LexASSOCIATED CEMENT CO. LTD. versus DIRECTOR OF INSPECTION, CUSTOMS & CENTRAL EXCISE, NEW DELHI.
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ASSOCIATED.CEMENT CO. LTD. v. DIRECTOR OF INSPECTION, CUSTOMS & CENTRAL EXCISE, NEW DELHI. March 29, 1985 [V.D. TULZAPUR.KAR, V. BALAKRISHNA ERADI AND R.B.MISSRA, JJ.] 575 Income Tax Act 1961, Section 280ZD Tax Credit Certificate (Excise I>uty on ExceJs Clearance) Scheme 1985 & Finance Act 1965, Section 80 Manufacturer of cement-Whether entilled to Tax Credit Certificate in respect of special Excise duty levied under Finance Act 1965, Words & Phrases : 'Duty of excise'-Meaning of-Section 280ZD (6) (b) Income Tax Act 1961. The Tax· Credit Certificate (Excise Duty on Excess Clearance) Scheme 1965 was fra~ed by the Central Government und.er s. 280ZD of the Income Tax Act 1961. It was made applicable to the Cement Industry in 1965. For the year 1965-66, the excise duty for Cement levied under the Central Excise and Sa It Act 1944 was Rs. 23.60 per ton, but under s. 80 of the Finance Act 1965 a special duty of excise equal to 25% of the total amount of e11:cise char- geable under the Excise Act on various articles including cement was levied. The appellant company on the excess Clearance of cement made during the concerned year 1965-66 over and above the quantity cleared in the base year (financial year 1964-65) applied for the grant of tax credit certificate to the concerned authority. The authority however, granted the Tax Credit Certificate only in respect of the Central Excise Duty levied under the Ex- cise Act, taking the view that the appellant was not entitled to have any tax credit in respect of any other excise duty levied under a djfferent enactment, qarpelr 1 s, 80 of the Finance Act 1 B c D E F A B c 576 SUPREME COURT ~EPORTS f.1985) 3 S.CR. The appellant company challenged in the High Court. The aforesaid view, but it was rejected on. the ground that tax credit would not be available to ~he appellant-company in respect of the special excise duty levied under. ~. 80 of the I inance Act, 1965 having regard to the special meaning assigned. to the expression 'duty of excise' by clause (b) of sub-section (6) of section 280ZD Dismissing the appeals and Special leave Petitions to this Court. HELD : 1., Under s. 280ZD (!) a manufacturer of the concerned goods is entitled to be granted a tax credit certificate for an amount calculated at the rate not exceeding 25% of "the amount of duty of excise payable by him" on that quantum of the goods cleared by him during the relevant finan- cial year "'hich excer.ds the quantum of goods cleared by him during.the base year and clause (b) of sub-section (6) of section 280ZD defines the expression 'duty of excise' for the purpose in a special manner, as "the duty of excise leviable under the Central Excise and Salt Act 1944". [578C·E] 2. Sub clause (3) & (4) of s. 80 of the Finance Act, 1965 refer to the procedural aspect such as the quantification and collection of duty. Simply because the quantification and c0Jlec1ion of special duty under the Finance Act D · is to be done in the manner indicated under the Excise Act, such duty does E F G not become Ieviable that is chargeable under the Excise Act. [578G-HJ Se,f/iasayee Paper & Boards Ltd. v. Deputy Director of Inspection, Customs and Central Excise, New Delhi, and Anr,. 114 ITR 616, over~ruled. CIVIL APPELLATE JURISDICflO~: Civil· Appeal Nos. 1201-03 of 1972 From the Judgment and Od·" dt. 30.4.1971 of the High Court of Delhi in Civil Writ No. 1217/67, 425/68 & !6/70. WITH Special Leave Petitions (Civil) Nos. '.'.820-23 of 1977. arom theJ udgment and order dt. 18.1.1977 of the High Court of· Delhi in Letters Patent Appeals Nos. 3 to 6 of 197.7. Anil Devan, A.N. Haksar and D.N. Misra for the Appellant ~ in C.A. Nos. 1201-03/72. ' B.P. Maheshwari for the Petitioner; in SLPs Nos. 2820-23 l of 1977. Abdul Khader, T.V.N. Chari and R.N. Poddar for the Respondents in C.A. Nos. 1201-03/72. The Order of the Court was delivered by TULZAPURKAR, J. Two contentions under a Scheme called ff "Tax Credit Certificate (Excise Duty on Excess Clearance) Scheme, ASSOCIATED CEMENT co. v. CENTRAL EXCISE (Tulzapurkar, J.) 577 1965" framed by the Central Government under s. 280 ZD of the Income Tax Act, 1961, which were negatived by the High Court, have again been pressed by the appellant company before us in these appeals but after hearing counsel for the appellant company at some length and after going through the relevant provision of the said Scheme, rel
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