KISHAN LAL DALMIA Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) In this application the petitioner has challenged the demand of duty made, certificate proceedings initiated and the distress warrant issued against the petitioner by the Central Excise Authorities Consequent upon the assessments made under the Central Excises & Salt Act, 1944.

(2.) The facts are in a narrow compass: The petitioner purchased cold rolled strips from the market in the usual course of business and re-rolled and re-processed the same in his own factory at Salkia into cold rolled strips of different length and gauges through rolling machine and sold the same to his customers. According to the petitioner the said cold rolled strips purchased by the petitioner from the market were duty paid. It is the case of the petitioner that the re-rolling or reprocessing of the said cold rolled strips is not manufacture but only processing. The petitioner duly submitted monthly returns of production in Form No. R.T. 12 in accordance with Rule 173G of the Central Excise Rules, 1944. The Superintendent, Central Excise, Assessment Group Assessment Group No. II Calcutta-V Division in his assessment orders held that the petitioner could not prove that the said goods purchased from the market and utilised in the processing were duty paid in terms of the Government of India's Notification No. 75 of 1967 dated 20th May 1967. The Superintendent levied the differential duty and raised demand on the petitioner. The Petitioner's factory was allegedly closed for labour trouble since 16th February 1974 to July 1975 and the petitioner did not have any access to his own factory and office records nor the petitioner was allowed to enter into the factory by the employees. The petitioner by a letter dated 15th February 1974 brought the said fact to the attention of the Central Excise Authority as well as Labour Directorate. The petitioner had to declare closure of his business. Because of the said closure, it is alleged, that the petitioner could not make necessary representation against the said demands raised or the certificate issued under the Public Demands Recovery Act for enforcement of the demand amounting to Rs. 40,376.38 p. The respondents also purported to issue distress warrant for realisation of the said demand, which according to the petitioner, he is not liable to pay at all. As indicated earlier all those proceedings are the subject matter of challenge in this application.

(3.) At the hearing Mr. N.L. Banerjee, learned Advocate for the petitioner has contended that the Assessing Officer proceeded on the assumption that the petitioner produced or manufactured the goods and was accordingly liable for duty on the rerolled and re-processed articles under Section 3 of the Central Excises & Salt Act. The job done by the petitioner is not manufacture in terms of Section 2(f) of the said Act. According to the petitioner those who manufactured cold rolled strips removed the said goods upon payment of Central Excise Duty under Rules 7, 9 and 173(a) of the Central Excise Rules. Therefore the manufacturers of the cold rolled strips paid the duty on the said goods. Otherwise the said goods could not come to the market for being sold to the buyers like the petitioner. Because the petitioner re-rolled the cold rolled strips with the help of rolling machine, it cannot come within the purview of the 'manufacturer'. He has relied on certain notification and/or circular in support of his contention.