TaxTMI 
TaxTMI 
1999 (7) TMI 80
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....ed company incorporated under the Indian Companies Act, 1961 (sic) with its registered office and Headquarters situated at Jaipur. Petitioner No. 2 is the Director of petitioner No. 1 company. In this petition the challenge is made to the levy of excise duty on the product manufactured by the petitioners, namely, woollen felt as an excisable item under Tariff Item No. 68 of Schedule I of the Central Excises and Salt Act (hereinafter referred to as the Act). Earlier the petitioner-company was being charged excise duty on woollen felt under Item 21 as if it was a woollen fabric. It was challenged on the ground that woollen felt did not fall under the term woollen fabric. The relief in the present petition is claimed in the form of exemptions ....
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....xemption shall not be applicable to a manufacturer if the total value of all excisable goods cleared by him or on his behalf in the preceding financial year had exceeded rupees thirty lakhs. Provided further that the exemption contained in this Notification shall apply to the first clearances for home consumption by or on behalf of the manufacturer referred to in this Notification, from one or more factories up to a value not exceeding rupees thirty lakhs during a financial year subsequent to 1977-78 and up to a value not exceeding rupees twenty-four lakhs during the period commencing on the 18th day of June, 1977, and ending on 31st day of March, 1978. Explanation I. - For the purposes of determining the value of any capital investme....
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....ered by them were not taken by the buyers and the goods were received back. Rs. 1,05,938.57 Bill discount (being cash discount) allowed to one party only. Rs. 1,60,109.00 Bill discount @ 5% on sales as per agreement." 4.The Assistant Collector examined the matter and considered the contentions of the petitioners which were raised in the following manner : "Shri N.K. Mishra, Chief Accountant of M/s. S. Zoraster & Co. Ltd., Jaipur appeared on behalf of the unit and further argued about the above deduction as below: Rs. 2,39,966.50. This relates to the value of goods which were despatched to the customers in year 1978-79 but were not received back in the same year. Since the goods have not been received back th....
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....n 12-3-1980 the date on which the case was heard. From the perusal of the sale vouchers issued by the unit, it will appear that the party has charged full value of the goods including the commission which was to be paid to M/s. A.K. Shah, Chaura Rasta, Jaipur and had also paid sales tax as per invoices value. Thus it will appear no amount has been deducted in form of discount at the time of sale of the goods. Even in the agreement dated 30th June, 1973 produced by the unit para 6 save that in consideration of the services to be rendered the company shall pay a commission @ 5% in net sale. Thus the commission paid by the unit to M/s. A.K. Shah, Chaura Rasta, Jaipur is in form of a remuneration to them for the services rendered and thus this ....
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.... not be added, does not have much reliance in the context of the nature of Central Excise. It is well established that in order to attract excise duty. It is not necessary that the articles must have actually been sold, that would equate to a sales tax, whereas excise duty is a tax on manufacture. Therefore, the argument that the appellant's goods were not actually sold would not in any way exclude it from the levy of Excise duty once it is held to be an excisable item. As regards the deductions on account of cash discount in respect of M/s. A.K. Shah, as also regarding the bill discount at 5% allowed to M/s. Rajasthan Enterprises Pvt. Ltd. consideration of their admissibility have to be seen in the light of criteria for allowing such a ....