1982 (5) TMI 183 - HC - Central Excise

Summary

Issues:
Leviability of excise duty on the manufacture of acrylic plastic sheets, tubes, and plastic bangles from Monomer, both regenerated and virgin.

Analysis:
1. The petitioners, engaged in manufacturing acrylic plastic products, challenged the levy of excise duty on their products made from Monomer, both virgin and regenerated. The petitioners claimed exemption from excise duty under Notification No. 38/73 as amended, arguing that their products fall outside the scope of excise duty.

2. The respondents contended that the petitioners' products, specifically acrylic plastic bangles tubes, are excisable under Tariff Item No. 15A(2) of the Central Excises and Salt Act, 1944. The respondents argued that the exemption under Notification No. 38/73 does not apply to acrylic plastic bangles tubes, making the petitioners liable for excise duty since 1975.

3. The central question before the court was whether the acrylic plastic products manufactured by the petitioners are exempt from excise duty under Tariff Item No. 15A(2). The court analyzed the relevant provisions of Item No. 15A and its sub-items to determine the applicability of excise duty to the petitioners' products.

4. The court interpreted Item No. 15A(2) which covers "Articles made of plastics," including various plastic materials and products. The court emphasized that the raw material used in manufacturing the articles is crucial in determining excisability. Referring to a previous judgment by the Gujarat High Court, the court concluded that products made from Monomer through polymerization do not attract excise duty under Tariff Item 15A(2).

5. The court further clarified that acrylic plastic sheets and tubes, being intermediate products in the manufacturing process of plastic bangles, also do not fall under the category of "Articles made of plastics." Therefore, the court held that the petitioners' products, including acrylic plastic sheets, tubes, and bangles, are not subject to excise duty under Tariff Item No. 15A(2).

6. Given the court's interpretation of Tariff Item No. 15A(2) and the manufacturing process of the petitioners' products, the court ruled in favor of the petitioners. It declared that acrylic plastic sheets, tubes, and bangles are not liable for excise duty under the specified tariff item, restraining the respondents from levying excise duty on these products.

7. The judgment provides a detailed analysis of the legal provisions, previous court decisions, and the manufacturing process involved in determining the excisability of the petitioners' acrylic plastic products. The court's interpretation of the relevant tariff item led to the exemption of the petitioners' products from excise duty.