BHADRACHALAM PAPER BOARDS LIMITED Vs. UNION OF INDIA
LAWS(APH)-1992-10-4
HIGH COURT OF ANDHRA PRADESH
Decided on October 21,1992

BHADRACHALAM PAPER BOARDS LIMITED, 31 SAROJINI DEV ROAD, SECUNDERABAD, 500 003-REPRESENTED BY ITS GENERAL MANAGER (LEGAL) AND COMPANY SECRETARY AND CONSTITUTED ATTORNEY S.MATHEWS Appellant
VERSUS
UNION OF INDIA REPRESENTED BY ITS SECRETARY, IN THE MINISTRY Respondents


Cited Judgements :-

E UDDANDA RAMAIAH VS. V R S and Y R N COLLEGE [LAWS(APH)-1995-6-20] [REFERRED TO]
ORIENTAL SELECT GRANITES P LTD VS. DIRECTOR OF MINES and GEOLOGY [LAWS(APH)-1995-12-115] [REFERRED TO]
SUBASH NEEMKAR VS. REGIONAL JOINT COMMISSIONER OF ENDOWMENTS [LAWS(APH)-2006-1-6] [REFERRED TO]
HALLMARK TOBACCO COMPANY LIMITED VS. COMMERCIAL TAX OFFICER [LAWS(APH)-1995-11-159] [REFERRED TO]


JUDGEMENT

Syed Shah Mohammed Quadri - (1.)W.P.No. 5613 of 1985. 1. The petitioner challenges the validity of the order of the Assistant Collector, Central Excise, Warangal Division, Warangal, the 2nd respondent herein, in Proceedings No.C.No.V/17/30/11/84/MPI/Adjudication Order No. 4/85(M.P.) dated 29-5-1985 and the consequential order of the 3rd respondent in letter dt. 3-6-1985, by praying for a Writ of Mandamus declaring the said orders as illegal, null and void.
(2.)The first petitioner is a limited company incorporated under the Indian Companies Act. The 2nd petitioner is one of the share-holders. Under Rule 8(i) of the Central Excise Rules, the Central Government issued Notification No. 201/79 dated 4-6-1979. It was subsequently amended by Notification No. 105/82 dated 28-2-1982, granting certain exemptions. The petitioner filed declarations for the excisable goods i.e. paper and paper- boards of different varieties from time to time. Under the said notification, the 1st petitioner-company was availing proforma credits in respect of 12 items including burnt lime (hereinafter referred to as the "lime input"). The 3rd respondent issued show cause notice No. 4/82 dated 3-7-1982 calling upon the 1st petitioner-company to show cause as to why credits taken for the inputs mentioned therein should not be disallowed in terms of the notification. The 1st petitioner-company filed its explanation. After opportunity of oral hearing, the 3rd respondent ordered that the company was entitled to take proforma credits in respect of ten items out of twelve items, in adjudication No. 3/82 MP dated 31-12-2982. After about two years thereafter the 2nd respondent issued a show cause notice dt. 16-8-1984 stating that the proforma credits availed by the 1st petitioner-company appears to be incorrect. The 1st petitioner-company replied to the show cause notice stating inter-alia the notice is without jurisdiction. It was also stated that the inputs of the said twelve items, were used in the manufacture of paper and paper boards. By. order dt. 9-5-1985 the 2nd respondent set aside the order of the 3rd respondent dt. 31-12-1982 and ordered for withdrawal of the amount standing to the credit of the 1st petitioner-company under the heading "Wire, burnt lime and alfloc powder of all grades" and directed demand of all the credits availed during the period commencing from 1-7-1982. This order was purported to be passed under Section 11-A of the Central Excise and Salt Act. Consequent upon that order the 3rd respondent issued a demand on 3-6-1982 directing payment of Rs. 10,87,581-03. These orders are assailed in the Writ Petition.
(3.)The 2nd respondent filed a counter-affidavit stating inter-alia that under T.I.68 read with Notification No. 201/1979, the following materials were notified: (1) Alum, (2) Resin, (3) China Clay, (4) Sodium Sulphate, (5) Sodium Sulphide, (6) Sodium Aluminate,, (7) Talcum Powder, (8) Glue, (9) Alpholoc Powder, (10) Cepol Powder, (11) Wires, and (12) Burnt Lime. The Superintendent of Central Excise, who is in-harge of the 1 st petitioner-company by order dt. 31-12-1982, allowed set off after inspection of items mentioned at Serial Nos. l to 8,10 and 12 and disallowed set off in respect of Serial Nos. 9 and 11. In respect of these items no appeal was preferred. On 16-8-84 the 2nd respondent issued a show cause notice to the 1st petitioner-company to explain as to why the set off permitted by the Superintendent in his order dt. 31-12-1982 should not be withdrawn and the amount of Rs. 25,83,895-55 being the credit for the period between 1-7-82 to 15-8-84 should not be adjusted as laid down in the proviso 4 to the Notification No. 201/79. After considering the reply of the 1st petitioner-company, the 2nd respondent upheld the order of the 3rd respondent with regard to allowing of set off of items 1 to 8 and 10 but set aside set off in respect of burnt Lime, Wires and Alpholoc Powder and demanded duty in respect of those three items from 1- 7-82. It is stated that where proforma credits are availed the officers scrutinise the credits. It is further stated that the impugned order was not passed either under Section 11-A or under Sec. 35-E of the Act. On merits it is submitted that the burnt lime is issued in the soda recovery cycle to convert the Sodium Carbonate in the green liquor to Sodium Hydroxide. It is not a raw material used for the manufacture of the pulp. It is added that the petitioner had to file an appeal against the said impugned order and as alternative remedy of appeal is available, the Writ Petition is not maintainable.
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