V.P.Tyagi, Ag.C.J. - (1.) S. Zoraster and Company (Supplies) Pvt. Ltd. has filed this writ petition under Article 226 of the Constitution praying that the Union of India may be restrained by issuing a writ of prohibition from levying and collecting excise duty on their product, namely, woollen industrial felt under the Central Excises and Salt Act, 1944 (hereinafter referred to as 'the Act'). It was further prayed that the amount of Rs. 7,52,320.55 paise collected by the respondent as excise duty from the petitioner company be ordered to be refunded to the petitioner.
(2.) The petitioner-company manufactures woollen felts at Jaipur. The woollen felts and allied product manufactured by the company, according to the petitioner, are used for industrial purposes, and not for wearing apparels and therefore it does not fall within the expression 'woollen fabrics' as used in Item No. 21 of Schedule I annexed to the Act under which the excise duty is charged.
(3.) According to the averments made by the petitioner-company there is similar factory known as Gujarat Woollen Felt Mills, Baroda producing exactly the similar material. That Mill challenged in the Gujarat High Court the levy and collection of excise duty on their produce and the Gujarat High Court by their judgment in Special Civil Appln. No. 442 of 1967 under Article 226 of the Constitution in the matter of Gujarat Woollen Felt Mills v. Union of India held that the woollen felt manufactured by that firm could not be taxed under Item No. 21 of Schedule I to the Act. On the basis of this judgment of the Gujarat High Court the petitioner-company wrote to the excise authorities not to levy and collect the excise duty on the woollen felt produced by it but in spite of its repeated requests made by the petitioner the excise authorities did not agree and continued to levy and collect the excise duty on the product of the petitioner-company. It is under these circumstances that the petitioner has filed this writ petition with the prayer as aforementioned.;