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TMI Blog2009 (6) TMI 666X X X X Extracts X X X X X X X X Extracts X X X X ..... excise. No other provisions in the Act empowers the Government from granting such an exemption. - Notification is issued beyond the power and competence of the Government and hence it is not sustainable. It is settled law that a policy decision cannot be permitted to contradict the provisions of the statute or its legislative object. Therefore the exemption granted through Ext. P1 which is in violation of the provisions of the Act, and its legislation object could not be held valid, even if it is issued as a policy decision taken by the Government, writ petition is allowed quashing the notification. X X X X Extracts X X X X X X X X Extracts X X X X ..... of excise so collected, reduced by cost of collection as determined by the Central Government, shall first be credited to the 'Consolidated funds of India', and then be paid by the Central Government to the Board for being utilised for the purpose of the said Act, if Parliament by appropriation made by law in this behalf so provides. It is pointed out by Sri. Bechu Kurian Thomas, learned counsel for the petitioner, that till 1960 the liability to pay excise duty under Section 12(1) was on the owner of the estate in which rubber is produced. But by an amendment to Section 12(2), the liability for payment was extended also to the manufacturer by whom such rubber is used. As per the amended provision the Rubber Board shall collect the duty either from the owner of the estate on which rubber is produced or from the manufacturer by whom such rubber is used. It is specifically pointed out that the incidence of taxation as prescribed under Section 12(1) is on production of the rubber within the country. The wording of Section 12(1) is to the effect that the cess shall be levied as a duty of excise on all rubber produced in India. Merely because the liability has been extended also to manu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of duty is deferred till the purchase of the rubber by manufacturer. 6. Based on the settled legal positions as above, Sri. Bechu Kurian Thomas submitted that the Rubber Cess is not an excise duty attached to the manufacturers on their production, but it is the duty leviable on Rubber produced in the country. The duty of excise so collected being an amount credited to the 'Consolidated fund of India', and being paid by the Central Government to the Rubber Board for utilization for the purposes of the Act, the exemption granted to a group of manufacturers from payment of such duty is totally beyond the scheme of the Act, and it is totally lacking competence. It is contended that fixation of "Zero paise per Kg" as rate of cess in Ext. P1, is virtually an exemption granted from payment of cess to certain manufacturers. It is evident from usage of such terms that the Central Government is aware about its inability to exempt any group of manufacturers. So the attempt is clear, that it is indirectly providing exemption to certain groups from payment of cess, which the Government cannot do directly. It is settled principle of law that the Government cannot do something which they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Supreme Court would not be without jurisdiction as it is subject to judicial review. Broadly a policy decision is subject to judicial review on the following grounds : (a) if it is unconstitutional; (b) if it is dehors the provisions of the Act and the regulations; (c) if the delegatee has acted beyond its power of delegation; (d) if the executive policy is contrary to the statutory or a larger policy. In P.J. Irani v. State of Madras (AIR 1961 SC 1731) it is held by the Hon'ble Supreme Court that a subordinate legislation can be challenged not only on the ground that it is contrary to the provisions of the Act or other statutes; but also if it is violative of the legislative object. The provisions of the subordinate legislation can also be challenged if the reasons assigned therefor are not germane or otherwise mala fide. Further in Bombay Dyeing and Manufacturing Co. Ltd. v. Bombay Environmental Action Ground and Others [2006 (3) SCC 434] the Hon'ble Supreme Court observed that a policy decision, as is well known, should not be lightly interfered with, but is difficult to accept the submission that the courts cannot exercise their power of judicial review at all. By r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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