SOUTHERN STEEL LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THE Petitioner is a public limited Company having its registered office at Calcutta and its Factory at Maulali, Hyderabad. It manufactures and deals in iron and steel goods. Since the goods are excisable goods, the petitioner obtained a licence from the appropriate authorities of the Central Excise Departmant. The petitioner is paying excise duty under what is popularly known as 'self Assensment Scheme' under chapter VII-A of the Central Excise Rules (referred to in this Judgment as the Rules ). Under this Scheme, the assessee has to file with the proper officer for approval a list of goods in such form as the Collector may direct giving the full description of the goods, Item number and sub-item to the first schedule to the Act under which such goods fall, the duty leviable on such goods etc. , before removing the excisable goods. The appropriate officer approves the list with such modifications as are considered necessary. Accordingly the assessee was submitting the list of goods which is known as "classification List" According to the petitioner it manufactures Steel Hoops and Steel Strips [which are sub-items (ii) and (iii) of Tariff Item 26aa] from duty paid Hot Rolled Strips and Steel Skelp which fall under sub-item No. (iii ). The skelp which is used by the petitioner as raw material has already suffered excise duty which was paid by the Hindustan Steel Limited which is the manufacturer of skelp. Similarly, in the case of Hoops manufactured from H. R. Strips the duty was already paid by Tata Iron and Steel Company. According to the petitioner therefore, no duty is payable by the petitioner and as auxiliary duty is only a percentage of of the Excise duty, no auxiliary duty is payable. . On this footing the petitioner was submitting the classification list and removing the goods without paying excise duty. In the petition it is stated that this state of affairs was accepted by the Department without any comment from 1971 onwards. Further on one occasion when auxiliary duty was collected the petitioner applied for a refund of a sum of Rs. 9,000/-and the amount was refunded on 28-12-1973 by the Assistant Collector, Central Excise, I. D. O. , II after examining the issue and being satisfied that no excise duty or auxiliary duty was payable in respect of the goods being manufactured by the petitioner's factory.

(2.) IN the petition it is stated that on 31-1-1977 the Superintendent of Central Excise, (Preventive III), the third Respondent herein visited the Factory with his staff and purported to conduct a panchanama and desired to detain the plant and machinery. The Petitioner's Company Director and other officers protested against the proposed action and requested him to disclose the legal provisions under which he would take such action. As he did not respond petitioner served on him a letter D/-31-1-1977 protesting against the arbitrary procedure being adopted by the concerned Officer. In the Panchanama it is recited that the goods weighing about 127. 205 Metric Tons was seized and the plant and machinery worth about Rs. 40 lakhs was detained.

(3.) THE petitioner has filed Writ Petition No. 327 of 1977 praying for the issue of a Writ of Mandamus or any other appropriate Writ or directions directing the respondents, namely, the Union of India, the Collector, Central Excise and the Superintendent, Central Excise, to revoke the alleged oral seizure of goods and detention of plant and machinery purported to be effected on 31-1-1977 and permit the petitioner to clear its goods under the self-removal procedure under Chapter VII-A of Central Excise Rules in accordance with the classification list dated 25-6-1976 already approved by the authorities.