TMI Blog1987 (12) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... course of repair of transformer. In July, 1982 the Government of India in case of Electric Equipment Factory which also carried on repair of transformers decided that in common parlance repair was clearly distinguishable from manufacture, therefore, the repaired transformer did not attract duty under tariff item No. 68. On 28th September, 1983 the petitioner relying on this decision applied for refund of duty paid on repair of transformers from April, 1983 to September, 1983. The application was allowed by the Assistant Collector on 30th October, 1984 as the transformers were received from various electricity divisions of U.P. State Electricity Board under repairing contract and their repair did not amount to manufacture as held by Governm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1986 the Assistant Collector issued a notice to show cause as to why the refund application of petitioner for the period 3rd October, 1979 to 5th April, 1983 may not be rejected as it failed, 'to prove that the new components and the fresh raw material used and replaced in the process of repairs (if excisable) has discharged the respective burden of duty'. The notice further required to show cause as to why should the claim be not rejected as barred by time. In reply it was stated, 'that in course of repair of damaged transformers, transformer oil or leg coils etc. are replaced and the invoice value represents the cost of these material plus painting and labour charges. All the materials and components used are purchased except the leg coil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis. The finding that magnetic steel core was used appears to be assumptive. On what material the Assistant Collector recorded this finding has not been disclosed. Even the averments in sub-paragraph (s), (t) and (u) of paragraph of the amendment application averring that petitioner never manufactured or replaced magnetic core as it is not subject to replacement nor did any of its customers which is the Electricity Board, only, ever required it replace it has been specifically denied in the counter-affidavit. What is astonishing is that the allegation that Electricity Board never asked the petitioner to replace magnetic core has been replied by saying that it is technical in nature. Refund is claimed of duty paid on parts used in repair. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, is narrowed down to if the petitioner was liable to pay duty on parts manufactured in its factory and replaced in course of repair. Even though it is claimed that electric coils the only part which was replaced were prepared by conforming to dimension, weight and design, therefore, it did not amount to manufacture it need not be examined as the government had in exercise of power conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 exempted goods falling under item No. 68 of the First Schedule if it was manufactured in a factory and intended for use in the factory in which it was manufactured by Notification No. 118/75-C.E. dated 30.4.1975. It is reproduced below : "Exemption to goods used in the factory of production ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise even though it was exempt. 4. What still survives for consideration is if the finding of Assistant Collector that the claim was barred by time suffers from any error of law. But more important than this is the question if the remedy of petitioner was barred under the statute was it entitled to approach this Court. And if it was then whether it came within reasonable time. In paragraph 24 of the petition it is admitted that petitioner came to know of the mistake of law in April, 1983 when it received communication from its Association about the decision of Government of India in Electrical Equipment's case. Since then it was claiming exemption and paying duty under protest. It was in November, 1984 only that its claim was accepted an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cawasji v. Union of India decided on 9th December. It has been held that the knowledge of payment under mistake of law gives rise to two remedies, one in the Statute which can be enforced within six months and the other under the general law which can be availed of within three years from the date of knowledge and it is this period which has been held to be reasonable period within which the payer of duty is entitled to invoke extraordinary jurisdiction of this Court under Article 226 [In State of M.P. v. Bhailal Bhai, (A.I.R. 1964 S.C. 1006], it was held : "It appears to us, however, that the maximum period fixed by the legislature as the time within which the relief by a suit in a Civil Court must be brought may ordinarily be taken to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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