and contemplate different situations. The court also clarified that the Doctrine of Promissory Estoppel and legitimate expectation do not operate where the estoppel or expectation is contrary to any law or Rule.

Sanjeev Sachdeva, J.

1. The petitioner has filed the present writ petition seeking quashing of the order dated 04.11.1997, passed by the Joint Secretary to Government of India, whereby the revision application filed by the petitioners under Section 35EE of the Central Excise Salt Act, 1944, (“Act”, in short) against the order passed by the Commissioner (Appeals), Mumbai was rejected.

2. The petitioner is aggrieved by the rejection of the rebate claim of Rs.2,18,694,64/- made under Rule 191A of the Central Excise Rules, 1944 by the petitioner. The petitioner had raised the claim pursuant to export of “Cotton Quilt Covers” and the Central excise duty paid on the cotton fabrics used in the manufacture of such quilt covers.

3. The petitioner is a company engaged in the manufacture of yarn, fabric, etc. The petitioner manufactures fabrics and pays duty thereon and clears the same to approved job workers for the purpose of manufacturing cotton quilt covers.

4. During the period May 1994 to September 1994, the petitioner exported the quilt covers manufactured by the job workers and applied for refund of the excise amount paid on the inputs (i.e. cotton fabric used in the manufacture of quilt covers).

5. On 16.08.1995, the Assistant Commissioner of Central Excise, Division A, Bombay, issued a show cause notice to the petitioner to show cause as to why the rebate amount sanctioned should not be rejected as inadmissible under Section 11B of the Central Excise Salt Act, 1944 read with Rule 191A of the Central Excise Rules,1944.

6. The Assistant Commissioner, Central Excise, in the show cause notice mentioned that from the list of the products appended to notification issued under Rule 191A, the entry at serial No.17 was only “Cotton Quilts” and there was no entry of “Quilt Cover”.

7. In reply to the show cause notice, on 25.08.1995, the petitioner submitted a representation contending that it was exporting Quilts/shells and not Quilt covers and as such, was entitled to the rebate.

8. Vide order dated 04.09.1995, the Assistant Collector of Central Excise rejected the rebate claim of the petitioner and held as under:-

“I have carefully perused the case records and considered the submissions made by the party in writing as well as orally. I find that the rebate has been claimed on Form AR5s as prescribed under earstwhile Rule 191A. The said Rue 191A provides for procedure for export of articles under rebate of duty on the excisable goods used in the manufacture and packing. In terms of sub-rule 1 of Rule 191A, the Central Board of Excise and Customs have declared Cotton Quilts (Rajais) in respect of which the rebate of duty on the Excisable contents thereof shall be allowed.

In the present case, what has been exported is scourd quilt cover as described in Form AR5s on which refund has been claimed. The shipping Bills relevant to the rebate claims in question described the goods as 100% cotton Fabrics Millmade scoured feather proof quilt covers double stitched. In the relevant contract copy produced by the assessee, the description of the goods exported reads as 100% Cotton Made in India Scoured Feather Proof Silicon Finish Piped Seam Quilt Shells”. The similar description appears in few shipping bills also.

The party vide their letter dt. 24.08.95 accepts that the goods are Quilt Shells. At the time of personal hearing I have been shown a sample of Quilt Shell which had a small opening at one side through which the feathers or cotton can be pumped in the said shell. There was no stuffing in the said Quilt Shell/Cover. Thus it is abundantly clear that what has been exported is not the Quilt (Rajais) as it is known in the trade but Quilt Cover/Shell without any stuffing therein. The party themselves have admitted that there is no stuffing inside the said so called shell/cover. The Quilt/Rajais in India or abroad is known as such only with stuffings of feather/cotton/polyester inside two layers of fabrics stitched together from all sides. Quilt