TaxTMI 
TaxTMI 
1985 (7) TMI 92
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....er functions was to be looked after directly by the Ministry of Food and Agriculture, Department of Agriculture, assisted by Development Councils constituted by the Government, and suitable grants were envisaged to the Indian Council of Agricultrual Research for the maintenance of Research Institutes and for carrying on the research activities, the Government felt need for larger investments on such projects in order to undertake an effective programme of research and development. Accordingly, it decided to continue the cess on the produce even after the abolition of the Commodity Committees. For the achievement of that objective Parliament enacted the Produce Cess Act, 1966 (shortly referred to as "the Act"). The Produce Cess Rules, 1969 were published on March 28, 1969. 3. The Act is a dual enactment. It provides for the levy and collection, as a cess, of customs duty on produce specified in the First Schedule to the Act exported beyond the limits of India. And it provides for the levy and collection, as cess, of excise duty on the produce specified in the Second Schedule. We are concerned in this case with the levy and collection of excise duty. 4. The appellant carries on....
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....ecution for not filing returns and paying the cess during the period when the Collector and appellate authority had not been appointed? And is the appellant not liable to cess at all for the products manufactured during such period? 8. It seems to us that the appellant is right in the contention that so long as the Collector is not appointed for the purposes of the Act no fault can be found with the appellant in not furnishing returns during such period. Section 8 of the Act requires the occupier of a mill to furnish to the "Collector" every month a return stating the total amount of produce, specified in the Second Schedule, consumed or brought under processing or extracted in the mill during the preceding month. The return has to be furnished before the seventh day of each month together with such other information as may be prescribed, and every such return is to be made in such form and to be verified in such manner as may be prescribed. There must be a Collector within the meaning of the Act to whom such monthly returns are to be furnished. The expression "Collector" has been defined by clause (a) of Section 2 of the Act to mean "the officer appointed by the Central Governm....
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....ed out earlier that the expression "Collector" has been specifically defined by the Act itself, and the definition requires that the officer must be one specifically appointed by the Central Government to perform the duties of a Collector detailed under the Act and Rules. There are other provisions which have been particularly enacted in the Act. They specify the persons who are liable to pay duty, their obligations, the powers and procedures in relation to assessment of the duty, the constitution of an appellate authority and its powers, and the powers of the Central Government to revise the appellate orders. Included also are specific provisions in respect of the recovery of sums due under the Act to the Government, and there are other incidental provisions. There is also an express provision by Section 20 empowering the Central Government to make rules to carry out the purposes of the Act, and particularly sub-section (2) of Section 20 envisages that such rules should provide for the form of the monthly return and the manner in which such return should be verified, the information which every occupier is required to furnish in the monthly returns and the manner in which assessme....
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.... is a good defence against a prosecution for non-compliance with Section 8 of the Act during that period. It does not, however, relieve the occupier of a mill from the burden of the levy. The levy is imposed by sub-section (2) of Section 3 of the Act and comes into existence immediately on the taxable event attracting excise duty. The accrual of the obligation to suffer the duty does not depend on the appointment of a Collector. The appointment of a Collector is only a part of the machinery designed by the Act for the assessment and recovery of the duty. The imposition and accrual of the duty is a thing apart from its assessment and collection. Now Section 8 requires the occupier to furnish a return every month stating the total amount of produce consumed or brought under processing or extracted in the mill during the preceding month. There is an obligation to file a return of the produce. There is a further obligation to file the return every month. Non-compliance with the latter obligation is sufficient to bring the occupier within the mischief of sub-section (2) of Section 9 of the Act. It empowers the Collector to proceed at once and make an assessment in the manner prescribed ....