1992 (7) TMI 85 - HC - Central Excise

Summary

Issues:
1. Excise duty charge on Ultramarine blue products.
2. Interpretation of a government notification exempting Ultramarine blue from duty.
3. Comparison with a Supreme Court judgment regarding manufacturing processes.

Analysis:
The judgment revolves around the excise duty charge on Ultramarine blue products manufactured and sold by the petitioner. The petitioner argued that since the Ultramarine blue is sold in small packets without undergoing any further manufacturing process, it should be exempt from excise duty. The court noted a government notification dated 16th December 1991 exempting Ultramarine blue from duty under certain conditions, specifically mentioning that duty should have been paid when the product was initially manufactured in bulk. The court found no dispute regarding the payment of excise duty by the petitioner on the bulk product, leading to the conclusion that the writ petition must succeed based on the notification.

Furthermore, the judgment referred to a Supreme Court case where a similar issue of manufacturing processes was addressed. The court cited the case of Lathia Industrial Supplies Co. Pvt. Ltd. v. Collector of Central Excise, highlighting a notification exempting certain processes from being considered as manufacturing. The court emphasized that the law should not differ before and after the issuance of such notifications. Drawing parallels, the court concluded that the same principle should apply in the present case, indicating that the packing of Ultramarine blue products into small packets should not be considered a new manufacturing process.

In the final order, the court ruled in favor of the petitioner, granting the relief sought in the prayer of the petition. Any interim orders were vacated, allowing the petitioner to withdraw any deposited amounts related to the Ultramarine blue products. The judgment also refused the prayer for a stay of the order and instructed all parties, including the bank involved, to act upon the signed copy of the operative part of the order. No costs were awarded in the case, bringing a comprehensive conclusion to the legal proceedings.