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TMI Blog2002 (9) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... ks 450 gms. 10,000 dozen Horlicks 800 gms 4,032.8 dozen 2. According to the petitioner, as the said pre-budget stock was manufactured prior to 1-3-1979, it was not liable to pay enhanced duty in terms of the Finance Act, 1979. 3. The petitioners claim that the duty payable by it would be governed by the law as was applicable as on 28-2-1979, taking the said plea the petitioners made representations dated 11-1-1980 and 20-2-1980. Petitioner company however made payment of the excise duty as demanded under protest. The aforesaid representations of the petitioners were rejected by respondent vide order dated 21-4-1980 stating : "The rate of duty applicable to any excisable goods shall be the rate and valuation in force on the date of actual removal of such goods from the factory. Your attention in this regard is invited to Rule 9A (l)(ii) of Central Excise Rules, 1944. In view of the above, your contention that the duty l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EGAT, New Delhi and vide order dated 9-12-1985 the Tribunal upholding the orders of the lower authorities dismissed the appeal of the petitioner company. 6. The petitioners in this writ petition, inter alia, submitted that having regard to the fact that excise duty is payable on the date of manufacture and not on the date of clearance, the cut off date for payment of duty was 28-2-79 and not 1-3-1979. 7. Mr Gulati, learned counsel appearing for the petitioners, would submit that having regard to the provisions contained in Section 3 of the said Act, read with Rule 9, the Tribunal must be held to have committed illegality in holding that the relevant date would be the date of clearance. In the instant case, it is not in dispute that the stock in question is pre-budget stock. The question as regards the applicability of the tariff, contended Mr Gulati, would depend on the date of manufacture and not the date of clearance. In support of the said contention the counsel relied on : Union of India v. State of Mysore - 1997 (1) E.L.T. 26 (S.C.) Viniyoga International v. States - 1985 (20) E.L.T. 23 Collector v. Modern Steel Ltd. - 1986 (26) E.L.T. 165 Ponds India L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or component parts shall be the rate and valuation in force on the date on which the duty is paid." 10. Section 37 provides for a rule making power. Sub-section (1) of Section 37 empowers the Central Govt. to carry out the effective purpose of the Act. Sub-section (1), (2)and (4) of Section 37 read thus: Power "37 Government to make rules - of Central (1) The Central Government may make rules carry into effect the purpose of this Act. (2) In particular, and without prejudice to the generality of the foregoing power such rules may— (i) xxx xxx xxx (ia) xxx xxx xxx (ib) provide for the assessment and collection of duties of excise, the authorities by whom functions under this Act are to be discharged, the issue of notices requiring payment, the manner in which the duties shall be payable and the recovery of duty not paid; (ibb) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect to levy of excise duty when they were manufactured and cleared. It was observed : "9. The two principal questions which arise for consideration before us in this appeal are : (i) whether the respondent was entitled to the benefit of the exemption notification dated November 23, 1961 when the dyes said to have been used by the respondent in the manufacture of other dyes were not liable for payment of excise duty when they were manufactured, that is, before the introduction of item 14D into the First Schedule to the Act even though duty may have been paid on them after the introduction of Item 14D and (ii) whether the demands made in this case fall within the scope of Rule 10A of the Rules or under Rule 10 thereof." "10. It is not disputed that the dyes in respect of which duty had been paid in this case has been manufactured at a time when no duty was leviable on them. This case actually began with the letter written by the respondent on December 22, 1961 within one month after the exemption notification dated November 23, 1961 was issued. In the said letter the respondent on doubt stated that the material which the local manufacturer has offered us was produced before the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise duty is payable, the special excise duty is also payable automatically. That is so as an, ordinary rule. But insofar as the goods manufactured or produced prior to March 1, 1978 are concerned the said rule cannot apply for the reason that there was no levy of special excise duty on such goods at the stage and at the time of their manufacture/production. The removal of goods is not the taxable event. Taxable event is the manufacture or production of goods."(emphasis supplied) 16. Yet again in Ponds India Ltd v. Collector of Central Excise Madras, 1997 (90) E.L.T. 3, the Apex Court referred to the case of Vazir Sultan Tobacco Co. Ltd. and observed : As we "7 of understand the judgment in the case Vazir Sultan Tobacco Co. Ltd, this is the view taken : The date of manufacture is the date upon which the levy attaches to the goods; the date of payment is deferred to the date of clearance, the rate being the rate which is effective on the date of clearance. Where goods have been manufactured while the levy of special excise duty is operative and have not been cleared until the last date of that levy, the goods must be deemed to have been removed on that last date." ..... X X X X Extracts X X X X X X X X Extracts X X X X
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