1988 (7) TMI 67 - HC - Central Excise

Summary

Issues:
1. Challenge to excise duty notification on polythene lined kraft paper and waxed kraft paper.
2. Interpretation of manufacturing process under Central Excises and Salt Act, 1944.
3. Application of previous judgments on similar cases.

Analysis:
1. The petitioner, a producer of bituminised polythene lined kraft paper and waxed kraft paper, challenged the excise duty notification imposing duty on these products under Tariff Item No. 17(2) of the Central Excises and Salt Act, 1944. The petitioner argued that the raw materials had already suffered excise duty and contended that the production process did not amount to manufacturing as per the Act. The notification was amended multiple times, increasing the duty percentage. The key issue was whether the duty collection was justified under the circumstances.

2. The respondents argued that the production of polythene linked kraft paper and waxed kraft paper constituted manufacturing under the Act. They cited a previous judgment, East Coast Papers, where it was held that the process of bonding paper with polythene amounted to manufacturing. The respondents emphasized that the petitioner had not availed certain procedures or exemptions that could affect the duty liability. The court considered the commercial use and distinct character of the products to determine their classification under the tariff item.

3. The petitioner sought a remand based on a different judgment, W.A. No. 326 of 1981, asserting that their case aligned with that decision. However, the respondents relied on the East Coast Papers judgment and subsequent Division Bench confirmation to support their position. The court referenced past judgments to establish consistency in interpreting similar cases and ultimately dismissed the writ petition, allowing the petitioner to present representations to the authorities for further consideration without costs awarded. The decision was based on the similarity of facts to the East Coast Papers case and the application of relevant legal principles.