TMI Blog1980 (11) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... and Finance (department) No. 184/76-CE, dated 27th May, 1976, has been "invalidated" by a judgment of 27th August, 1980. The firm complains that as a result the bond paper is dumped in the State of Andhra Pradesh and because no duty is paid on paper manufactured in Tamilnadu the goods are sold at lower prices. The firm is apprehensive of loss of business due to lower cost price and it is represented they are likely to be elbowed out from the market. The firm lodged the writ petition in such exigencies and seeks the relevant notification to be quashed. Thus the question raised at issue is : Whether it is legal to levy duty on bond paper under the Act ? To be precise in formulating the question whether the bond paper is an item which falls un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the firm. As to how a bond paper is manufactured the process is described in the following words by the Revenue : "By bonding a layer of kraft paper to another layer of kraft paper, that one roll of the kraft paper is passed on to another one on the roller of a machine and while the roll of kraft paper is being passed on, Bitumen which is kept in a tank and heated by electrical application is applied as bonding material to the paper in the roll at the lower surface, that after the paper to which the Bitumen is applied reaches the second roller another roll of kraft paper is passed on and both the rolls of kraft paper which are bonded by Bitumen come out of the machine as Bituminised water proof paper." On the above process the questions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 35(a) and 36 of the Act. Those remedies are not exhausted by the firm therefore should not be permitted to have recourse to the proceedings under Article 226 of the Constitution of India. This plea is considered in the context of difficulties and competition experienced in marketing the goods as not efficacious. The writ petition, therefore, is held maintainable. 7. The principal contention of the firm as narrated earlier it is not dutiable for bond paper is not manufactured. This result is sought to be achieved in more than one argument on behalf of the firm. 8. The firm contends the two components of bond paper, kraft paper and Bitumen (asphalt) are "raw materials" that go to produce the bond paper. Kraft paper under item-17, Bitumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of the Schedule under Section 3 of the Act the finished goods if they "hop back" and fall on the same item of the Schedule (Item-17 in the instant case) such finished goods cannot be further subjected to duty under the same item of the Act. This in truth is a facet of the plea of double taxation which Krishna Iyer, J. hoped that after his opinion in (3) the "contention" will "rest in peace". The learned Judge said in the decision that an "epitaph" was being written in that case. Alas the argument resurfaces in the Courts. It succeeded in Madras High Court. The "contention" is ever living and "dies hard." The theory that components of finished goods have suffered duty. Such manufactured goods should "hop" into another item before they are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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