Andhra HC (Pre-Telangana)
Auric Engineering Private Limited vs Assistant Collector Of Central Excise ... on 1 January, 1800
Equivalent citations: 1980(6)ELT620(AP)
ORDER
1. The petitioner in these two writ petitions is a manufacturer of Electrical stampings and Laminations. In respect of these goods, the Government of India issued a Notification granting limited exemption from payment of excise duty. The Notification is in the following terms :
"In exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts electrical stampings and laminations falling under Item No. 28A of the First Schedule to the central Excise and Salt Act, 1944 (1 of 1944) upto a quantity not exceeding twenty metric tonnes, cleared for home consumption on or after the 1st day of April in any financial year by or on behalf of a manufacturer from one or more factories, from the whole of the duty of excise leviable thereon :
Provided that -
(i) this exemption shall not apply to any such electrical stampings and laminations manufactured by a manufacturer if the total quantity of such electrical stampings and laminations so cleared by such manufacturer during such financial year exceeds forty metric tonne;
(ii) where a factory producing such electrical stampings and laminations is run at different times in any financial year by different manufacturers, the quantity of such electrical stampings and laminations so cleared from such factory in any such financial year at nil rate of duty shall not exceed twenty metric tonne;
(iii) in the case of such electrical stampings and laminations manufactured by a manufacturer the quantity of which so cleared during such financial year exceeds twenty metric tonne but does not exceed forty metric tonne this exemption shall apply to the first clearances thereof upto a quantity not exceeding twenty metric tonne; provided further that a manufacturer shall be permitted to clear for home consumption during the period commencing on the 1st May, 1974, and ending on the 31st March, 1975, electrical stampings and laminations upto a quantity not exceeding eighteen meteoric tonne subject to the condition that the quantity of electrical stampings and laminations cleared for home consumption by or on behalf of such manufacturer from one or more factories during that period does not exceed thirty six metric tonne. (P.) F. (D.R & I.) NOTFN. No. 86/74-Central Ex. dated 1.5.1974)".
As the petitioner-company's production during the Financial Year ending on 31-3-1975 was less than 36 Metric Tonnes, it claimed refund of excise duty paid by it on the first 18 Metric Tonnes. Similarly, for the Financial Year ending on 31-3-1976, its production was below 40 Metric Tonnes and therefore it claimed refund of excise duty paid by it on 20 Metric TOnnes. The application in respect of the financial year ending on 31-3-1975 was filed on 3-4-1975 and the application in respect of financial year ending on 31-3-19756 was filed even before the financial year. Both the applications for refund were rejected by the Central Excise Department on the ground that they were time- barred.
2. According to the Department, the applications for refund should have been filed within three months from the date of payment of excise duty on the first 18 Metric Tonnes for the year ending 31.3.1975 and the date of payment of excise duty on the first 20 Metric Tonnes. The view of the Department was that the assessee was not bound to pay duty on the first 20 Metric Tonnes. If, at the end of the Financial Year, it was found that the total production exceed 40 Metric Tonnes, it would be for the Central Excise Officials to demand payment of duty on the first 20 Metric Tonnes also.
3. The contention of the petitioner's learned counsel was that the view of the Department was untenable. On a fair reading of the Notification, I am inclined to agree with the submission of the learned counsel for the petitioner. Whether the production during a financial year would exceed 40 Metric Tonnes or not would be known only at the end of the Financial Year. It is only at the end of the Financial Year that the petitioner company could properly claim refund on the basis of the Notification. In the present case, the Central Excise Officials did collect duty from the petitioner-company even on the first 20 Metric Tonnes contrary to the view which they are now putting forward. In am also unable to see any moral justification for the attitude of the Department. The petitioner-company is clearly entitled to the exemption under the Notification. No purpose seems to be served by unnecessarily denying the benefit to which the petitioner's company is entitled.
4. Both the Writ Petitions are allowed. In each case, a director will issue to the respondents to grant the refund claimed. There will be no order as to costs.