LexTHE COLLECTOR OF CENTRAL EXCISE, PATNA versus TATA ENGINEERING AND LOCOMOTIVE CO. JAMSHEDPUR ETC.
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THE COLLECTOR OF CENTRAL EXCISE, PATNA
A
v.
TATA ENGINEERING AND LOCOMOTIVE CO.
JAMSHEDPUR ETC.
MAY 7, 1997
B
[S.P. BHARUCHA AND M. JAGANNADHA RAO, JJ.)
Industries (Development and Regulation) Act 1951, s. 9(1) r/w.
Automobile Cess Rules 1984, Rule 2-Value of motor vehicle for pwposes of
levy of ces~~Held, to be calculated applying provisions of Central Excises C
and Salt Act, 1944 and not as set out in Explanation to s. 9( 1 ).
S. 9 of the Industries (Development and Regulation) Act, 1951, ('IDR
Act') provided for imposition of cess on scheduled industries. Under the
proviso to sub-section (1) thereof, the rate of cess could not exceed two D
annas per cent of value of the goods. The Explanation thereunder stated
that the "value" would be deemed to be the wholesale cash price for which
goods of like kind were sold for delivery at the place of manufacture and
at the time of their removal therefrom without any abatement or deduction
whatever except trade discount and the amount of duty payable thereon.
Under a notification issued under s. 9(1) of the IDR Act, the rate of excise E
duty, to be collected as a cess, was fixed at 118 per cent ad valorem for
motor cars and all other automobiles.
The respondent assessee contended that the assessable value was to
be calculated according to Rule 3 of the Automobile Cess Rules, 1984 which F
provided that in relation to levy and collection of cess, the Central Excises
and Salt Act, 1944 would apply. The Tribunal accepted this contention.
Revenue appealed to this Court.
Dismissing the appeal, this Court
HELD : In calculating 1/8 per cent ad valorem, the value of the goods
was not be determined as set out in the Explanation to s. 9(1) of Industries
(Development and Regulation) Act. The provision relevant was Rule 3 of
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the Automobile Cess Rules, 1984, which stated that the provisions of the
Central Excise and Salt Act shall apply so far as may he in relation to the H
229
230
SUPREME COURT REPORTS [1997] SUPP. 1 S.C.R.
A levy and collection of the cess. The opening words of the Explanation to
s.9(1) made it clear that it defined "value" only for the purposes of that
sub-section. (232-G-11]
B
c
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 3596-97
of 1989 Etc.
From the Judgment and Order dated 4.6.87 of the Customs, Excise
& Gold (Control) Appellate Tribunal, New Delhi in A. No. 2094 and 2749
of 1986-A (Order No. 432-433/87-A).
C.V.S. Rao, S.D. Sharma and Sushma Suri for the Appellant.
V. Lakshmikumaran for M/s. J.B.D. & Co. for the Respondents.
The following Judgment/Order of the Court was delivered :
D
S.P. BHARUCHA, J. The Revenue assails the correctness of the
judgment and order of the Customs, Excise and Gold (Control) Appellate
Tribunal. The appeals involve the interpretation of Section 9 of the In-
dustries (Development and Regulation) Act, 1951, the notification dated
28th December, 1983, issued thereunder and Rules 2 and 3 of the
Automobile Cess Rules, 1984. The relevant provisions are reproduced :
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F
G
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The l11dustries (Developme11t & Regulatio11) Act, 1951 :
"S. 9. - Imposition of cess on scheduled industries in certain cases:
(1) There may be levied and collected as a cess for the purposes
of this Act on all goods manufactured or produced in any such
scheduled industry as may be specified in this behalf by the Central
Government by notified order a duty of excise at such rate as may
be specified in the notified order, and different rates may be
specified for different goods or different classes of goods :
Provided that no such rate shall in any case exceed two annas
per cent of value of the goods.
Expla11atio11 : In this sub-section, the expression "value" in relation
to any goods shall be deemed to be the wholesale cash price for
which such goods of the like kind and quality are sold or are
capable of being sold for delivery at the place of manufacture and
t
{
C.C.E.,PATNA v. TATAENGG.&LOCOMOTIVECO.[S.P.BHARUCHA,J.] 231
at the time of their removal therefrom, without any abatement or A
deduction whatever except trade discount and the amount of duty
then payable.
(2) The cess shall be payable at intervals, within such time and in
such manner as may be prescribed, and any rules made in this
behalf may provide for the grant of a rebate for prompt payment B
of the cess.
(3) The said cess may be recovered in the same manner as an
arrear of land revenue.
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