MUNICIPAL COUNCIL DAMOH versus VRAJ LAL MANILAL & CO. & OTHERS

Citation: [1982] 3 S.C.R. 307 · Decided: 23-02-1982 · Supreme Court of India · Bench: V.D. TULZAPURKAR · Disposal: Dismissed

Judgment (excerpt)

r 
301 
MUNICIPAL COUNCIL DAMOH 
v. 
VRAJ LAL MANILAL & CO. & OTHERS. 
February 23, 1982 
[V.D. TULZAPURKAR AND AMARENDRA NATH SEN, JJ.] 
Central Provinces & Berar Municipalities Act, 1922-Ru/es made under the 
Act-Rute·27(b) of the Octroi Ru/1s-Octroi duty paid on raw material imported 
into the municipality for manufacture of bidis;_Manufactured bidis exported out~ 
side ihe municipal limits-Refund, 11 allowable uncf.er rule 27(b). 
Words & phrases: "manufacture" and "manufacturing process''-Meaning 
of. 
The res"pondents manufacture and selJ bidis in the state. At the time of 
import of tobacco and other raw materials into the municipal Jimits for the 
manufacture of bidis they paid oc:troi duty payable under the rules. Their claim 
for refund of octroi duty on the raw materials utilised for the bidis which they 
manufactured and exported outside the municipa1 limits was rejected by the muni· 
cipal counCil. 
Rejecting the appellant-council's contention that the benefit of rule 27(b) of 
the Rules was not available to the respondents fo! the reason that the exported 
goods (bidis) were not the same or identical as the imported raw materi8l'J the 
Sub-Divisional Officer allowed the respondent's appeal. 
Io revision the High Court upheld the order of the Sub-Divisional 
Officer. 
In appeal to this Court it was contended tlrat refund is available under 
rule 27(b) only where even after undergoing the manufacturing process the impor· 
ted article retained its essential character as s~ch ar!icle and the same was expor-
ted outside the municipal limits. (2) The respondents we~ not entitled to refund 
as they failed to satisfy the committee that the san1e or identical goods had been 
exported. 
Dismissing the appeal, 
HELD : I (a) Rule 27(b) of the Octroi Rules in terms provides for refund 
of octroi paid on imported. ·raw materials when such raw material is actualJy 
used within the municipal limits for manufacturing the exported articles. Clause 
(b) of this rule itself speaks of the raw materials being "used in the manufacture" 
A 
B 
c 
D 
E 
F 
G 
H 
A 
SUPREME CC)URt REPOR'rS 
[19821 ~ s.c.a. 
so that use. or consumption which a manufacturing process entails was present 
to the mind of the framers of the rule when they provided for the refund on the 
export of finished goods manufactured within municipal limits. [313 F-H) 
(b) The well settled connotation of ''manufacture" and "manufacturing 
process" is that as a result of undergoing the process, a distinct commercial 
commodity .different from the raw materials, comes into existence. Therefore 
B 
the expression 'manufacture' occurrine in rule 27(b) cannot be given a limited 
meaning as suggested by the appellant. [313 H, 314 A-BJ 
c 
2. The proviso to the rule is not attracted to a case of manufactured goods 
f.alling under clause (b). The proviso is applicable to cases where there is an 
export of the importc~ goods themselves without subjecting them to any manu· 
factoring process. It is in such cases that in order to claim refund the exporter 
has to satisfy the committee that the Same goods on which import duty had been 
paid were bein_g exported. The proviso is not a proviso to clause (b) at all but 
will be applicable to the other parts Of the rule. [314 C, D, El 
3. It is not just to permit the appellant to raise the plea of limitation in 
the case becallse at one stage it acquiesced in the trial court's finding and did not 
raise the question in appeal before the High Court. While asking for a certifi-
D 
cate for appeal the appellant did not raise the question of limitation before the 
High Co)lrt nor did it include the point of Jimitatioo in the memo of appeal 
filed in this Court. The point raised needs investigation into facts. [316 .F-G] 
E 
F 
G 
H 
CIVIL APPELLATB JURISDICTION : Civil Appeals Nos. !048 of 
1970 & 845 of 1971. 
Appeals by certificate from the judgment and decree dated 
the 11th March & 15th November 1969 of the Madhya Pradesh High 
Court (Jabalpur) in Misc Petition No. 96 of 1959 and in First 
Appeal No. 44 of 1966 respectively. 
AND 
Civil Appeals Nos. !047, 1048 & 1049 of 197!. 
Appeals by special leave from the judgment and decree dated 
the 17th April, 197 l of the Madhya Pradesh High Court at iabalpur 
in Second Appeal Nos. 415, 416 & 417 of 1966 respectively. 
D.V. Patel, S.S. Kh,induja and C.L. Sahu for the Appellants in 
all the Appeals. 
Dr.Y. S. Chitale)nd Rameshwar Nath for Respondent No. J 
in Civil Appeals Nos. 1048/70

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