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TMI Blog1983 (8) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... e refills which are made of glass are a fragile commodity and consequently about 5% of his manufactured goods broke in the process. Another equally reasonable officer of Central Excise feels that not a single vacuum flask should be accounted for under the head of `breakages'. This thus is the focal point of the controversy. 2. J.K. Vacuum Flasks Limited are engaged in the manufacture of vacuum flasks and refills at Chinchvad, Poona 19, and hold Central Excise L-4 Licence. Under Section 3 of the Central Excises and Salt Act, 1944, duties of excise are levied on all excisable goods at the rates set forth in the First Schedule. Item 55 of the First Schedule speaks of vacuum flasks and other vacuum vessels. Under Chapter VII-A of the Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll as a revision application which followed, met with no success and the manufacturers, after serving a notice under Section 80 of the Civil Procedure Code, filed a declaratory suit in the Court of the Civil Judge, Senior Division, Poona, challenging the demand. The suit also met with the same fate and the manufacturers are now before this Court in appeal. 4. The key expression occurring in Rule 223A and repeated elsewhere in various administrative rules is : "As the proper officer may consider reasonable". Under Rule 223A, the proper officer has to make : "such allowance of waste by evaporation, or other natural causes as the proper officer may consider reasonable........" This phraseology runs through the entire gamut of the cat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n is whether the excise authorities exercised their discretion reasonably in the manner intended by Parliament or whether there was a malversation of any kind by which the decision was not according to law, but humour. 7. The first order dated 17th December 1973 of the Assistant Collector, Central Excise, Poona II Division, shows that the Assistant Collector did not accept the plea put forth by the party that 82,814 refills were due to the breakages, on the ground that the Appellant could not account for the remaining quantity of 82,814 refills "without any evidence on the record". 8. Before the Appellate Authority a statistical data was produced showing that the percentage of breakage in processing, testing, bad silvering and storing v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ary action the manufacturers might be keeping some notes of breakages, but failure to produce the same would not vitiate their case. As observed earlier, the standard refrain of the departmental orders is that the appellants should have produced account of breakages but the Respondent department could not pin-point any statutory rule as such which obligated the manufacturers to maintain a record of day-to-day breakages. 10. When Rule 223A cast a duty on the appropriate officer to take into account receipts and deliveries and make allowance for waste by evaporation, or other natural causes, it would be irrational for the officer to say because the manufacturers have not kept account of day-to-day breakages in their bonded store-room, he wo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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