9911796707
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Issues:
Challenge to orders for exemption under Notification dated June 16, 1976; Procedure for determining base periods and clearances under the Notification; Classification of factories under different categories; Allegations of illegal levying and collecting central excise duty without granting exemption; Interpretation of manufacturer under Section 2(f) of the Act; Dispute over ownership transfer and entitlement to exemption benefits; Validity of Trade Notice issued by the Collector of Central Excise, Calcutta; Authority to modify exemption Notification terms; Whether conditions for exemption should be part of the Notification; Jurisdiction of administrative actions in imposing conditions; Assessment of excise duty on the value of goods at the time of clearance. Analysis: The petitioner, a tea company, challenged orders seeking exemption under a 1976 Notification, alleging that the procedure followed by the Assistant Collector of Central Excise did not align with the Notification's provisions. The petitioner argued that base periods and clearances for different factory categories should be determined separately as per the Notification, emphasizing that clearances made before their ownership of tea gardens should not be considered. The petitioner contended that the Collector's Trade Notice deeming factories with changed ownership as not 'new' was illegal. The respondents argued that the petitioner effectively became the manufacturer upon agreement with Sterling Tea Companies in 1973, thus eligible for exemption benefits under the Notification. The petitioner's counsel argued that the Notification allowed duty exemption on clearances exceeding base clearances, emphasizing that exemption eligibility should not be affected by ownership changes in factories. The counsel highlighted that only the Government could modify Notification terms, not the Collector through a Trade Notice. The respondents' counsel countered the petitioner's claims, asserting that the petitioner's acquisition of tea gardens' rights and liabilities rendered the challenge baseless. The Court noted that conditions for exemption should be explicitly stated in the Notification and not imposed through administrative actions. It cited precedents to clarify that excise duty is chargeable on goods' value at clearance time, emphasizing that duty assessment does not fix the duty incident point. The Court rejected the petitioner's argument that they did not qualify as a manufacturer under the Act, finding the challenge to the orders and Trade Notice meritless. Consequently, the writ petition was dismissed, with all interim orders vacated, and no costs awarded. The prayer for stay was also refused.
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