1975 (1) TMI 32 - HC - Central Excise

Cut or broken steel ingots purchased from Mini Steel Plants - Alternative remedy - Existence of

Summary

Issues:
1. Interpretation of exemption notification for excise duty on steel products made from ingots.
2. Whether the petitioners are liable to pay excise duty on steel products manufactured from ingots received from Mini Steel Plants.
3. Availability of alternative remedy through appeal to departmental authorities.

Analysis:
1. The judgment dealt with Writ Petitions challenging an order by the Superintendent of Central Excise directing the petitioners to pay excise duty on steel products made from ingots. The petitioners argued that their products were exempt under a notification for products made from ingots on which excise duty had already been paid. The Court analyzed the notification and held that the exemption applied to products made from ingots, regardless of the source, and that recovery of excise duty was unlawful.

2. The petitioners contended that the steel products manufactured from ingots received from Mini Steel Plants, on which excise duty had already been paid, were exempt from further duty. The Excise Department argued that the exemption only applied to ingots from large steel plants or when cut by suppliers. The Court rejected these arguments, stating that the notification did not differentiate between ingots from different sources and that the exemption applied irrespective of the source of supply.

3. The respondents argued that the petitioners had an alternative remedy through appeal to departmental authorities and that the writ petitions should be dismissed on that ground. The Court disagreed, stating that direct challenge to tax or duty imposition is permissible under Article 226 if clearly illegal. Since the issue involved interpretation of the notification and not factual disputes, the Court found the writ petitions maintainable and allowed them, quashing the Superintendent's order and directing no excise duty on the products covered by the notification.