1984 (8) TMI 87 - HC - Central Excise

Summary

Issues:
1. Entitlement to refund of excess duty paid under the Central Excises and Salt Act.
2. Charging of excise duty on price inclusive of post-manufacturing expenses and profits.
3. Permission to clear the product on payment of excise duty on a price excluding post-manufacturing expenses and profits.
4. Amendment request regarding returnability of tin containers and its impact on assessable value.
5. Interpretation of Section 4(4)(d)(i) of the Act regarding returnable packing.
6. Rejection of the requested petition amendment.
7. Dismissal of the petition and discharge of rule with no order as to costs.

Analysis:

1. The petition involved a dispute regarding the entitlement to a refund of excess duty paid under the Central Excises and Salt Act. The petitioner, a private limited company engaged in manufacturing and marketing refined oil and vanaspati, sought relief from excise duty charged on the price inclusive of post-manufacturing expenses and profits. The company claimed that the product was sold in wholesale trade on a principal-to-principal basis, with the price being the sole consideration for the sale. The petition also aimed to clear the product by paying excise duty excluding post-manufacturing expenses and profits.

2. The judgment referred to a Supreme Court case known as the 'P.M.E.' case, which influenced the decision regarding the deduction of post-manufacturing expenses. The court found that the company was not entitled to deduct such expenses as per the Supreme Court's ruling. Additionally, the petition did not establish a case for the returnability of tin containers, which could impact the assessable value under Section 4(4)(d)(i) of the Act.

3. The court addressed the issue of the returnability of packing materials, emphasizing that the law included the cost of packing in the assessable value unless the packing was of a durable nature and returnable by the buyer to the assessee. The petition lacked any assertion of the packing being returnable, and the court rejected the request for an amendment to introduce this argument, citing belated submission and lack of merit.

4. Ultimately, the court dismissed the petition, discharged the rule with no costs, and allowed the respondents to enforce bank guarantees and commence recovery proceedings for the differential duty. The interim order was vacated, but at the petitioner's request, bank guarantees were not to be enforced until a specified date. The judgment highlighted the importance of timely and substantive pleadings in legal proceedings, emphasizing the need for parties to present their case thoroughly and promptly.