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Issues Involved:
1. Classification of cycle lamps as parts or accessories. 2. Applicability of Rule 10 of the Central Excise Rules, 1944. 3. Maintainability of the writ petition under Article 226 of the Constitution. Summary: 1. Classification of Cycle Lamps: The petitioner company manufactures cycle lamps, which were initially classified as cycle parts and exempted from duty u/r 8 of the Central Excise Rules, 1944, as per Notification No. 55/75 and Notification No. 102/80. The Assistant Collector issued a show cause notice on 24-10-1980, arguing that cycle lamps are not parts of cycles and thus not eligible for exemption. The petitioner contended that cycle lamps are specifically designed for cycles and are considered parts by the trade and consumers. The court, however, held that the popular commercial view should be adopted, citing the Supreme Court's ruling in State of U.P. v. Kores (India) (A.I.R. 1977 S.C. 132), which distinguished between parts and accessories. The court concluded that cycle lamps are accessories, not parts, and thus not eligible for exemption. 2. Applicability of Rule 10: The petitioner argued that Rule 10 would not apply as the exemption was granted and the demand was raised without cancelling the exemption. The court found that the show cause notice assumed the exemption was not applicable without formally withdrawing it. The court held that during the currency of the exemption, no assessment could be made, and the show cause notice and subsequent order were invalid. 3. Maintainability of the Writ Petition: The court addressed the maintainability of the writ petition under Article 226, stating that it could examine the correctness of a classification. The court overruled the revenue's objection, affirming that classification issues fall within writ jurisdiction. Conclusion: The court quashed the impugned order and the show cause notice, granting liberty to the respondent to proceed afresh if permissible by law. The writ petition was allowed, and no costs were ordered.
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