- (1.) The petitioner objects, through this petition, to the disallowance of benefit of utilisation of money credit available under Notification No. 46/89, dated 11.10.1989 as amended by Notification No. 26/91, dated 25.7.1991, issued under Rule 57-K of the Central Excise Rules, 1944 (hereinafter referred to as the Rules), in respect of vegetable oils used as input by the petitioners in manufacture of soap noodles. A copy of the order dated 31.10.1991 passed by the Assistant Collector, Central Excise, Kanpur, disallowing the utilisation of money credit has been filed as Annexure-9 to the writ petition.
(2.) The petitioners' factory is situate in district Unnao which manufactures soap noodles. Soap noodles is a final product of the petitioners' factory. To establish the above facts the petitioners filed the classification list duly approved by the Assistant Collector, Central Excise, Kanpur. It is Annexure 1 to the writ petition, showing the full description of the item produced or manufactured as "soap noodles" excisable under sub-heading 3401.10 of the Central Excise Tariff. Annexure-2 is the Price List duly approved by the competent authority of the Excise Department, also showing the same as Annexure-1. The sub-head 3401.10 of the Central Excise Tariff shows the excisable item as "soap in any form". Petitioners' case is that it manufactures soap in "noodle" form. According to the petitioners, it is also not disputed by the opposite parties that specified vegetable oils are used as input in the manufacture of the final product, namely, the "soap noodles". Therefore, the petitioners are entitled for the benefit of utilisation of money credit on account of use of specified vegetable oil as input, as admissible under the notifications mentioned above, issued under Rule 57-K of the Rules. For the sake of convenience, Rule 57-K is reproduced below: 57-K. Applicability and extent of credit.--(1) The Central Government may, by Notification in the Official Gazette, specify-- (a) the finished excisable goods (hereinafter referred to as "final products") and the raw materials used in the manufacture of such final products (hereinafter referred to as "inputs"), to which alone the provisions of this section shall apply; and (b) the rates at which the credit of money is to be given for use of such inputs in the manufacture of final products. (2) When a Notification has been so issued under Sub-rule (1), credit at rates specified therein may be allowed for use of such inputs in the manufacture of such final products and the credits so allowed may be utilised for payment of duty on the final products, subject to the provisions in this section and the conditions, if any, stipulated in the said Notification.
(3.) A copy of the amended Notification dated 25.7.1991 issued under Section 57-K of the Central Excise Rules, 1944 has been filed as Annexure-3 to the writ petition. Clause (i) of the said Notification provides as follows: NOTIFICATION NO. 47/89 (N.T.) C.E. (SIC) DATED 11.10.1989, AS AMENDED BY NOTIFICATION NO. 26/91 (N.T.) C.E., DATED 25.7.1991. In exercise of the powers conferred by Rule 57-K of the Central Excise Rules, 1944, the Central Government hereby specifies-- (i) the inputs, namely, vegetable oils (whether or not subjected to any one or more of the process of hydrogenation or hydrolysis) of the description in column (2) of the Table hereto annexed and used in the manufacture of the final product, namely, soap, falling under sub-heading No. 3401.10 : of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); and (ii) ...;