LIMENAPH CHEMICALS Vs. UNION OF INDIA

JUDGEMENT

(1.) THE petitioner has filed this writ petition challenging the correctness and validity of the order dated 31-1-1989 passed by the second respondent in the petition. THE petitioner is engaged in the manufacture of a product marketed in the brand name "Janatha Cem". According to the petitioner, it is a kind of cement obtained by heating limestone and charcoal in a kiln. As per the affidavit of the petitioner, the product was being cleared as Sagol under Tariff Item No. 23 of the First Schedule of the Central Excises and Salt Act, 1944 as it stood till it was replaced by the Central Excise Tariff Act, 1985. THE petitioner has also availed of exemption from excise duty under Notification No. 5/1970 dated 31-1-1970. THE Notification exempted

(2.) ON 22-11-1984 a show cause notice was issued to the petitioner on the basis that the product would fall under Tariff Item No. 68 and he was called upon to show cause why duty should not be levied from November 1979 to October 1984. The provisions of Section 11A of the Central Excises and Salt Act was also invoked in that notice. In paragraph 15 of the notice it was stated that the petitioner deliberately misdeclared the goods as "wall painting cement" and misrepresented to the department that it was sagol exempted under Notification No. 5/70 dated 31-1-1970. A reply was sent by the petitioner in December 1984. A second show cause notice was issued on 20-4-1985 for the period 1-1-1984 to 31-3-1985. It was stated in paragraph 15 thereof that the petitioner had misdeclared the goods and made misrepresentations to the department as to the classification of the product. Again the petitioner sent a reply denying the statements contained in the show cause notice.

(3.) THE aggrieved petitioner preferred appeals to the Collector. THE latter passed an order on 31-3-1986 setting aside the orders of the Assistant Collector and remanding the matter for fresh consideration. THE Collector held that the question could be decided only after the result of the test samples drawn already was communicated to the party and the market name of the item, as distinct from the name used by the manufacturers should also be considered. Hence, the Collector directedde novoenquiry into the matter and has directed the authorities to make enquiries in the market and collect trade enquiry reports.