9911796707
TMI Blog1987 (12) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... g of these two writ petitions are that the petitioner-company is carrying on the business of manufacturing various types of papers and having its factory at Saharanpur (U.P.). The excise duty on the paper for the first time was levied in the year 1955 and a resident Inspector of Central Excise was posted at the factory of the petitioner with effect from March 1, 1955 and who was incharge of levying and collecting the excise duty of the paper being produced by the petitioner in the aforesaid factory. This duty was being levied at that time under Item No. 17 of the First Schedule to the Finance Act, 1955. Upto the year 1964 the production capacity of the petitioner's factory stood at about 22,000 M.T. per year. In 1965 the petitioner took up the expansion programme for increasing the capacity to about 35,000 MT per year by installing new machines and also by effecting renovation of existing machinery. After obtaining requisite import licence for importing the machinery and also procuring new machinery locally, the expansion of the capacity of the -factory was completed in May, 1968. 4. On October 1, 1965, the Government of India issued Notification No. 163/65-Central Excise, giving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that the petitioner was thus entitled to refund of duty in respect of only 719.965 M.T. of paper under the first notification. Annexure P/5 is the copy of the order. The contention raised by the petitioner is that the concession availed in respect of first 1000 M.T. of paper vide Notification No. 208/67 read with Notification No. 21/68 was obtained even before the excess production was made in that particular year. Hence, the Assistant Collector was wrong in excluding 1000 M.T. of paper from the excess production to which the petitioner was entitled concessional duty in view of the first, notification inasmuch as no concession had been obtained under the first notification in respect of the first 1000 M.T. of paper. 6. The petitioner's appeal highlighting these points was, however, dismissed by the Appellate Collector on May 17, 1973. The Collector gave the opinion that the total production included 1000 M.T. of initial production and thus the petitioner could claim concession under the first notification after excluding the production of 1000 M.T. of paper. He directed that the concessional duty if already availed by the petitioner in the year 1970 in respect of 1000 M.T. of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Collector repelled the objections of the petitioner and confirmed the demands vide his order dated March 2, 1977 with the finding that Rule 10A was applicable wherein no limitation has been provided and also that the petitioner had enjoyed double benefit of concession in duty in respect of 1000 M.T. of paper cleared in each financial year mentioned above. The petitioner's appeals against the order were dismissed on August 20, 1977 and the revisions were also dismissed on February 27, 1979. The petitioner had filed the second writ petition against the said orders. 8. The petitioner has reiterated his pleas which he had taken before the respondents claiming that in fact the petitioner had not enjoyed double concessional duties on first, 1000 M.T. of paper cleared in every financial year. According to the petitioner, the petitioner had enjoyed the concessional duty in respect of the said paper in view of the notifications (Annexures P/2 P/3) and the petitioner was entitled to concessional duty in respect of notification (Annexure P/1) on the enlarged production and the enlarged production did not include the first 1000 M.T. of paper cleared in each financial year. Hence, the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the whole year June, 1969 to May, 1970 the excess production was only to the tune of 1719.965 M.T. of paper. So, it is clear as far as the production of the said year was concerned that 1000 M.T. of paper cleared in April, 1970 was not part of the quantity of excess production. In the counter these facts have been admitted in respect of production for the year June, 1969 to May, 1970. 10. Now coming to the second notification (Annexure P/2), exemption from duty to the extent of 75% was made available for the first 1000 M.T. of paper cleared by the manufacturer for home consumption during any financial year. However, clause 2 of the notification laid down that this exemption should not be admissible to a manufacturer who has availed himself of any of the concessional rates of duties admissible under columns 4, 5(a), 5(b) 5(c) of the table below the Notification No. 163/65. If the notification has remained as it is, obviously the petitioner could not have taken advantage of this notification because the petitioner could get the benefit of either of these two notifications and not of both. However, the third clarificatory notification (Annexure P/3) was issued giving the concess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cess production achieved during that period. In accordance with the second and third notifications read together if 1000 M.T. of paper had been cleared for claiming the benefit of concessional duty during' the financial year which admittedly commences in April and that was part of the excess production then the petitioner would not be entitled to benefit of both the notifications simultaneously because that was provided in the notification itself that if benefit in respect of the same paper had been enjoyed in the first notification of 1965 then on the same paper additional benefit cannot be granted in consonance with the second and third notifications. However, the petitioner has clearly pleaded that after clearing 1000 M.T. of paper in April 1970 for which benefit was taken in the second and third notifications the petitioner managed to achieve the excess production of 1719.9 M.T. only in the month of May 1970 meaning thereby the benefit of first notification was not enjoyed by the petitioner in respect of 1000 M.T. of paper first cleared in April 1970. Hence, the petitioner was entitled to benefit of these notifications simultaneously because it pertained to different paper prod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the benefit of concessional duty simultaneously in respect of these notifications and only exception is that if the benefit has been enjoyed in respect of particular production of paper then second benefit cannot be made available on the same quantity of paper. That is the only reasonable interpretation possible in respect of the said notifications. I have gone through the impugned orders made at different levels by the respondents and I find that they had not given any reasons as to why the said notifications should not be interpreted in the manner sought to be interpreted by the petitioner keeping in view the facts brought on the record by the petitioner in respect of the production levels achieved by the petitioner at different points of time. After all even if the petitioner had installed more machines to have a capacity for larger production than the production level achieved in the base year prior to enhancement of the capacity to produce more and factually the petitioner is not able to produce the paper more than what has been produced in the base year, the petitioner would not be entitled to concessional duty as envisaged in the first notification. It is quite clear from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other sum of any kind payable to the Central Government under the Act or these Rules, the proper officer may serve a notice on the person from whom such duty, deficiency in duty or sum is recoverable requiring him to show cause to the Assistant Collector of Central Excise why he should not pay the amount specified in the notice. (2) ..........................." 16. If the demand notices are covered by Rule 10, then obviously they are beyond limitation because they have been issued after expiry of more than six months from the relevant date. If they are covered by Rule 10A then they admittedly are within time because no period of limitation has been prescribed in Rule 10A. It is obviously a case of short levying of duties due to some erroneous interpretation of the notifications by the officers concerned of the respondents. The petitioner has been admittedly filling up necessary forms which used to be checked by the officers of the respondents and it is not the case that the petitioner had concealed any material facts before claiming the benefit of concessional duty under the aforesaid notifications. On facts I have already come to the conclusion that the petitioner was enti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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