NEW GUJARAT SYNTHETICE LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS petition had been preferred challenging orders dated 22. 09. 1981, 22. 09. 1981 and 14. 10. 1981 respectively raising demands to the tune of Rs. 52,808. 43, Rs. 25,406. 82 and Rs. 835. 38, respectively being Annexure-F, Annexure-G and Annexure-H.

(2.) THE petitioner, a Limited Company, is manufacturing cotton fabrics and for the said purpose also manufacturing yarn in the same mill premises. It is the say of the petitioner that the petitioner had opted for compounded levy and accordingly duty on cotton yarn manufactured by the petitioner was being paid by the petitioner at the time of clearance of the cotton fabrics manufactured by the petitioner out of cotton yarn.

(3.) AS against that, according to the respondent authority, the petitioner was permitted under Rule 96w of the Central Excise Rules, 1944 to pay duty on yarn manufactured at the time of payment of duty on cotton fabrics. But despite the petitioner having recovered the duty on yarn in addition to the contract price / wholesale price declared in the price list of cotton fabrics there was short payment of excise duty on the fabrics so cleared for the period 16. 03. 1976 to 31. 12. 1976, 01. 01. 1977 to 30. 04. 1977 and 01. 05. 1977 to 07. 05. 1977. After issuing show cause notices to the petitioner and considering the replies tendered by the petitioner, the three orders were made by the respondent authority raising the demands in question.