H.M.M. LTD. versus COLLECTOR OF CENTRAL EXCISE, NEW DELHI

H.M.M. LTD. versus COLLECTOR OF CENTRAL EXCISE, NEW DELHI

The assessee is entitled to take credit for the entire duty paid on inputs received into its Rajahmundry factory against the duty payable on goods cleared from that factory without the requirement of correlation between inputs and finished goods, as the scheme under Notification No. 201 of 1979 and the relevant...

Source-derived case information.

Parties
Appellant: H.M.M. Ltd.; Respondent: Collector of Central Excise, New Delhi
Jurisdiction
India
Judgment Date
11 October 1996
Procedural Posture
Civil Appeal / Supreme Court Appeal From the Order of Customs Excise and Gold (control) Appellate Tribunal, New Delhi
Outcome
Appeal allowed
Legal Topics
Central Excise, Exemption Notification, Credit of Duty on Inputs, Construction of Statutes
Taxation Law Central Excise Exemption Notification Credit of Duty on Inputs Construction of Statutes

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Parties

H.M.M. Ltd.

Appellant

Collector of Central Excise, New Delhi

Respondent

Procedural Posture

Civil Appeal / Supreme Court Appeal From the Order of Customs Excise and Gold (control) Appellate Tribunal, New Delhi

Legal Issues

  1. 1 Whether the assessee is entitled to take credit for the entire duty paid on inputs (barley malt) received into its factory as against the duty payable on goods cleared at that factory under Notification No. 201 of 1979, even though only a part of the manufactured goods are cleared and the rest transferred to other factories.

Ratio Decidendi

The assessee is entitled to take credit for the entire duty paid on inputs received into its Rajahmundry factory against the duty payable on goods cleared from that factory without the requirement of correlation between inputs and finished goods, as the scheme under Notification No. 201 of 1979 and the relevant rules permit such set-off and do not mandate proportional credit only. The Tribunal's contrary view is incorrect in law.

Court Disposition

Appeal allowed

Orders

  • Tribunal's order set aside.
  • Assessee entitled to take credit of the entire duty as claimed.