Proceedings initiated under a repealed Rule lapse with the omission of the Rule and cannot be continued under a new provision introduced on the same date, unless there is a specific provision for continuance.

C. S. P. SINGH, J.

( 1 ) THE petitioner is engaged in the business of printing of tissue paper on one side with colour. It appears that the petitioner used to file a classification list of the excisable goods made by it under rule 173-B of the Central Excise Rules, hereafter referred to as the Rules. The petitioner has filed the classification lists for the years 1976 and 1979 as Annexures 1 and 2 to the writ petition. At Item 3 dyed tissue paper was shown to be nil. Similar is the position in 1979. The petitioner has averred that the same situation prevailed in the intervening and other years. On the 8th of august, 1980, the petitioner received a notice purporting to be under Rule 10 (a) of the Rules. The notice directed the petitioner to show cause as to why he should not be required to pay excise duty on coloured tissue paper for the period from August, 1976 to June, 1980. The petitioner in response to the notice, sent a detailed reply on the 16th August, 1980. It transpires that a letter concerning the same matter was sent to the petitioner by the Department on the 1st of september, 1980, and the petitioner sent a short reply to this also. On behalf of the Excise department it has been denied that the petitioner sent a reply to the show-cause notice of the 8th august, 1980. On the view that we propose to take, it is not necessary to decide as to whether the petitioner had, in fact, sent a reply to the show cause notice. Counsel for the petitioner has challenged the show-cause notice dated 8th of August, 1980, issued under Rule 10 and the subsequent proposed action thereon, on a number of grounds. In the first place it has been contended that inasmuch as Rule 10 has been omitted by Notification No. 177/80-C. E. , dated 12th November, 1980, which came into effect from the 17th November, 1980 no further proceedings pursuant to the notice can be taken as the notice had lapsed in the eye of law. It has also been contended that the notice in so far as it makes a demand or duty for a period exceeding six months from the date of its issue is barred by time. It was also urged that so far as dyed tissue paper is concerned, it is exempt from tax under Notification No. 68/76, dated 16-3-76. As we are of the view that the first contention deserves acceptance, it is not necessary to express any view on the others. Rule 10 of the Rules was omitted by the Notification of the 12th November, 1980 which came into effect from the 17th November, 1980. On this very date Section 11a which had been inserted in the Central Excise Act was enforced. Section 11a is in part materia with Rule 10 of the Rules. The amending Act which brought Section 11a on the statute book did not contain any provision to the effect that proceedings pending under Rule 10 on the date whom the aforesaid provision came into effect would be treated as proceedings under the section. The question arises as to whether proceedings pursuant to the notice dated 8th of August, 1980, issued under Rule 10 can be continued after the omission of these rules with effect from the 17th of November, 1980, and also as to whether the notice of the 8th August, 1980 lapsed with the omission of the Rule. We were, at one stage of the view that the proceedings could continue, but in view of the decision of the Supreme Court in the case of M/s Rayala Corporation (P) Ltd. v. The Director of Enforcement, A. I. R. 1970 Supreme Court 494, it has to be held that with the omission of Rule 10 the notice issued under that Rule will lapse and no proceedings under that provision can now be taken. The notification omitting Rule 10 did not contain any provision for continuance of the proceedings already initiated and neither did Act 25 of 1978, which introduced Section 11a of the Act adopt the legal device of creating a fiction by virtue of which proceedings under Rule 10, could be deemed to be proceedings under Section 11a of the Act. The Supreme Court in the case of Rayala Corporation (Supra) has held that

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