HARINAGAR SUGAR MILLS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The decision of the tribunal, that is the Customs, Excise & Gold (Control) Appellate Tribunal dated 6.6.1988 is assailed by this writ petition.

(2.) THE issue as raised in the writ petition is in fact academic. The subject matter is molasses. The petitioner M/s. Harinagar Sugar Mills Limited admittedly manufactures sugar and molasses is a subsidiary product. On removal of molasses from the place of production centra excise duty admittedly was chargeable. As the place of storage and/or the store room had to be approved by the Collector, Central Excise, under the law, an exception had been made for the petitioner company to temporarily store and remove molasses in Kuchcha place. No sooner such condition had been granted, it had been withdrawn. By law the petitioner was under an obligation to store molasses removed from the place of production in an approved place of storage. The rest of the facts are available from the order of the Assistant Collector, dated 27.2.1984. As excise duty had not been paid on the molasses in question, a demand had been raised. The petitioner gave an explanation to the effect that they were unable to store the entire molasses in proper storage due to bumper production and high cost of building steel tanks. In so far as the later part is concerned, making arrangement for storage of molasses appropriately or in steel tanks is the obligation of law. The petitioners were put under notice and remained so under notice for seventeen months. The Assistant Collector was of the opinion that despite the fact that the petitioners had about seventeen months to make arrangement for storage of the molasses appropriately, they did not do so.

(3.) THE tribunal upheld the orders of the assessing authority and the Collector (Appeals) and declined to interfere in the matter or grant any relief to the petitioners to exempt them from payment of central excise duty on manufactured molasses. The tribunal was of the opinion that duty is clearly payable in terms of rule 9 read with rules 47 and 49 under the Central Excise and Salt Act, 1944.