Duty computation for mixed electricity supply must follow binding High Court method, with month-wise reassessment required.

Where electricity generated by the assessee was mixed with electricity purchased from an external source, duty liability had to be recomputed by first excluding the quantity supplied to associated companies before intermixture and then applying a month-wise computation. The binding High Court directions on the same facts and period controlled the assessment method, so a contrary departmental appellate view could not override that formula. The matter was remitted for fresh adjudication and the Collector was required to reassess the demand in accordance with the High Court's method after hearing the assessee.

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Issues: Whether the demand of central excise duty on electricity generated and consumed by the assessee was to be recomputed by excluding the quantity supplied by the external source before intermixture and by applying the computation on a monthly basis.

Analysis: The dispute centred on the method of determining duty liability where electricity generated by the assessee mixed with electricity purchased from an outside source. The Court held that the High Court had already directed the excise authorities to deduct the quantity supplied to associated companies from the external supply before intermixture and then to work out liability on a month-wise basis. The Board's contrary appellate view could not displace the binding effect of the High Court's order on the same facts and for the same period. The Collector was therefore required to apply the High Court-prescribed formula and reconsider the demand after giving the assessee an opportunity of representation.

Conclusion: The computation had to be redone in accordance with the High Court's directions, and the matter was sent back to the Collector for fresh adjudication.

Final Conclusion: The assessee obtained partial relief because the existing demand was not upheld as such and the authority was directed to reassess liability on the correct method laid down by the High Court.

Ratio Decidendi: Where a competent High Court has already determined the method of computation on the same facts and period, the excise authority is bound to apply that method, and a subsequent contrary departmental order cannot override it.

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