DECCAN SALES CORPORATION Vs. R PARTHASARTHY

JUDGEMENT

(1.) In this miscellaneous petition a short but interesting question regarding the application of Rule 56-A of the Central Excise Rules, 1944, arises. The said Rule has undergone slight changes and hence we will have to consider the rule as it stood when the petitioners applied for a refundof the amount of Rs. 77,587/- which they did in 1970. In order, however, to understand the nature of the petitioners' claim and in order to consider whether the same is required to be upheld or repelled, I may sate a few facts.

(2.) Petitioner No. 1 is a company inter alia carrying on business as manufacturers and dealers in fertilizer mixtures. Petitioner No. 2 is its shareholder and Managing Director. I shall refer to Petitioner No. 1 hereinafter as "the Company" for the sake of brevity.

(3.) The Company manufactures granulated compound fertilizers and for the purposes of manufacture uses as raw material certain base fertilizers. These base fertilizers are manufactured by other persons and certain excise duty is levied on the base fertilizers. The product manufactured by the Company was, during the period 1st March, 1969 to 28th February, 1980, subject to levy of excise duty. However, as in the process of manufacture the company had used as raw material excise duty paid goods viz. the base fertilizers, the Company sought credit under Rule 56-A of the Central Excise Rules, 1944. At this juncture the relevant portion of the rule as it then stood may be set out :