- (1.) The point involved in this appeal is short though the amounts are heavy. Perhaps that is the reason which persuaded the Union of India to file the present appeal which, as we shall presently see, is devoid of merits.
(2.) It appears that the demand of excise duty was raised against the respondent who were manufacturing nylon yarn. The demand raised was in respect of intermediate product. The said demand was challenged by the respondent filling a writ petition in the Bombay High Court on 28th of May, 1980. The case of the respondent was that the nylon yarn. which was manufactured by it was consumed within the factory for the manufacture of "nylon tyre cord wrap sheet" and the nylon yarn was not an excisable commodity.
(3.) On 9th of July, 1980, a Single Judge of the Bombay High Court while admitting the writ petition, granted the prayer of interim injunction on the condition that the respondent should execute a bond for payment of the amount claimed by the excise authorities with interest at 18% per annum from the date of the amount becoming due and payable and the respondent should also furnish bank guarantee for payment of the said amount along with interest.;