Page 52 - GSTL_16 April 2020_Vol 35_Part 3

266 GST LAW TIMES [ Vol. 35
“15. The crux of the issue is that the Government of India withdrew the
exemption from payment of duty on export of sugar with the objective of
controlling the domestic sugar prices. This had nothing to do with the ex-
porters such as the petitioners. Raw sugar imported against advance au-
thorization on the condition of re-export had no impact on domestic sugar
price. Impounding export duty on such exports would not serve the pur-
pose of controlling local sugar prices. Apparently since inadvertently the
withdrawal of exemption also hit the exports of sugar against advance au-
thorization, the Government of India on the representations made by the
trade, quickly reintroduced the exemption limited to such class. Very clear-
ly thus, the Government of India was correcting an inadvertent error or an
unintentional withdrawal of the exemption. If that be so, the exemption no-
tification dated 6-7-2016 must be viewed as clarificatory or curative in na-
ture. Any other view would leave the said class of exporters uncovered for
a period of about three weeks allowing the department to levy the export
duty which is a wholly unintended consequence of the Government of
India policy.
16. We have formed this opinion on the basis of precedence of the
Supreme Court and this Court. In case of W.P.I.L. Ltd. v. Commr. of C. Ex.,
Meerut reported in 2005 (181) E.L.T. 359 (S.C.), the Supreme Court consid-
ered a case where an exemption notification was withdrawn and a fresh no-
tification was issued shortly thereafter exempting duty of excise on parts
used in manufacturing of power driven pumps. The Court noted that there
was a consistent policy of the Government of India to grant such exemp-
tion. The later notification did not grant exemption for the first time. It was
held that such notification was merely clarificatory and hence would apply
with retrospective effect.
17. Likewise in case of Ralson (India) Ltd. v. Commr. of C. Ex., Chandigarh-I
reported in 2015 (319) E.L.T. 234 (S.C.), the facts before the Supreme Court
were that the Government of India had issued exemption notification in
case of compounded rubber. Such exemption was withdrawn by notifica-
tion dated 1-3-1994 but was reintroduced by a notification dated 28-3-1994.
The period between 1-3-1994 to 27-3-1994 was uncovered. The Supreme
Court relying on the decision in case of W.P.I.L. Ltd. (supra) held that the
later exemption notification would apply during the interregnum period
also.
18. In case of Gujarat Paraffins Pvt. Ltd. v. Union of India, reported in 2012
(282) E.L.T. 33 (Guj.) the Division Bench of this Court considered a case
where the Government of India had taken corrective measure of reintro-
ducing the exemption after a gap of about 16 months. The Court held that
such exemption would have retrospective effect.”
3.3 Reliance was also placed upon the decision of the Supreme Court in
the case of State of Bihar v. Suprabhat Steel Ltd., (1999) 1 SCC 31, wherein the Court
held thus :-
“7. Coming to the second question, namely the issuance of notification by
the State Government in exercise of power under Section 7 of the Bihar Fi-
nance Act, it is true that issuance of such notifications entitles the industrial
units to avail of the incentives and benefits declared by the State Govern-
ment in its own industrial incentive policy. But in exercise of such power it
would not be permissible for the State Government to deny any benefit
which is otherwise available to an industrial unit under the Incentive Policy
itself. The Industrial Incentive policy is issued by the State Government af-
ter such Policy is approved by the Cabinet itself. The issuance of the notifi-
cation under Section 7 of the Bihar Finance Act is by the State Government
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