1997 (2) TMI 237 - AT - Central Excise

Summary

Issues:
1. Dispute over Central Excise duty payable on assessable value of levy sugar.
2. Interpretation of Proviso (ii) to Section 4(1)(a) of the Act.
3. Effect of High Court intervention on the price fixation of levy sugar.
4. Refund claim for excess duty paid by the appellant.

Detailed Analysis:

1. The appellant, engaged in sugar manufacturing, faced a dispute regarding the Central Excise duty payable on levy sugar sold during a specific period. The Government fixed the levy sugar price, leading to a legal challenge by the appellant and others via a Writ Petition before the High Court of Allahabad. The High Court's interim order allowed selling levy sugar at a different price than the fixed levy price, with conditions for depositing the excess amount. Subsequently, the High Court quashed the levy price fixation by the Government, directing the refund of deposited amounts. The appellant sought a refund of excess duty paid based on the difference between the fixed and sold prices.

2. Proviso (ii) to Section 4(1)(a) of the Act was crucial in determining the normal price for duty calculation. The provision states that if goods are sold at a price fixed by law, that price is deemed the normal price for duty assessment. The appellant argued that since the levy sugar price was lawfully fixed, the duty should be based on that amount, warranting a refund of excess duty paid.

3. The judgment highlighted the impact of the High Court's intervention on the price fixation issue. Despite the initial fixed price by law, the High Court's orders altered the selling price, leading to confusion regarding the correct assessable value for duty calculation. The High Court's decision to quash the levy price fixation implied that during the relevant period, there was no valid law fixing the price. Consequently, the appellant was required to pay duty on the revised assessable value determined by the High Court, precluding any entitlement to a duty refund.

4. Ultimately, the Tribunal found no valid grounds to interfere with the lower authorities' decisions and dismissed the appeal. The judgment emphasized the necessity of paying duty based on the correct assessable value, as determined by the High Court's intervention, thereby rejecting the appellant's claim for a refund of excess duty paid during the disputed period.