AJANTA ELECTRICALS Vs. COLLECTOR CENTRAL EXCISE

JUDGEMENT

(1.) WHETHER lamp holders are electric lighting fittings described in Entry 61 of the 1st Schedule to the Central Excises and Salt Act, 1944 and are liable to excise duty is the short but significant question which falls for determination in this writ petition under Article 226 of the Constitution of India.

(2.) FIRST the factual matrix : M/s. Ajanta Electricals of Phagwara are manufacturing lamp holders, since the year 1958 along with other electrical goods. They supply these goods to various departments of the Government and also sell the same in the open market.

(3.) IN 1977, Entry No. 61 was added to the 1st Schedule of the Central Excises and Salt Act, 1944 (hereinafter called 'the Act') by the Finance (2) Act. 1977 (29 of 1977 ). It reads as under :item Description Rate of No. of goods duty 61. Electric Lighting Fittings namely :- Switches, Plugs Ten per and Sockets, all kinds : cent ad Chokes and Starters for Fluorescent Tubes. valorem. Under Serial 3 of the Act, excise duty is levied and collected in the manner prescribed and the rates set forth in the 1st Schedule. The result of the addition of Entry No. 61 was that the petitioner was required to pay 10% excise duty on the items mentioned in this entry. Though the language of the entry did not warrant it, yet the departmental authorities interpreted it to mean that lamp holders were covered by this entry. On the insistence of the officers of the excise department, the petitioner-firm after enjoying the benefit of exemption started paying excise duty on lamp holders, although the petitioner continued representing that the lamp holders manufactured by it Were not covered under Entry No. 61. The petitioner came to know that the department was being guided by a Trade Notice No. 100/ce/77 dated the 22nd December, 1977, which reads as under : "sub :- Scope of Tariff Item No. 61-C. E. T. The attention of the trade is invited to Tariff Item No. 61 of Central Excise Tariff. 2. A point has been raised whether the lamp holders (including two-way, three way etc. adapters) and switch-socket combinations ould be classifiable under Tariff Item No. 61. 3. The matter has been examined and it is clarified that since Item No. 61 covers all kinds of switches, sockets and plugs, the above mentioned articles, which are essentially in the nature of switches, sockets and plugs are covered by Tariff Item No. 61, if they are designed to function as electric lighting fittings. " The representatives of the Trade had approached the Government nd submitted that the lamp holders were not covered by Entry No. 61. However, this plea was not accepted and the above-mentioned Trade Notice was issued.