- (1.)The Petitioners are manufacturers of electronic products known as "Stereo amplifiers" and the petitioners also assemble the products known as "Speaker systems".
(2.)Prior to March 1, 1975 excise duty was not levied upon the Petitioners' said products. During the first week of March 1975, the Superintendent and Assistant Collector of Central Excise insisted upon the petitioners' products being charged to excise duty under Item 37A of the First Schedule to the Central Excises and Salt Act as parts or accessories to gramophone. The petitioners were threatened that unless the excise duty on the said products is paid action would be taken under the provisions of the Central Excises and Salt Act and the Central Excise Rules. The petitioners thereupon filed Miscellaneous Petition No. 323 of 1975 in this Court challenging the action of the Assistant Collector of Central Excise. The Petition was summarily dismissed by the learned single judge by an order dated March 31, 1975 and against the impugned order, the petitioners carried Appeal No. 77 of 1975 before the Division Bench of this Court. The appeal was admitted on May 2, 1975 and on a Notice of Motion the petitioners were directed to deposit the amount of excise duty in this Court and the Government was restrained from taking any steps against the petitioners on the ground that the products of the petitioners were excisable. In pursuance of this order, the petitioners deposited an amount of Rs. 8,79,171.80 in this Court.
(3.)From June 17, 1977 by amendment of the Tariff Act, the stereo amplifiers and speakers systems which are manufactured by the petitioners were included in a newly inserted Item 33F in the First Schedule of the Central Excise Act and it is not in dispute that thereafter the petitioners are liable to pay excise duty in respect of the manufacture of the products. The appeal preferred by the petitioners before the Division Bench was disposed of by an order dated March 17, 1978 and the Assistant Collector was directed to give hearing to the petitioners on the issue of excisability of the petitioners' products for the period from March 1, 1975 to June 17, 1977 and to pass appropriate orders thereafter. The Division Bench also directed that the amount deposited by the petitioners in this Court should be invested in the fixed deposits until further orders.