S S MIRANDA LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The present controversy arises out of the decisions under the Central Excise Act by the Supreme Court on the subject of the post manufacturing expenses in Union of India & Ors. v. Bombay Tyres International Private Limited reported in 1983 (12) E.L.T. at page 869 and 1983 (14) E.L.T. at page 1986 and also in 1984 (17) E.L.T. at page 329 and the order passed by this Court in the present petition on the 9th December 1983. In order to appreciate the precise nature of the controversy, it is necessary to state the following few preliminary facts :The Petitioners are a public limited company engaged in the business of manufacturing of engineering goods such as tool bits, rounds, turnings, hacksaw blades, etc. After this Court gave its decision on the question of post manufacturing expenses in the case of Bombay Tyres International Private Limited which was reported in 1979 E.L.T. at page 625, the Petitioners submitted a revised price list to the Excise Authorities on the 16th January 1980 on the basis of the said judgment. On the 4th February 1980 they wrote a letter to the Excise Authorities that henceforth they would pay the excise duty on the post manufacturing items under protest. On the 26th March 1980 the Petitioners submitted a fresh price list on the basis of audited accounts for the year ending 31st December 1979 and also made on the same day a refund application for Rs. 15,01,043/- for the period from July 1977 to December 1979. On the 5th May 1980, the Assistant Collector of Excise passed his order rejecting the revised price list, and on the 25th July 1980 he also rejected the claim of refund. The Petitioners preferred an appeal against both the orders, and on the 10th September 1980 the Collector of Excise (Appeals) rejected the appeal on merits. It is to challenge the said Appellate Order that the present petition was filed on the 8th October 1980.

(2.) In the meanwhile the Supreme Court delivered the aforesaid orders and judgments in appeal against the decision of this Court in the case of the Bombay Tyres International Private Limited. In view of the said orders and decisions of the Supreme Court, the learned Single Judge on the 9th December 1983 passed an interim order in this petition. The sum and substance of the said order was that the assessing authorities, namely, the Assistant Collector, Excise was to permit the Petitioners to submit their statements of deductions/amendments in respect of the price list already filed for a proper determination of excise duty-liability in respect of deductions claimed under some headings beyond those dealt with in the decision of the Supreme Court, if they were otherwise admissible. The Assistant Collector was also to permit the Petitioners to submit their refund claims or amendments to their refund claims already pending in respect of the said heads of deductions. The Petitioners were also required to file such documentary evidence which they might be called upon to do by the Assistant Collector. The Assistant Collector was then to finalise the price lists/refund claims after giving an opportunity to the Petitioners, and pass a speaking order. The Assistant Collector was thereafter to file in this court the orders of assessment along with the copies of statements of deductions/amendments and the price lists, etc. All final orders including orders for payment were then to be passed by this Court. After the said order was passed notices were sent by the Assistant Collector calling upon the Petitioners to produce the relevant documentary evidence in support of their claim under each of the heads under which deductions were claimed by the Petitioners and after hearing the Petitioners, the Assistant Collector passed his order on the 18th May 1984, allowing certain deductions and rejecting others.

(3.) Although originally the Petitioners were claiming various reliefs in different amounts, the Petitioners have now confined their only to two items. The first item is of deduction for the "Surprise Incentive" offered by them to their customers for the year 1983 and the second item is of the claim for refund in respect of the headings under which the deductions were allowed by the Assistant Collector and covering the period (a) from 1st July 1977 to 27th September 1979 and (b) from 1st January 1980 to 29th January 1980. It may be mentioned here with regard to the claim for refund for the two periods that although the Assistant Collector held that the relevant deductions were permissible, he rejected the same on the ground that the claim was not filed within six months which is the period of limitation for claiming refund under Section 11B of the Central Excise Act.