MIHIR TEXTILES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) We had heard these petitions at length and we had indicated to the learned Advocates that we would dispose of these petitions as finally heard. At that time Mrs. Mehta and Mr. J. D. Ajmera had stated that they would waive service of rule on behalf of the respondents and the Court may dispose of the petitions finally. Accordingly we issue rule. Mrs. Mehta and Mr. Ajmera waive service of rule in each petition and we now proceed to dispose of the petitions on merits.

(2.) In this batch of petitions the petitioner Companies are engaged in the manufacture and production of cotton and man-made fabric covered under Chapters 52 54 and 55 of the Central Excise Tariff Act 1985 (hereinafter called the Tariff Act). These manufacturing concerns have taken out L-IV licenses under the Central Excises and Salt Act 1944 (hereinafter called the 1944 Act) read with the Central Excise Rules 1944 (hereinafter called the Rules) framed thereunder. According to the petitioners eventhough man-made fabric is an excisable commodity under the Tariff Act on duty of excise is leviable thereon under Sec. 3 of the 1944 Act but an additional duty of excise is levied on specified goods under sub-sec. (3) of Sec 3 of the Additional Duties of Excise (Goods of Special Importance) Act 1957 (hereinafter called the 1957 Act) i.e. inter alia on goods falling under Chapter 54 and 55 of the Tariff Act. Section 3 of the 1957 Act reads as under:

(3.) On 25/11/1987 the Central Government issued another Notification No. 254 of 1987 (Annexure A) superseding the earlier Notification No. 60 of 1987 whereby the basis for grant of exemption underwent a change in respect of the goods covered under the aforestated headings. The petitioner contend that the net effect of this change is an increase in the additional duty of excise on the specified goods. The question then is whether goods manufactured before the Notification No. 254 of 1987 dated 26/11/1987 came into effect but not removed from the factory premises would be governed by the said Notification or the earlier Notification No. 60 of 1987 which was in operation till then. According to the petitioners the goods manufactured prior to 25/11/1987 and laying in stock of the Company would be entitled to the benefit of the exemption Notification No. 60 of 1987 and would be liable to pay additional duty on the basis thereof. The revenue contends otherwise.