KIRLOSKAR BROTHERS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is a petition under Articles 226 and 227 of the Constitution of India for writs of Mandamus and Certiorari seeking to quash the demand, dated 20. 03. 1972 (petitioner's Annexure-G) directing the petitioner to pay the excise duty on the pre-budget stocks declarded on dated 16. 3. 1972 of power driven pumps and a writ of Mandamus restraining the respondents from recovering the excise duty from the petitioner as a condition precedent to the removal of the power driven pumps, which had seen manufactured from 01. 03. 1969 to 16. 03. 1972 during which period no excise duty was leviable.

(2.) THE facts leading to the filling or the present writ petition areis as follows: The petitioner, a limited company, has a branch at Dewas, where a factory has been installed for manufacturing power driven pumps. But notification dated 23. 04. 1969 (Respondents' Annexureis-I) in exercise of the powers conferred by Sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Government had exempted during the period commencing on 01-03-1969 and ending with 23. 04. 1969, the power driven pumps falling under item No. 30-A of the First Schedule to the Central Excises and Salt Act, 1944, from whole of duty of excise leviable thereon. It was also clarified that the benefit of the exemption of this notification would be available only to those manufacturers who produce proof to the satisfaction of the Collector of Central Excise that such benefit had been passed on by them to the person to whom they have sold the said power driven pumps. This benefit was continued by the Government upto 16. 03. 1972. During that period the petitioner was not even required to take a licence for the purposes of the Central Excise and Salt Act, 1944. However, by a notification dated 17. 03. 1972 (Respondent's Annexure-2), the earlier notification was modified and excise duty was made payable at 10% ad valorem on the price and any duty leviable under the Act in excess of 10% was continued to be exempted. Thus, with effect from this date only 10% ad valorem excise duty was payable by the petitioner. But from 01. 03. 1969 to 16. 03. 1972 no excise duty was payable by the petitioner by virtue of the specific orders passed by the Central Government. On 16. 03. 1972 the petitioner declared the stocks lying in the premises, which had been manufactured till 16. 03. 1972 as per the communication dated 17. 03. 1972 (Petitioner's Annexure-E ). The petitioner claimed that the said stocks had been manufactured during the period no excise duty was payable, and, therefore, the petitioner should be permitted to remove the said stock without payment of excise duty. That request of the petitioner was rejected by the Inspector Central Excise, vide letter dated 20. 03. 1972 (Petitioner's Annexure-G) and the petitioner was intimated that he could remove the pre-budget stocks of power driven pumps on payment of excise duty as per me notification dated 17. 03. 1972 only. Hence this writ petition by the manufacturer.

(3.) IT is, therefore, necessary to examine the nature and impost of excise duty on power driven pumps as per the Item No. 30-A of the First Schedule to the Central Excise and Salt Act, 1944. Section 3 of the said Act is the charging Section, which is as follows :