ORDER
S.K. Bhatnagar, Vice President
1. This is an appeal against the order of the Collector of Central Excise, Jaipur.
2. The learned Counsel has stated that the main issue involved in this case is as to whether in view of the Budget day restrictions under Rule 2241, 2242 and 2242A of the Central Excise Rules, the goods removed after 5 p.m. but before mid-night following the Budget day were liable to the old rate of duty as prevailing on that day or the enhanced rate of duty announced in the Budget. In the instant case, the time of removal of the goods in question was from 17.10 hours to 17.50 hours in respect of gate passes (No. 6842-692) on which polyester filament was cleared on 19-3-1990 – the budget day. In the budget the rates of duty were enhanced and the Department is demanding the differential duty.
3. It was their contention that although they had given an undertaking to pay duty at the enhanced rate, if any, the new rate was actually applicable only on clearances, if any made on or after mid-night of 19-20th March 1990 in view of the Provisional Collection of Excise Taxes Act. In this respect, they relied on the Tribunal’s decision in the case of Indian Explosives Limited 1985 (20) E.L.T. 139.
4. The learned D.R. drew attention to the Collector’s order and reiterated his views and findings. He emphasized in the main that the provisions of the Rule 224 applicable on the budget day clearances and the appellants were required to honour the undertaking. He further stated that in the Indian Explosives case, the question related to payment of special excise duty which was levied by the budget presented on 28-2-1978 and the Tribunal had held that a special excise duty was a new duty coming to effect only from 00.00 hours on 28-2-1978 which could be levied only after it came into force at mid-night. In the present case, the duty had been levied even before presentation of the budget and in terms of Rule 2242A, the appellant was liable to pay duty at the enhanced rate from 17.00 hours of the budget day.
5. We have considered the submissions of both the sides. We feel that the issue is squarely covered by the order of the Tribunal in the case of Indian Explosives Limited cited supra.
6. In our view the basic principle to be followed is the same irrespective of whether it is a case of new levy or enhancement of the rate of pre-existing levy as the Section 4 of the Provisional Collection of Taxes Act makes budget provisions applicable from the mid-night following the budget day in both eventualities inasmuch as its clause 1 says that “a declared provision shall have the force of law immediately on the expiry of the day on which the Bill containing it is introduced” and these provisions are applicable in all cases where “it is expedient to amend the law providing for the immediate effect for a limited period of provisions in bills relating to the imposition or increase of duties of customs or excise”.
7. In case of Indian Explosives, the Tribunal has tried to read in harmony the provisions of the Rule 224 and those of the Provisional Collection of Taxes Act and the ratio will apply to the cases of new imposts as well as those of increase of duties of customs or excise, Hence respectfully following the ratio of the above order of the Tribunal, we set aside the impugned order and accept the appeal.