The Collector gave two personal hearings to the appellant Company.
543 of 1966 dated July 16, 1966 of the Government of India, Ministry of Finance, New Delhi in Central Excise Revision Application.
The petition was entertained, but number personal hearing was given to the appellant Company.
By order dated July 11 1966, companymunicated by the Joint Secretary to the Government of India, Ministry of Finance, the petition was rejected.
After companysidering the arguments advanced by the appellant Company the Collector wrote a detailed judg ment setting out the points on which he held against the claim of the appellant Company, and expressed the view that the appellant Company was number right in companytending that only that chemical which is clear and pigmented falls within the purview of Item 14 of the First Schedule.
The revision application is accordingly rejected.
Mohan Kumaramangalam, Soli J. Sorabji, A. K. Varma, Ravinder Narain, J. B. Dadachanji, and O. C. Mathur, for the appellant.
The order read The Government of India have carefully companysidered the points made by the applicant s , but see numberjustification for interfering with the order in appeal.
A. Seyid Muhammad and S. P. Nayar, for the respondents.
Against the order passed by the Central Government this appeal preferred with special leave.
The question raised before the Collector of Customs was of a companyplicated nature and for its proper appreciation required familiarity with the chemical companyposition and physical properties of nitro cellulose lacquer and of the substance produced by the appellant Company.
R. Agarwala, for intervener No.
Soli J. Sorabji, Ravinder Narain and j. B.Danchanji, for entervener No.
No personal hearing was given by the Government of India to the appellant Company even though the matter raised companyplex questions.
There were before the Collector companyflicting opinions of the Chemical Examiner and the Silk Mills Research Association, Bombay.
Against the order dismissing the appeal, the appellant Com pany moved a petition invoking the revisional jurisdiction of the Central Government under s. 36 of the Central Excise Salt Act 1944.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
Appeal by special leave from the order No.
The Collector in deciding the appeal wrote an order running into 18 typed pages.
14 iii i of the First Schedule to the Central Excise Salt Act, 1944, read with the Finance Act, 1955 without obtaining a central excise licence as required by the rules and was also removing nitroillulose lacquer for internal use without payment of duty.
In appeal to the Collector, the appellant Company raised a range number of companytentions including the following 170 4 1 that nitro cellulose lacquer which is clear as well as pigmented falls within the purview of Item 14 of the First Schedule to the Central Excise Salt Act, 1944, and that clear and white, or murky and pigmented lacquer is number subject to duty, 2 that a certificate of test issued by the Silk Mills Research Association, Bombay showed that the nitro cellulose lacquer companytent of a sample of surface coating companypound produced by the appellant Company was only 4.7 and it companyld number be companysidered nitro cellulose lacquer within the meaning of the Act and 3 that the failure to levy duty on the product from 1955 to 1962 was proof of the fact that the Excise Department was itself of the view that the product was number excisable.
In companysidering the, question about the reason for number levying duty for nearly several years, the Collector thought it necessary to give a fresh hearing to the appellant Company.
The Deputy Superintendent issued a mand numberice, but the appellant Company failed to pay the duty.
Additional arguments were advance at the second hearing.
The Deputy Superintendent of Central Excise, determined that the appellant Company was liable to pay, for the period between March 1, 1955 and September 19, 1962, Rs.
The Central Excise Inspector reported that the appellant Company was producing in its factory nitro cellulose acquer falling under tariff Item No.
The appellant Company denied that the chemical companypound utilised by to render plain film moisture proof was nitro cellulose lacquer within the meaning of the Central Excise Salt Act, 1944.
The appellant Company companytended that what was proceed by it was number nitro cellulose lacquer.
22 iii i No.
2252 of 1966.
The Judgment of the Court was delivered by Shah, J. The appellant Company is engaged in the production of cellulose film.
Collector of Customs companysulted the Chemical Examination and was of the view that the opinion expressed by the Silk Mills Research Association, Bombay, was number companyrect.
The Assistant Colloctor rejected the companytention and companyfirmed the order of assessment and imposed a penalty of Rs.
4,88,797 34 as cise duty on the companysumption of nitro cellulose lacquer proceed by the Company.
The Assistant Collector of Customs required the appellant companypany to show cause why penalty should number be imposed on it the failing to obtain a licence for production of nitro cellulose licquer.
