AHMEDABAD MANUFACTURING AND CALICO versus UNION OF INDIA AND ORS.

AHMEDABAD MANUFACTURING AND CALICO versus UNION OF INDIA AND ORS.

Excise duty cannot be levied on the weight of yarn after it is sized for the purpose of weaving into fabrics, as the process of sizing does not alter the basic commodity. The retrospective amendments to the relevant Rules and Section 51 are constitutional but do not justify levying duty on sized yarn.

Parties
Petitioner: AHMEDABAD MANUFACTURING AND CALICO PRINTING CO. LTD. AND ANR.; Respondent: UNION OF INDIA AND ORS.
Jurisdiction
India
Judgment Date
12 January 1993
Procedural Posture
Writ Petition (civil) Under Article 32 of the Constitution of India / Supreme Court Decision on Merits
Outcome
Petitions allowed.
Legal Topics
Excise Duty, Retrospective Amendments, Validity of Notifications, Levy on Yarn Weight
Taxation Constitutional Law Excise Duty Retrospective Amendments Validity of Notifications Levy on Yarn Weight

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 2 Authorities cited 5 Party arguments 2
Sign in to unlock

Parties

AHMEDABAD MANUFACTURING AND CALICO PRINTING CO. LTD. AND ANR.

Petitioner

UNION OF INDIA AND ORS.

Respondent

Procedural Posture

Writ Petition (civil) Under Article 32 of the Constitution of India / Supreme Court Decision on Merits

Legal Issues

  1. 1 Whether excise duty can be levied on the weight of sized yarn, including sizing material, under Items 18.1, 18.III, and 18E of the Central Excise Tariff.
  2. 2 Whether retrospective amendments to Rules 9 and 49 of the Central Excise Rules, 1944 and Section 51 of the Finance Act, 1982 are valid.

Ratio Decidendi

Excise duty cannot be levied on the weight of yarn after it is sized for the purpose of weaving into fabrics, as the process of sizing does not alter the basic commodity. The retrospective amendments to the relevant Rules and Section 51 are constitutional but do not justify levying duty on sized yarn.

Court Disposition

Petitions allowed.

Orders

  • All impugned show cause notices quashed.
  • No order as to costs.