Petitioner Wins Right to Adjust Accrued Money Credit Towards Duties for Goods at Different Units After Excise Duty Change.

The first writ application was dismissed as the scheme did not allow a cash refund of accrued money credit post-abolition of excise duty. However, the second writ application was successful, permitting the petitioner to adjust the accrued money credit towards duties payable for goods manufactured at different units. No costs were awarded.

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Issues Involved:
1. Refund of accrued money credit in cash after the abolition of excise duty.
2. Adjustment of accrued money credit towards duty payable after the abolition of the money-credit scheme.
3. Adjustment of money credit accrued from one manufacturing unit towards duty payable for another unit.

Summary:

Issue 1: Refund of Accrued Money Credit in Cash
The petitioner sought a refund of the accrued money credit in cash after the abolition of excise duty on vanaspati from July 23, 1996. The court found substance in the respondents' contention that the scheme did not provide for a cash refund. Referring to the decision in *Kusum Products Limited v. Union of India*, the court held that the petitioner is not entitled to a cash refund of the accrued benefit under the scheme. The first writ application (W.P. No. 137 of 2000) was thus disposed of with this observation.

Issue 2: Adjustment of Accrued Money Credit Post-Abolition of Scheme
The petitioner argued that the omission of the rules could not divest the accrued right to adjust the money credit towards duty payable for a subsequent period. The court agreed, citing Section 38A of the Central Excise Act, 1944, which preserves accrued rights despite amendments or repeals of rules or notifications. The court referenced the Supreme Court decisions in *Tungabhadra Industries Limited v. Union of India*, *Eicher Motors Limited v. Union of India*, and *Samtel India Limited v. Commissioner of Central Excise*, which supported the preservation of accrued rights. The court concluded that the petitioner is entitled to invoke the vested right to adjust the money credit as per the conditions of the original notification.

Issue 3: Adjustment of Money Credit Across Different Units
The petitioner contended that the money credit accrued from production at the New Alipore unit should be adjustable towards the duty payable for goods manufactured at the Bangannagar unit. The court examined the relevant provisions of the Central Excise Rules and found that the scheme did not restrict the utilization of money credit to the same manufacturing unit. The court held that the benefit of money credit could be applied across different units of the same manufacturer, as the credit accrues to the manufacturer and not to a specific unit. The second writ application (W.P. No. 983 of 2003) was thus allowed, and orders were issued in terms of prayers (a) and (b) of the writ application.

Conclusion:
The first writ application was dismissed as the scheme did not permit a cash refund. The second writ application succeeded, allowing the petitioner to adjust the accrued money credit towards duty payable for goods manufactured at different units. No costs were awarded.

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