STEEL AGE INDUSTRIES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The first petitioner is a limited company of which are second petitioner is the director. For the sake of convenience, they will hereinafter be referred to as "the petitioners". The petitioners are engaged in the business of manufacture of security equipments such a safes, strong boxes, safe deposit lockers, furnitures etc. All these are made of steel. For this purpose the petitioner purchase steel sheets and plates from the factories which are now owned by the Steel Authority of India Limited which, as is well known, now owns the steel projects in the public sector. On the products manufactured by them the petitioners have to pay excise duty. However, under a Notification No. 95/79-C.E., dated 1st of March, 1979, credit is available to the petitioners to the extent of the excise duty which has been paid on steel sheets and plates consumed by the petitioners in the manufactures of their own products.

(2.) Rule 56A of the Central Excise Rules, hereinafter referred to as "the Rules", prescribes the procedure in accordance with which credit for the excise duty which is already paid under the notification referred to above is to be followed. A manufacture permitted to avail of the benefit of the said notification is required to bring to the factory the material or the component parts or finished products in original packing under the cover of A.R.I. (gate passes) or such other document as may be approved by the Central Board of Excise and Customs or bill of entry evidencing the payment of excise duty. In the present case the petitioners have followed none of the three options available. They purchased the steel plates and sheets from the factories owned by the Steel Authority of India Limited, hereinafter referred to as "the SAIL".

(3.) The petitioners addressed a letter dated 30th of April, 1979 to the Excise Department pointing out that under the notification dated 1st March, 1979 their products have been exempted from the duty paid on the steel sheets and plates in the manufacture provided Rule 56A is followed. They requested the Assistant Collector of Central Excise, to whom the said letter was addressed, to allow them to follow the procedure to avail of the said credit. The Assistant Collector of Central Excise by his reply dated 2nd April, 1979 pointed out to the petitioners that the petitioners were to produce subsidiary gate passes indicating therein all the description like the gate pass number under which the goods were cleared from the factory, rate of duty etc. from the dealers from whom they were purchasing the steel sheets. Further correspondence ensued between the petitioners and the Excise Department, the latter insisting upon the production of the documents mentioned in Rule 56A(3)(i)(b). The petitioner have now approached this Court under Article 226 of the Constitution of India praying for an order requiring the respondents to give them credit without insisting upon the documents mentioned by the respondents in their correspondence with the petitioners.