UNION OF INDIA, NEW DELHI Vs. JYOTI LIMITED, BARODA

JUDGEMENT

(1.) THIS appeal arises out of the judgment and decree passed by the learned Civil Judge, Senior Division, Baroda, dated 16th February, 1968, in Special Suit No. 25 of 1967, filed by respondent against the appellant -Union of India.

(2.) THE suit was for a declaration that the action of the defendant (appellant) in refusing to allow the plaintiff - respondent to clear the electric motors. Without payment of excise duty on the amount of trade discount is illegal, ultra vires, malafide and outside their powers and jurisdiction, and for a declaration that the action of the appellant -defendant in levying and charging excise duty on the amount of trade discount is illegal, unauthorised and in contravention of the provisions of the Central Excise and Salt Act, 1944 (which will be hereinafter referred to as 'the Act') and for a permanent injunction restraining the Union of India and its officers and servants from collecting excise duty from the plaintiff -respondent on the amount of trade discount allowed by the plaintiff to its dealers and distributors. Plaintiff also prayed for the recovery of a sum of Rs. 89,246.70 paise, wrongly collected from the plaintiff along with interest at 9 per cent per annum and the costs of the suit. * * * The learned trial Judge has passed the following decree : 'The plaintiff do recover from the defendant Rs. 82,571.10 paise with the full costs of the suit and running interest at 6 per cent. on the principal amount of Rs. 75,742/ - from the date of suit till realisation. Further, it is hereby declared that action of the Excise authorities and officers of the Union of India in refusing to allow the plaintiff to clear the electric motors without payment of duty on the amount of trade discount is illegal, ultra vires, mala fide and outside their powers and jurisdiction. It is further declared that the action of the Excise authorities and officers of the Union of India in levying and charging Excise duty on the amount of trade discount is illegal, unauthorised and in contravention of the provisions of the Central Excise and Salt Act, 1944. The defendant, its officers, servants, agents are hereby restrained from collecting Excise duty from the plaintiff on the amount of trade discount allowed by the plaintiff to its dealers and distributors. The defendant should bear its own costs and pay the costs of the plaintiff.' The Union of India being dissatisfied with the decree, has preferred the present appeal to this Court.

(3.) THE plaintiff - company is doing manufacture of pumps of various sizes, electric motors, switch -gears and other electric equipments.