1970 (11) TMI 42 - HC - Central Excise

Summary

Issues:
1. Liability of the petitioner to pay excise duty on re-rolled M.S. rounds.
2. Applicability of Central Excises and Salt Act, 1944 and Tariff Item 26AA.
3. Jurisdiction and validity of demand notices issued by the Inspector of Central Excise.
4. Definition of "manufacturer" as per the Act.
5. Dispute over liability between the petitioner and the 5th respondent.

Detailed Analysis:
1. The petitioner, a firm engaged in re-rolling business, contested the demand notices issued by the Inspector of Central Excise for payment of excise duty on M.S. rounds re-rolled from duty-free rails supplied by the 5th respondent. The petitioner argued that they were not liable to pay excise duty as they were not manufacturers of excisable goods. They contended that the demand notices were invalid and sought relief from the court.

2. The respondents, including the Union of India and Central Excise authorities, countered the petitioner's arguments by asserting that M.S. rounds fell under the category of "iron and steel products" as per Tariff Item 26AA of the Central Excise Tariff. They claimed that the petitioner's activities qualified as manufacturing under the Act, thereby justifying the imposition of excise duty. The respondents also cited Rule 10A to support the validity of the demand notices.

3. The court analyzed the definition of "manufacture" under the Act, which encompassed any process related to the completion of a manufactured product. The court concluded that the petitioner's re-rolling of M.S. rounds constituted manufacturing, thereby making them liable for excise duty. The court dismissed the petitioner's arguments regarding their non-inclusion in the definition of manufacturer and upheld the validity of the demand notices. The court ruled against the petitioner, stating that they were not entitled to the requested relief, and dismissed the writ petition with costs.

4. The dispute over liability between the petitioner and the 5th respondent regarding the payment of excise duty was not conclusively addressed in the judgment, as the focus was primarily on the petitioner's classification as a manufacturer under the Act. The court did not delve into the contractual relationship between the parties but emphasized the legal obligations arising from the manufacturing activities of the petitioner.