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TMI Blog1970 (5) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... it used to obtain supplies of such jute goods from other jute mills and also took such jute goods from its own mills at Champdani. By Section 16 of the Finance Act, 1962 Entry 22A was introduced in the First Schedule to the Central Excises and Salt Act, 1944. The said item was as follows:-- 22A.-- Jute manufactures (including manufactures of bimplipatam jute or of mesta fibre), all sorts of (i) hessian .... ₹ 250 /- per metric tonne (since increased to ₹ 450/-); (ii) all other descriptions of jute manufactures not otherwise specified (including cloth bags, twist yarn, rope and twine) .... ₹ 125/- per metric tonne (since increased to ₹ 250/-). ( 2. ) The petitioner's case is that since, the imposition of Excise Duty on Jute manufactures it had been purchasing jute goods from other mills on which Excise Duty had already been paid. So far as supplies obtained from the petitioner's own mill were concerned. Excise Duty was being paid on the same being transferred from the petitioner's jute mill to the Converter Unit. Disputes and differences arose between the petitioner and the Central Excise Collector as to whether Excise Duty was payable on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was summarily rejected by the Collector by his order dated the 3rd June, 1964 on the ground that he saw no reason to interfere with the order of the Assistant Collector. The petitioner was further notified that a revision lay from the appellate order to the Central Government under Section 36 of the Act. The petitioner did file a revision application dated the 1st July, 1964 to the requisite authority, viz., the Ministry of Finance (Department of Revenue) and by its order dated the 11th February, 1965 the revision application was also summarily rejected. By a notification dated the 20th March, 1965 made under Rule 8 (1) of the Central Excise Rules the Government of India exempted laminated jute products from so much of the -duty leviable thereon as was in excess of the duty payable on unprocessed jute manufactures used in the manufacture of jute products. The said notification came into effect from the 20th March, 1965. A notice of demand dated the 9th October, 1967 for a total sum of ₹ 6,40,068.01 was demanded from the petitioner towards Central Excise Duties (basic and special) on the differential weight of the jute manufactures received from outside and cleared afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nov. 1963 was in the nature of executive instructions, that the Assistant Collector had no statutory authority to pass an order exempting any product from excise duty, that the proper authority to make such an order was either the Central Government or the Collector and as such the aforesaid notification or order had no binding effect. It is further contended that prior to the exemption granted by the Statutory Notification dated the 20th March, 1965 laminated jute products continued to remain jute manufactures and were accordingly dutiable under Item 22A. It is also contended that the alleged direction contained in the said purported notice of the 21st November, 1963 could not override the provisions of the Statute and of the Rules and Notifications made thereunder. It is further submitted that Rule 10 presupposes a levy of duty or original assessment, but in the instant case there has been no such levy or assessment on the petitioner in regard to the goods on which differential duty has now been demanded and as such the residuary power under Rule 10A has been correctly invoked. In any event if reference to Rule 10A is erroneous, then the Notice could not be bad because reference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revision application have been summarily rejected. The petitioner has also made a large number of representations to the different authorities against the Notice of Demand but without any success as would appear from the letter dated the 30th March, 1968 from the Assistant Collector of Customs being Annexure 'H' to the petition. It is, therefore useless to require the petitioner to again go up on appeal and further revision against the impugned demand. In this case, in my opinion, the Court would be amply justified in exercising its discretion to issue high prerogative writs if otherwise satisfied. The real question in issue in this case is whether in processing jute cloth or jute fabrics by lining them without polythene and other plastic material or bitumen the petitioner was manufacturing any jute goods within the meaning of Item 22A of the first Schedule to the Central Excises and Salt Act. The Item itself gives some examples of what is meant by jute manufactures, such as, hessian, jute cloth, bags, twist, yam, rope and twine as also fibres made from raw jute, I have myself examined the socalled polythene laminated jute cloth, samples of which have been produced for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c with a solution would not change the character of the product and transform it into another product which can also be described as a new manufacture of jute goods. It is undoubtedly a manufacture of new goods or new kind or goods but it is not a manufacture of jute goods. What is, therefore, being charged under the impugned notice of demand being the difference in weight of the laminated jute goods and the raw jute goods, is the weight of the materials used for lamination, that is, polythene, gum tape and other adhesive materials used for making the coating. No duty is chargeable on such materials. The authorities are trying to do indirectly what they could not do directly, namely, charge excise duty on articles used for laminating jute products. ( 4. ) In the view I am taking, it is not necessary to decide the other questions that were raised, namely, whether Rule 10 or Rule 10A was applicable in this case and whether the petitioners were entitled to raise any objections without applying under Rule 9. In my opinion, no Excise Duty is chargeable in respect of the differential weight, i. e., the weight of the materials used for lamination as has been done in the impugned not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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