DYNAMO DILECTRICS Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is a petition by one partnership firm and its partners, who are stated to be citizens of India, challenging the two decisions of the respondent No. 3, being Annexures H and I respectively of February 1983, decided after issuance of the two notifications, Annexures E and F of 19 -6 -1981 and 20 -6 -1981 calling upon the petitioners why the classification of the goods manufactured by them and accepted or approved as falling under Entry 22F of the First Schedule appended to the Central Excise and Salt Act, 1944 be not changed. This would have obviously the civil consequence on the petitioners' rights and that is why they had filed this petition for the following prayers to be found at page 30 :

(2.) THE matter was admitted by another Division Bench of this court and certain interim reliefs were granted.

(3.) IN order to understand the grave controversy that was raged before us in this matter, a few basic facts are required to be closely noted. The petitioner -firm has been manufacturing and dealing in glass fabrics (epoxy B stage), varnished fibre glass sleeves and unvarnished fibre glass sleeves and also scrap of the last two items. They have, for that purpose, their factory situated at Baroda, within the jurisdiction of the respondent No. 3, the assistant Collector of Central Excise. The firm had commenced its business of manufacturing those articles in the year 1968 -69. As per the then existing entries in the Schedule appended to the Central Excise and Salt Act, hereinafter referred to as 'the Act' for brevity's sake, the petitioners were not required to pay any excise duty and an unsuccessful attempt was made by the respondent No. 3's predecessor to impose excise duty on those manufactured articles by alleging that some of the goods manufactured by them fell under the then existing Entry 22. The matter, however, was carried to the Central Board of Excises and Customs by these very petitioners, because the Collector interpreted the Tariff Item 22 to the detriment of these petitioners. The Collector held that for the period from 1 -1 -1969 to 15 -3 -1976 the goods manufactured by the petitioners fell under the then existing Entry No. 22 because on the day following that day (i.e., 15 -3 -1976) day itself the exemption was granted on such articles. The main reason that prompted the Asst. Collector to try to attract entry 22 to the goods was that those fabrics made out of glass fibre were fabrics impregnated or coated with preparations of cellulose derivatives or of other artificial plastic materials. Negativing the said contention of the Collector, the Board held in substance that any or every impregnated or coated fabrics would not be included in the item No. 22 which was captioned as Rayon or Artificial Silk Fabrics.