9911796707
|
Home
Issues:
Interpretation of exemption Notification No. 122/71 for excise duty on phenolic resins. Analysis: The case involved a partnership firm manufacturing Phenol formaldehyde moulding powder, claiming it falls under phenolic resins for excise duty purposes. The Union Government issued exemption Notification No. 122/71, providing concessional rates for phenolic resins. The excise authorities initially accepted the product as phenolic resin, allowing concessional duty. However, they later issued show cause notices demanding higher duty rates without providing substantial grounds for the change. A Division Bench of the High Court quashed the initial show cause notices, directing the authorities to issue fresh notices based on legal principles and fresh evidence. Subsequently, fresh show cause notices were issued, but the petitioners challenged them, citing lack of additional evidence. The final decision hinged on a Government of India order in a similar case, where Phenol Formaldehyde Moulding Powder was treated as phenolic resin eligible for concessional duty under Notification No. 122/71. The High Court found the fresh show cause notices ultra vires, as they did not adhere to legal principles or consider the Government's decision. The Court emphasized that the authorities failed to fulfill the qualified liberty granted to issue fresh notices based on correct legal principles and fresh evidence. Consequently, the Court allowed the petition, quashed the show cause notices, and directed the respondents to refund the excess duty amount claimed by the petitioners, with a deadline for refund set by the Court. The judgment highlighted the importance of following legal principles and considering relevant government decisions in excise duty matters.
|
