CCE Vs. NIRANJAN MILLS LTD.

JUDGEMENT

(1.) FACTS of this case as set out in the Revenue Appeal are as follows; M/s. Niranjan Mills Ltd., Surat are manufacturers of cotton yarn, Tariff Item No. 18E and cellulose spun yarn classifiable under T.I. 18 III of the erstwhile Central Excise Tariff. M/s. Niranjan Mills Ltd., Surat manufactured different types of yarn falling under the T.I. 18E and 18 III of erstwhile Central Excise Tariff and consumed them in the manufacture of cotton fabrics falling under T.I. 19 and Man Made fabrics of T.I. 22 of the erstwhile Central Excise Tariff without payment of Central Excise duty.

(2.) THE products manufactured at intermediate stage and captively consumed was liable to duty under Section 3 of the Central Excise and Tariff Act, 1985 even though it was captively consumed in a continuous integrated process. This was amply clarified by amendment to Rule 9 and Rule 49 of the Central Excise Rules, 1944 by Notification 20/82 dated 20.2.1982.

(3.) THE party filed a Civil Writ Petition No. 1063/81 in the Delhi High Court, which passed an order in favour of the Department. Being aggrieved by the Delhi High Court's judgment, the party approached the Supreme Court challenging the judgment and also requesting for stay of the operation of the judgment.