UNION OF INDIA & ORS. versus TATA IRON & STEEL CO. LTD., JAMSHEDPUR

Citation: [1976] 2 S.C.R. 1044 · Decided: 17-12-1975 · Supreme Court of India · Bench: A.N. RAY · Disposal: Dismissed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
c 
D 
E 
F 
G 
H 
I 044 
UNION OF INDIA & ORS. 
v 
TATA IRON & STEEL CO. LTD., JAlvISHEDPUR 
December 17, 1975 
[A. N. RAY, C.L M. H. Boo, R. S. SARKARIA AND 
P. N. SHINGHAL, JJ.] 
Central Excises and Salt Act, 1944-Section 3 read with First Schedule, 
items 25 C<lld 26-Notification 30/6(} dated 1st March, 1960 in terms of Rule 
8 (I) of the Central Excise Rules, 1944 exempting steel ingots in which duty· 
paid pig iron is used-Interpretation of the Notification-Whether exemption is 
not available if duty-paid pig iron is mixed with other non-duty.paid materials. 
The respondent manufactures, as part of iron and steel products, ingot moulds 
and bottom stools from pig iron for use in steel melting shops. 
Under item 
25 and 26 and the first Schedule to the Central Excises and Salt Act, 1944, the 
respondent paid excise duty leviable on "pig iron and steel ingots., respec· 
lively. 
In terms of Rule 8(1) of the Central Exci~ Rules,. 1944, by a notification 
No. 30/ 60, the Central Government granted exemption to steel ingots falling 
under item 26 of the First Schedule if produced out of scraps obtaiued from 
duty-paid pig irons. Since unserviceable ingot moulds and bottom stools 
are 
also scrapped into pieces and remelted in an admixture with other non-duty 
paid scraps and hot metal in the manufacture of steel ingot9, the respondent 
claimed a set off of duty to the extent of duty paid on pig iron being the re• 
melted scrap used in the manufacture of steel ingots which was rejected by the 
Assistant Collector of Central Excise. The appeal before the Collector 
of 
Central Excise and the revision before the Ministry of Finance were dismissed, 
interpreting the Notification No. 30/60 as not applicable when duty-paid pig 
iron is mixed with other non-duty materials. 
When the orders of the Revenue Authority were challenged in the High 
Court, the High Court quashed them holding that ( i) the Revenue Authorities 
fell into the error of interpreting Notification No. 30/60 by confining exemption 
to steel ingots in which "entirely" "exclusively or only" duty-paid pig iron is 
used since no such wor.ds were used in the Notification; and (ii) the Notification 
would have to be interpreted in a manner that the statute would not cast a burden 
twice ove,r the payment of tax unless the language of the statute is so compell-
ingly certain to that effect. 
Dismissing the appeal by certificate and negativing the contentions of the 
appellant that the exemption is given for virgin pig iron and if pig iron was 
used and thereafter reduced to s'crap, there could be no exemption in respect of 
that scrap being different from pig iron and consequential refund of the duty-
paid on pig iron, the Court. 
HELD : (1) The only question is whether duty-paid pig iron is used along 
with non-duty-paid materials. Pig iron is made out of iron ore plus limestone 
plus coke. 
Pig iron is melted and processed into ingot moulds and bottom 
stools. Nothing is added to pig iron. When ingot moulds and bottom stools 
become unserviceable they are broken. This becomes scrap and is melted and 
used in the manufacture of steel ingots. All the time it is duty-paid pig iron 
which is processed into ingot moulds and bottom stools and again broken into 
scrap and melted in the making of steel ingots. [1048 E-F] 
(2) There cannot be double taxation on the same article. The analogy of 
the Revenue of the example of excise duty on motor cars, in spite of the fact 
that there was duty on tyres and duty on metal sheets was misplaced. [1048 G] 
(3) Notification No. 30 /60 granting exemption to duty-paid pig iron does 
not say that exemption is granted only when duty-paid pig iron is used. and that 
1 
, 
j 
UNION V. TATA IRON & STEEL CO. (Ray, C.J.) 
1045 
the exe'mption would not be available if duty-paid pig iron is mixed with other 
A 
non-duty-paid materials. [1048 H, 1049 A] 
( 4) The object of the Notification was to grant relief by exempting duty-
paid pig iron. If the intention of the Government were to exclude the exemp~ 
tion to duty-paid pig iron when mixed with other materials, then the Notification 
would have used the expression "only" or "exclusively" or "entirely'' in regard 
to duty-paid pig iron. [1049 A-Bl 
· 
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 723-737 of 
1971. 
From the Judgment and Order dated 18-4-1969 of the High Court 
of Judicature at Patna in Civil Writ Jurisdiction Case nos. 614 to 626 
of 1967. 
B 
) 
Shyamla Pappu,

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