9911796707
TMI Blog1985 (4) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... kespeare Sarani, Calcutta-17. The company is engaged in the business of manufacturing and dealing in articles of footwear and accessories. For the purposes of the said business, the company has three manufacturing establishments namely, a factory at Batanagar in the district of 24-Parganas, West Bengal, another factory at Bataganj near Patna in the State of Bihar and a third manufacturing establishment at Faridabad in the State of Haryana. By virtue of Entry 36 of the First Schedule in the Central Excises and Salt Act, 1944 (hereinafter called the `Act'), footwear and parts thereof in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power, is chargeable to excise duty, the rate of duty being te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accordance with the provisions of Section 4 of the Act, as they stood at the relevant time was only Rs. 4.94 and hence less than Rs. 5 per pair, such items qualified for exemption from duty under the Notification dated July 24, 1967. Though originally the Department appears to have been inclined to accept the correctness of the stand taken by the company, later on they changed their stand and informed the company that the articles of footwear manufactured by it, of which the wholesale price was Rs. 6.25 per pair were chargeable to excise duty since while computing the "value" of the articles for the purpose of judging the applicability of the exemption, the duty element of the cost structure could not be deducted from the wholesale price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Haryana High Court dismissed the company's Writ Petition in limini on the ground that the company had approached the High Court at a very belated stage. The Division Bench, however, certified the case to be fit one to this Court under Article 133 of the Constitution of India. Similar certificates were granted to the company and to the Union of India respectively by the High Courts of Calcutta and Patna. That is how these appeals have come to be filed in this Court. 7. After hearing Counsel appearing on both sides and giving our anxious consideration to the matter in all its aspects, we are clearly of the opinion that the view taken by the High Court of Patna is the correct one and the contrary view taken by the High Court of Calcutta canno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery at the place of manufacture or production, or if a wholesale market does not exist for such article at such place, at the nearest place where such market exists. (b) (Not relevant) Explanation - In determining the price of any article under this section no abatement or deduction shall be allowed except in respect of trade discount and amount of duty payable at the time of removal of the article chargeable with duty from the factory or other premises aforesaid." Under this Section, in all cases where any article is chargeable with duty at a rate `dependent upon its value' such `value' is to be computed by deducting from the wholesale cash price referred to in clause (a) two components of the price structure namely (1) trade discount a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applicable to all cases where any article is chargeable with duty at a rate dependent upon the value of the article. In the case of a total exemption, the rate will be `nil'. Thus, Entry 36 read along with the Notification dated July 24, 1967 clearly shows that the chargeability to duty in respect of any article of footwear is made dependent upon its value in the sense that the chargeability to duty of excise will arise only if the `value' of the article does not exceed Rs. 5 per pair. It is, therefore, plain that before determining the question of availability of the exemption under the Notification dated July 24, 1967, the first essential step is to determine the `value' of the article in the manner prescribed in Section 4 of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordance with the provisions of Section 4 of the Act did not exceed Rs. 5 per pair, the articles in question were exempt from the charge to duty of excise under the Notification dated July 24, 1967. 11. In the result, C.A. No. 1470 of 1972 arising out of the judgment of the High Court of Calcutta, C.A. No. 353 of 1971 filed against the order of the High Court of Punjab and Haryana and the Writ Petitions filed by the company in the High Courts will stand allowed with the direction that the amounts of duty illegally realised by the Department from the company should be forthwith refunded to it. C.A. No. 1469 of 1972 filed by the Collector of Central Excise, Patna against the decision of the Patna High Court will stand dismissed. In C.A. N ..... X X X X Extracts X X X X X X X X Extracts X X X X
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