1991 (2) TMI 114 - HC - Central Excise

Summary

Issues:
Classification of potentiometers and switches for duty levy under Central Excise Tariff Act, 1985; Benefit under Notification No. 175 of 1986; Violation of principles of natural justice in issuing demand order without opportunity for appeal.

Analysis:
The petitioner, a manufacturer of potentiometers and switches, challenged the duty levy on component parts under the Central Excise Tariff Act, 1985. The petitioner argued that under the earlier tariff, component parts were not duty payable. The Collector (Appeals) directed the Assistant Collector to reconsider the duty liability in light of Notification No. 175 of 1986, granting benefits to small scale industries. However, the Assistant Collector issued an impugned demand order without complying with the remand order or providing the petitioner an opportunity to appeal, violating principles of natural justice.

The respondent contended that a writ does not lie against a mere letter and that the petitioner should make submissions before the first respondent for a proper decision. The High Court found merit in the petitioner's argument that the impugned demand order was illegal as it was issued before complying with the remand order and without giving the petitioner an opportunity. The Court held that the demand order violated natural justice principles and directed the first respondent to reevaluate the matter based on the Collector (Appeals) order.

In conclusion, the High Court allowed the writ petition, quashed the impugned demand order, and directed the Assistant Collector to redetermine the amount in accordance with the Collector (Appeals) order and the benefit claimed under Notification No. 175 of 1986. The Court emphasized providing the petitioner with a fresh opportunity to present their case and raise any new points under the law. No costs were awarded in the judgment.