B.K. INDUSTRIES AND ORS versus UNION OF INDIA AND OTHERS

Citation: [1993] 3 S.C.R. 51 · Decided: 13-04-1993 · Supreme Court of India · Bench: B.P. JEEVAN REDDY · Disposal: Dismissed

Judgment (excerpt)

+:--
B.K. INDUSTRIES AND ORS. ETC. ETC. 
A 
v. 
( 
t 
UNION OF INDIA AND OTHERS 
APRIL 13, 1993 
[B.P. JEEVAN REDDY AND N. VENKATACHALA. JJ.J 
B 
.... 
Vegetable Oils Cess Act, 1983: Section 3. Leiy and collection of 
cess for period March. 1986 to March 31, 1987-Validity of 
Statutory Interpretation: 
c 
.L 
Power of exemption-Cannot be utilised nor extended to scrap-
..,. 
ping of the Act itself. 
_ _, 
Parliam_ent enacted in 1983 the National Oilseeds and Vegetable D 
Oils Development Board Act, 1983 to-provide for the development, 
under the control of the Union, of the Oilseeds Industry and the 
., 
Vegetable Oils Industry and for matters connected therewith. The 
Act contemplated the establishment of a board called the National 
Oilseeds and Vegetable Oils Development Board, and the Constitu-
tion of Oilseeds and Vegetable Oils Development Fund for promoting E 
the purposes of the Act. The Vegetable Oils Cess Act, 1983, was 
I. 
simultaneously enacted to levy and collect by way of cess, for the 
• 
purpose of the National Oilseeds and Vegetable Oils Development 
--
Board Act, 1983, a duty of excise on vegetable oils produced in any mill 
in India at such rate not exceeding Rs. S per quintal on vegetable oil. F 
This Cess Act was, however, repealed by Section 12 of the Cotton, 
Copra and Vegetable Oils Cess (Abolition) Act, 1987. Chapter S of the 
--
said Act carried the heading 'Collection and Payment of Arrears of 
Duties and Excise'. 
The petitioners who were manufacturers of vegetable oil, which G 
was subject to the cess/duty of excise under Section 3 of the Cess Act, 
in their writ petitions to this Court questioned the validity of the levy 
and collection of cess for the period commencing on, 1st March, 1986 
,. 
and ending with 31st March. 1987. It was contended that (1) In his 
---
Uudget Sp~ch delivered on 28.2.1986 while presenting the Budget H 
' 
"' 
SUPREME COURT REPORTS 
[1993) 3 S.C.R. 
A I1JX6-s1; the Union Finance Minister had stated that as an endea\'Our 
to. reduce the number of cesses it had been decided to dispense with 
the cess on cotton,copra and Yegetable oils and that this statement was 
exemplified and implemented b); way of a communicati1•n from the 
Directorate ofVanaspati. It is not open to the Go\'ernment to go hack 
upon the said decision and demand cess for the period subsequent to 
B March 1, 1986, and (2) By virtue of Sub-section (4) of Section 3 of the 
Cess Act, Rule 8 of the Central Excise Rules is attracted among other 
pro\'isions of the Central Excise Act and Rules. Reading the budget · 
proposals of the Finance Minister and the letter of the Directorate of 
Vanaspati together it must be held that vegetable oils ha\'e been 
c exempted from the le\')' under Section 3 (1). 
Dismissing the Writ Petitions, this Court, 
HELD: l (a) The cess having been imposed by a Parliamentary 
D enactment could he ren~ered inoperath·e only by a parliamentary 
enactment. Such repealing enactnient came only in the n~ar 1987 with 
effect from April 1, 1987. (58-C) 
E 
(b) The repealing Act expressl)' provided in Section 13 that the 
cess due before the date of said repeal, but not collected, shall be 
collected according to law as if the Cess Act is not repealed. This 
pro,·ision amounts to a posith·e affirmation of the intention of the 
parliament to k~ep the said imposition alive and effective till the date 
of the repeal of the Cess Act. (58-D) 
F 
(c) In the face of the aforesaid statutory provisions, no rights can 
G 
H 
be founded-nor can the le\')" of the cess be said to have been dispensed 
with b)' virtue of the alleged decision referred to in the Finance 
Min.ister's speech or on account of the letter dated August 11, 1986. 
(58-E) 
(d) The Finance Minist.er's speech is not law. The Parliament 
may or may not accept his proposal. Indeed, in this case, it did not 
accept the sa.id proposal immediately but only a ~·ear later. It is only 
from the date of t.fle repeal that the said leY)· hecomes inoperative. 
(58·F) 
"', 
• ---
-' ·' 
.... 
B.K. INDUSTRIES v. UNION OF IND.IA 
53 
, : 2(a)Thecessimpose~underSection3(1)oftheCessAct.isaduty A 
of Excise as stated in Section 3 itself. Therefore, the Central Board of 
Excise and Customs was perhaps competent to grant exemption even 
in the case of said cess though no definite opinion on this question need 
be expressed since it was not debated. Suffic~ it to say that the Central 
Government cannot again be brought in under sub-rule (2) of r

Excerpt shown. Read the full judgment & AI analysis in Lexace.