1989 (1) TMI 138 - HC - Central Excise

Summary

Issues involved: Challenge to levy of duty on Electricity under Central Excises & Salt Act, 1944 as amended by Section 36 of Finance Act 1978.

Summary:
The petitioner, a Company engaged in manufacturing paper and paper board, challenged the levy of duty on electricity under the Central Excises & Salt Act, 1944. The petitioner argued that the inclusion of electricity as excisable goods for taxation purposes was beyond the Legislative power. The petitioner contended that electricity does not qualify as goods under the Constitution. However, the Court held that electricity is considered goods under the Act and is liable to be taxed. The Court emphasized that the power to levy tax on goods is broad and includes electricity, as per the Constitution.

The petitioner also argued that the Parliament's inclusion of electricity as goods for taxation was inconsistent with legislative wisdom. The Court disagreed, stating that the Parliament's decision to include electricity for tax purposes was valid. The Court held that electricity is considered goods and its generation qualifies as manufacture or production under the Act.

In conclusion, the Court dismissed the writ application, ruling that electricity is indeed goods and subject to taxation under the Act. The Court highlighted the importance of compliance with court orders and noted the dismissal of the application with no costs awarded.

[Judgment per: S.C. Mohapatra, J.]
[Per: H.L. Agrawal, CJ]