K.L. Rekhi, Member (T)

1. The dispute in this case is on the method of calculation of average production of sugar for the purpose of grant of the Central Excise Duty Concession (commonly called incentive rebate for higher production) in terms of the exemption notification No. 132/82-C.E., dated 21-4-1982. In order to facilitate the understanding of the controversy, we reproduce this notification below :-

"In exercise of the powers conferred by Sub-rule (1) of rule 8 of the Central Excise Rules, 1944, read with Sub-section (4) of Section 50 of the Finance Act, 1982 (14 of 1982), the Central Government hereby exempts sugar, described in column (1) of the Table below and falling under sub-item (1) of Item No. 1 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944), from so much of the duty of excise and special duty of excise leviable thereon as is specified in the corresponding entry in columns (2) and (3) of the said Table.

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Provided that the amount of exemption specified in column (2) or column (3) of the said Table shall not exceed the amount of duty of excise payable on free sale sugar or levy sugar, as the case may be.

Explanation :-In this notif