1989 (8) TMI 90 - HC - Central Excise

Issues Involved:
1. Validity of Show Cause Notices and Requisitions.
2. Classification of Tyre Cord Warp Sheets under Central Excise Tariff.
3. Applicability of Excise Duty on Tyre Cord Warp Sheets.
4. Jurisdiction of the Respondent Authorities.
5. Prematurity of the Petitioner's Objections.

Issue-wise Detailed Analysis:

1. Validity of Show Cause Notices and Requisitions:
The petitioner challenged the Show Cause Notices dated October 31, 1980, November 4, 1980, November 29, 1980, January 30, 1981, and the requisition dated October 29, 1980. The petitioner argued that these notices and requisitions were irregular and illegal. However, the Court found that the notices and requisitions were neither irregular nor invalid. The Court emphasized that the petitioner should respond to the notices and provide explanations, allowing the matter to be adjudicated properly.

2. Classification of Tyre Cord Warp Sheets under Central Excise Tariff:
The petitioner contended that tyre cord warp sheets should not be classified as 'fabric' under Item Nos. 19 to 22 of the Central Excise Tariffs. The petitioner argued that technological advancements had changed the nature of the product, and it no longer fit the definition of 'fabric'. The respondent authorities, however, issued a Trade Notice No. 154/Cotton Fab.-10CE/80 dated September 30, 1980, classifying tyre cord warp sheets under Item No. 19 or 22 based on the content of fabric or yarn used. The Court did not find merit in the petitioner's challenge to this classification and held that the matter should be adjudicated by the respondent authorities.

3. Applicability of Excise Duty on Tyre Cord Warp Sheets:
The petitioner claimed that the tyre cord warp sheets, being an intermediary product in a continuous manufacturing process, should not attract excise duty. The petitioner argued that the application of non-vulcanised rubber and other materials did not amount to 'manufacture' as defined under Entry 84 of List I of the 7th Schedule to the Constitution. The Court referred to the amendments made by the Central Excises and Salt and Additional Duties of Excise (Amendment) Act, 1980, which included certain processes as 'manufacture'. The Court held that the respondent authorities were justified in issuing the notices and that the petitioner should respond to them to clarify the applicability of excise duty.

4. Jurisdiction of the Respondent Authorities:
The petitioner argued that the respondent authorities lacked jurisdiction to issue the impugned notices and requisitions. The Court referred to the principles laid down in A.I.R. 1962 S.C. Page 1893, stating that a writ of prohibition could be issued if a quasi-judicial authority acted without or in excess of jurisdiction. However, the Court found that the respondent authorities had the jurisdiction to issue the notices and adjudicate the matter. The Court emphasized that the Writ Court should not interfere with the adjudicating process unless there was a clear lack of jurisdiction or manifest injustice.

5. Prematurity of the Petitioner's Objections:
The Court found that the petitioner's objections were premature. The petitioner had the opportunity to respond to the show cause notices and present evidence to support their claims. The Court held that the petitioner should explain why the products did not attract excise duty and allow the respondent authorities to adjudicate the matter. The Court did not find any merit in the petitioner's challenge to the notices and requisitions.

Conclusion:
The Court concluded that the impugned notices and requisitions were valid and justified. The petitioner's objections were premature, and the matter should be adjudicated by the respondent authorities in accordance with the law. The Court discharged the Rule, vacated all interim orders, and did not award any costs.

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