KLIN O PACK Vs. UNION OF INDIA

JUDGEMENT

(1.) IN this writ petition, the petitioners are challenging the validity of the order passed by the Assistant Collector of Central Excise, Division VII, Bombay-1, dated 15th January, 1988, so far as it denies right to opt out of MODVAT scheme during the financial year and confirmed demand against the petitioners in the sum of Rs. 77,977. 96 and Rs. 67,041. 64. The facts in nutshell are as under:

(2.) THE petitioners are a small scale industry duly registered with the Director of Industries, Bombay. The petitioners inter alia manufacture aluminium collapsible tubes classifiable under chapter sub-heading No. 8512. 11 of Central Excise Tarrif Act, 1985. Under the Finance Act, 1986, the provisions of Rule 57-A to Rule 57-J were introduced by way of amendment to the said Rules (popularly described as MODVAT Rules ). Under the MODVAT scheme while making payment of excise duty on finished goods, the duty on the raw materials used by the manufactures are adjusted or in other words, if any duty is paid on the materials used in the manufacturing process, in that event, while making payment of excise duty, on the end-product, the duty which is already paid in respect of those materials are deducted.

(3.) THE petitioners opted for MODVAT scheme to claim benefits available to the petitioners as a small scale industry unit. The petitioners filed declaration in this regard on 11-4-1986 in accordance with rules in the prescribed manner indicating the description of final product manufactured in the factory and inputs intended to be used in the final product on and from 11-4-1986.