' The appellant a company limited by share is engaged in manufacturing of containers of iron and steel for storage of compressed or liquefied gas. The Additional Collector, Lahore on 11-12-1998 served them with a show-cause notice as to why they should not be held to have evaded central excise duty amounting to Rs,72,00,000. Earlier it was pointed out that the staff of the Central Excise Headquarters Intelligence, Lahore had visited their factory premises at Kala Shah Kaku, on 13-10- 1998 and had reported that the company was manufacturing the aforesaid container3 but clearing them without payment of central excise duty.
2. In reply the appellant inter alia stated that the bullets being manufactured by them for the storage of L.P.G. Were not containers as envisaged in the heading 7311.0000 of the 1st Schedule to the Central Excises Act, 1944. It was explained that these bullets were meant for installation for storage of L.P.G. As part of the main plants and as such they were exempted from payment of central excise duty being covered by heading 7310.1010. In this regard a reference was also made to concessionary Notification S.R.O. No,501(1)/94, dated 9-6-1994.
3. The Adjudicating Officer, however, rejected the averments made in this regard and proceeded to hold that the containers referred to in the aforesaid letter were meant for storage, transport and packing of goods. Further that the goods cleared by the appellant/company were containers for compressed or liquefied gas which were classifiable under PCT Heading No,7311.0000 of the 1st Schedule to the Act and therefore, were liable to central excise duty at a rate of 10% ad valorem Vide S.R.O. No,456(I)/96, dated 13-6-1996.
4. On further appeal a Division Bench of the learned Tribunal by way of their order, dated 2-7-2001 agreed with the Revenue Authorities. While doing so the learned Division Bench observed that to some extent the PCT Headings 7309, 7310 and 3711 were overlapping. However, according to the learned Tribunal on a close examination of the three entries when read with S.R.O. No,456(I)/97 it emerged that L.P.G. Bullets were out of the ambit of the exemption contemplated in S.R.O.
No,455(I)/96 and, therefore, were liable to central excise duty.
5. Heard the learned counsel for the parties at pre-admission stage. According to the learned counsel for the appellant both the aforesaid S.R.Os. Needed to be read together and when so done, the goods being manufactured by the appellant were clearly found covered by the exemption/concessionary Notification S.R.O. No,455(I)/96. Also refers to the aforesaid observations of the Tribunal that the three PCT Headings appeared overlapping. According to the learned counsel for the appellant in such situation when there was some kind of ambiguity it should have been resolved in favour of the tax-payers.
6. Learned counsel for the Revenue, however, supports the impugned order for the various reasons given therein.
7. After hearing the learned counsel for the parties, we are persuaded to agree that the goods manufactured and cleared by the appellant/company were covered by PCT Heading 7311.0000 which exclusively related to containers made of steel and iron meant for compressed or liquefied gas. The goods mentioned in heads 7309.0000 and 7310.0000 covered various types of storage tanks and containers except those properly falling under PCT Heading 7311.0000. The nature of containers covered by concessionary Notification S.R.O. No,455(I)/96, dated 13-6-1996 were only those which were designed to be used exclusively as storage tanks and ammunition boxes.
However, as noted earlier, the goods manufactured by the company were of specific nature which was covered by PCT Heading 7311 and none else. That PCT Heading 7311.000 is meant to cover containers for compressed or liquefied gas of iron or steel. According to. S.R.O. No,456(I)/96 these containers were liable to 10% as ad valorem excise duty. The principle that a specific head should be invoked where goods fall under both specific as well as general heads is applicable in the present case. The appellant having not disputed the nature of the goods manufactured by it as also the PCT head under which it was covered, mere reference to another concessionary S.R.O.
Which was general in nature will hardly be of any avail.
8. The second limb of the argument of the learned counsel that in case of ambiguity the matter ought to have been resolved in favour of the assessee is also not correct. That principle is applicable only in respect of charging provisions. When it comes to a claim of exemption, the law is settled. It is that claim of exemption pre-supposes the levy of duty and in such situation, the burden of proof squarely falls on the person claiming exemption. Secondly that while interpreting the provisions granting exemption the Courts will lean towards the revenue rather than the assessee. If an authority is needed one may consult re: Army Welfare Sugar Mills Ltd. v. Federation of Pakistan 1992 SCM R 1652.
9. That being so we find no fault with the impugned order of the Tribunal.
10. Dismissed in limine.