Excise duty on post-manufacturing expenses is unlawful, while limitation and alternative-remedy objections do not defeat timely writ relief.

Excise duty on post-manufacturing expenses was treated as unlawful, following an earlier binding decision, so the objection to refund or relief on the basis of duty retention failed. The claim was held not to be barred by limitation because it was brought within three years of the decision declaring the levy unlawful, and the existence of an alternative remedy did not defeat writ relief where the levy was contrary to law and the claim was otherwise maintainable. Because the exact quantum of post-manufacturing expenses was not established on the record, the assessing authority was required to determine the amount after giving the petitioners an opportunity to adduce evidence.

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Issues: (i) whether excise duty was leviable on post-manufacturing expenses; (ii) whether the claim was barred by limitation and whether the existence of another remedy barred relief under Article 226 of the Constitution of India; (iii) whether the post-manufacturing expenses had to be determined by the assessing authority.

Issue (i): whether excise duty was leviable on post-manufacturing expenses.

Analysis: The levy on post-manufacturing expenses was held to be contrary to law in the light of the earlier binding decision of the Court, which was followed in the present batch of writ petitions. On that footing, the respondents' objection to refund or relief on the ground of retention of duty could not be sustained.

Conclusion: Excise duty was not leviable on post-manufacturing expenses, and the objection of the respondents was rejected.

Issue (ii): whether the claim was barred by limitation and whether the existence of another remedy barred relief under Article 226 of the Constitution of India.

Analysis: The claim was made within three years from the date on which the Court's decision declaring the levy unlawful was rendered, and it was therefore not barred under Rule 11 of the Excise Rules. The Court further held that, once the levy itself was clearly contrary to law and the claim was otherwise justified, the availability of another remedy and the fact that revision had been pursued did not prevent invocation of writ jurisdiction.

Conclusion: The claim was not barred by limitation, and the writ petitions were maintainable notwithstanding the alternative remedy.

Issue (iii): whether the post-manufacturing expenses had to be determined by the assessing authority.

Analysis: Since the exact quantum of post-manufacturing expenses had not been established on the material before the authority, the matter required determination after giving the petitioners a reasonable opportunity to produce supporting evidence.

Conclusion: The assessing authority was directed to determine the post-manufacturing expenses after affording the petitioners an opportunity to adduce evidence.

Final Conclusion: The challenge to levy succeeded, the respondents' objections failed, and the matter was left for fresh determination only on the limited question of quantification of the refundable amount.

Ratio Decidendi: Excise duty cannot be levied on post-manufacturing expenses, and where the levy is unlawful, limitation and alternative-remedy objections will not defeat writ relief if the claim is otherwise timely and maintainable.

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