Tax/Indirect Tax : Addition of New Provision in Tax Legislation and Its Effect Explained

Tax/Indirect Tax : Addition of New Provision in Tax Legislation and Its Effect Explained 

In case of CCE v. Milton Polyplas (I) Pvt Ltd [2019] GCtR 6450 (Bombay),  it was held that "Section 38A of the Central Excise Act, 1944 (inserted in 2001 with retrospective  effect  from  1944) will  make  the  notice  dated  17th January, 2000 valid even post 1st  April, 2000. This is in view of  Section   38A   (c)   of   the   Act   which  states   that   any   amendment, repeal,   supersession   or   rescinding  shall   not   affect   any   right, privilege, obligation or  liability acquired, accrued or incurred under any rule so amended, repealed, superseded or rescinded." 

This is further  qualified by providing  that   any   investigation,   legal proceedings   may   be   continued,   as   if   the     Rule   had   not  been amended, rescinded, repealed or superseded. In  fact, the   above provision is an amalgamation of Section 6 & 6A of the General Clauses Act, 1897 which applies to Acts, while Section 38A of the Act is specifically in relation to Rules under the Act. 

In this case the petitioner was engaged in manufacturing insulated wares of plastics such as insulated casseroles and tiffin (said goods)  on  job work basis for M/s. Milton Plastics Ltd., The said good fall  under Chapter 39  of the First  Schedule to the Central Excise Tariff Act, 1985 (the Tariff Act). It has challenged the action of the Department and had succeeded in CESTAT, however, in HC, Department was able to get the relief.