1982 (3) TMI 69 - HC - Central Excise

Summary

Issues:
Challenge to demand for excise duty based on notification annexure 'C' pre-1-3-1973 and discrimination in excise duty rates between manufacturers of flats from ingots.

Analysis:
The petitioner-firm challenged the demand for excise duty based on notification annexure 'C' on the grounds that the goods were manufactured before 1-3-1973, questioning the recoverability of excise levy on such goods. Additionally, they argued that the proviso in the notification was discriminatory and violated Article 14 of the Constitution of India. The petitioner highlighted the differing excise duty rates imposed on manufacturers of flats from ingots sourced from Mini-Steel Plants and Main Steel Plants, leading to varying excise duty burdens based on the source of ingots.

The petitioner-firm also contested the vires of sub-rule (1) of Rule 8, alleging excessive delegation of legislative power by the Central Government in granting exemptions from excise duty. However, in light of rule 9-A (1) (ii) of the Rules and the precedent set by the Supreme Court in Orient Weaving Mills (P) Ltd. case, the challenge to the vires of sub-rule (1) of Rule 8 was not upheld. The Court found no merit in the contention that the rule suffered from excessive delegation of legislative power.

Regarding the discrimination in excise duty rates between manufacturers of flats from ingots, the Court analyzed the impugned notification annexure 'C' and concluded that it did not impose any additional burden through excise levy. The Court noted that while one manufacturer received a lesser exemption compared to the other, the intention was not to provide less concession but to club the excise duty on ingots with that on the products manufactured from them. The Court emphasized that the proviso in the notification did not increase the excise duty burden but aimed to provide relief to manufacturers of flats from the ingots.

In the final assessment, the Court dismissed the petition, ruling that the impugned notification was not discriminatory as it aimed to balance excise duty obligations on manufacturers of flats from ingots. The Court highlighted that striking down the proviso would not benefit the petitioner-firm unless a modified notification with uniform exemptions was issued by the Government. The dismissal of the petition was made with no order as to costs, concluding the legal proceedings on the matter.