9911796707
TMI Blog1977 (10) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... td., is the manufacturer of cotton yarn. Up to 1968 the calculation for the purpose of Excise Duty were made in the New French Counts hereinafter referred to as "N.F. Counts". Thereafter, English counts were taken into consideration. As the counts of yarn cannot be manufactured with exactitude, the Government of India fixed the tolerance limit of 2.5% on the declared count in assessing the duty under the Central Excise Act. On 31st August 1966 the Central Excise Officer took samples and sent the same for chemical test. During the period from 31st August 1966 to 30th September 1966, the writ petitioner factory has cleared 42,279.9 kgs. of cotton yarn declaring the counts as 34 N.F. on payment of duty of Rs. 2,113.76 Ps. at the rate of Re. 0. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be 35.6 N.F. Relying on this opinion, the Government of India rejected the revision holding that-35.6 N.F. was also above 34 N.F. and we. also above 34.85 N.F. after giving tolerance of 2.5%. Challenging these orders the Writ petitioner sought a writ of Certiorari to quash these orders and to declare the consequential demand made by the Superintendent of Central Excise as unenforceable. 3. The learned single judge held that the opinion of the Chief Chemist that the counts ascertained in respect of the sample was that of 35.6 N.F., has been arrived at without applying any tolerance and if the tolerance limit is applied to this count, it would be below 34.85 and therefore the assessment made by the Excise authorities is incorrect, and ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the tolerance of 2.5% can be admitted in the declared count as well as in the counts determined by the Chemist and then see whether there is any case for levying duty. It must be remembered that the case of the writ petitioner respondent as well as the Government is that as the counts of yarn cannot be manufactured with exactitude the Government has fixed a tolerance limit of 2.5%. The same principle cannot be applied to an analysis made by an expert like the Chief Chemist, whose analysis is carried out on a scientific basis. That apart if the tolerance limit is to be applied to the declared count as well as the determined count then the manufacturer would be getting double advantage as he would be getting the benefit of tolerance limit u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applied also on 35.6 N.F. which count was determined by the Chief Chemist. Therefore it must be held that the yarn represented by the sample was of higher count. 5. It is then argued by Sri K. Sreenivasa Murthy, the learned Counsel for the respondent writ petitioner, that the test reports can be acted upon only in respect of the quantity of the yarn manufactured when the sample was taken and not for the entire period between 31st August, 1966 and 30th September, 1966, as by no stretch of imagination it can be said that the manufacturer manufactured the yarn of the same count throughout that period. In other words the contention of the learned Counsel for the respondent is that the assessment is arbitrary. To appreciate this contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the day when the sample was taken the officers cannot base the test results on the sample for the entire goods manufactured during the period till the next sample is taken". If we apply these observations, with which we are in agreement to the facts of the case before us, we find that the manufacturer has attended to the machinery and taken care to see that the yarn manufactured after 31st August 1966 was in conformity with the declared count. As mentioned above, the sample taken on 31st August 1966 was in order. It was only the sample taken on 31st August 1966 that was found to be in excess. The fact that the next sample taken on 30th September 1966 was in conformity with the count declared by the manufacturer speaks for itself that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the same is evident from his appeal memo and therefore he is liable to pay the duty at a higher rate. We are unable to agree with the learned Counsel after a careful perusal of the appellate order in which the contentions of the manufacturer are extracted. In that we find a reference to the statement of the manufacturer to the effect that the spinning master who was responsible for the variation was removed. From this it cannot be said that the yarn was manufactured at an excess count throughout the period. The removal of the then spinning master must be immediately after the sample was taken on 31st August 1966 and that counts for the yarn represented by the sample taken on 30th September 1966 being within the declared limit. That apart ..... X X X X Extracts X X X X X X X X Extracts X X X X
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