BRITANNIA INDUSTRIES LTD Vs. UNION BANK OF INDIA

JUDGEMENT

(1.) THE Petitioner Company carries on business as manufacturers of biscuits. It has a factory at reay Road, Mazagaon, Bombay. The biscuits manufactured at the said factory were excisable goods and they were liable to ad valorem excise duty at the relevant time under the Tariff Item 1c of the First Schedule to the Central Excises and Salt Act, 1944.

(2.) ON 27th October 1980 the Petitioners moved the present Writ Petition, inter alia, challenging the varies of Section 4 of the Central Excises and Salt Act, 1944, which was substituted for the original Section 4 by Act 22 of 1973. They had also prayed for issue of appropriate writs against the Respondents for withdrawing and/or canceling the orders refusing their prayer for refund of the excess excise duty paid from 1-10-1975, for approving the price lists submitted by the petitioner Company on 6th August 1980 and to all the Petitioner Company to clear its goods after payment of the excise duty on the basis of the assessable values as declared in the price lists submitted by the Petitioner Company. The Petitioners also prayed for refund of the sum of Rs. 68,29,214. 81 p. which, according to the Petitioner Company, had been illegally collected by the respondents from 1st October 1975 to 31st March 1980 by including in the value of the petitioner's products post-manufacturing costs, expenses and profits. A learned Single Judge of this Court was pleased to issue Rule in terms of prayers (a) to (c) and on the Petitioners through their Advocates undertaking to this Court that in the event of this Petition being dismissed they will pay to the Respondents the differential excise duty in respect of goods cleared by them thereafter on the basis adopted by the Respondents and the amount actually paid within four weeks from the dismissal of the Petition with interest on the differential amount of 17 per cent per annum from the due date and on the Petitioners executing a bond without security in favour of the Respondents to the aforesaid effect, granted interim order in terms of prayer (d) of the petition.

(3.) IN their original Writ Petition the Petitioners had purported to rely mainly upon the decision of the Supreme Court in the case of A. K. Roy v. Voltas Ltd. , A. I. R. 1973 S. C. 225 and the other reported decisions which followed the same and had contended that in order to arrive at the assessable value of the Petitioner Company's products, deduction ought to be made of post-manufacturing expenses like sales and distribution establishment expenses, interest on deposits from distributors, product advertisements and sales promotion expenses, freight and insurance chargers, general administrative expenses for sales and also post-manufacturing profits etc.