1998 (2) TMI 129 - HC - Central Excise

Summary

Issues:
1. Interpretation of excise duty liability in cases of discounts not availed by customers.
2. Challenge to the Department's stand on excise duty calculation.
3. Applicability of previous judgments by the Appellate Authority, Bombay High Court, and Supreme Court on excise duty liability.
4. Persistence of the Department in issuing show cause notices despite previous judgments.
5. Submission of replies to show cause notices by the petitioner.
6. Intent of the Department to challenge previous orders.

Analysis:
1. The petitioner challenged the Department's stance on excise duty calculation regarding discounts not availed by customers. The Appellate Authority, through Annexure-A order, upheld the petitioner's claim that duty should be payable on the discounted value of goods regardless of customers availing the discount benefit. This decision was based on the understanding that the discount was available to interested customers and known at the time of sales, as indicated in the invoice itself.

2. Subsequent assessments by the authorities, following the principles laid down by the Bombay High Court in a specific case, affirmed the petitioner's liability to pay excise duty on the discounted price of goods. The orders, including Annexure B, were in line with the Bombay High Court's decision, which was later confirmed by the Supreme Court. Despite these legal precedents, the Department persisted in issuing show cause notices, as evidenced by Annexures E and F, demanding excise duty payment on goods where discounts were not availed by customers.

3. The petitioner contended that the Department's actions were unjustified in light of the previous judgments by the Appellate Authority, Bombay High Court, and Supreme Court. The petitioner's counsel highlighted that the Department should not make fresh demands for excise duty considering the legal precedents and the illegality of the levy as declared in Annexures A and B orders.

4. The Central Government Standing Counsel for the respondents indicated an intention to challenge the previous orders, but the Court emphasized that the Department was currently bound by the findings of the Appellate Authority and the higher court judgments. The Court directed the Department to adhere to the previous decisions while dealing with the objections raised by the petitioner in response to show cause notices. The final decision on Annexures E and F was to be made in line with the findings of the Appellate Authority and the decisions of the Bombay High Court and the Supreme Court, thereby disposing of the writ petitions.