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PETITIONER: PIECO ELECTRONICS & ELECTRICALS LTD.

       Vs.

RESPONDENT: COLLECTOR OF CENTRAL EXCISE, PUNE.

DATE OF JUDGMENT:       24/10/1996

BENCH: S.P. BHARUCHA, S.C. SEN

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T      BHARUCHA, J:      This appeal  related to  the Provisional  Collection of Taxes Act, 1931.      The appellants  manufacture plastic piece parts such as radio cabinets,  knobs, etc.  The plastic  piece parts  fell within the  scope of  Entry 15A(2)  of  the  Central  Excise Tariff, but  they enjoyed  the  benefit  of  exemption  from payment of  excise duty under an Exemption Notification (no. 68/71).      The Finance Bill, 1982, was introduced in the Lok Sabha on 27th  February, 1982.  It proposed,  in clause  (49), the amendment of  the First  Schedule to the Central Excises Act in the manner specified in the Third Schedule thereto. Entry 15A was proposed to be amended.      Clause 2  of the  proposed amendment, with the which we are concerned,  read thus :      "(2) Articles of material described      in sub-Item (1), the      following,namely :      Boards,  sheeting,   sheets  films,      whether lacquered  or metalised  or      laminated or  not; lay that tubings      not   containing      any   textile      material.     Fifty  per   cent  ad      valorem."      The plastic piece parts fell outside the scope of Entry 15A (2)  as proposed  to be amended, and within the scope of the residuary Entry 68.      The said Bill contained the following declaration :      "Declaration under  the Provisional      Collection of Taxes Act, 1931.      It is  hereby declared  that it  is      expedient in  the  public  interest      that the  provisions of clauses 43,      44, 45,  46, 47, 49, 50, 51, 52 and      53  of   this   Bill   shall   have      immediate    effect    under    the      Provisional  Collection   of  Taxes      Act, 1931 (16 of 1931)."

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    The Provisional  Collection of  Taxes Act,  1931,  (the said Act)  is an  Act "to  amend the law providing immediate effect for  a limited period of provisions in Bills relating to the  imposition or  increase  of  duties  of  customs  or exercise". Section  2 thereof defines a "declared provision" to mean  "a   provision in  a Bill  in respect  of  which  a declaration has  been made under Section 3". Section 3 reads thus :      "3.  Power   to  make  declarations      under this Act - Where a Bill to be      introduced in  Parliament on behalf      of  Government   provides  for  the      imposition or increase of a duty of      customs  or   excise,  the  Central      Government may cause to be inserted      in the  Bill a  declaration that it      is expedient in the public interest      that  any  provision  of  the  Bill      relating   to  such  imposition  or      increase   shall   have   immediate      effect under this Act."      Under the  provisions of Section 4 a declared provision has the force of law immediately on the expiry of the day on which the Bill containing  it is introduced and it ceases to have the  force of  law under the provisions of the said Act when it comes into operation as an enactment.      It   was the  case of  the appellants that by virtue of the said  declaration. Entry  15A(2) had come into operation on the  expiry of  the  day  on  which  the  said  Bill  was introduced, that  is, on  28th February,  1982. The  plastic piece parts  fell outside  the ambit  of  Entry  15A(2),  as sought to  be amended, with effect from 28th February, 1982, and were then liable to excise duty under Entry 68. Prior to 28th February, 1982, there was no excise duty payable on the plastic piece parts because of the exemption aforementioned. Consequent upon  the proposed  amendment,  excise  duty  was payable  thereon   under  Entry  68.  There  was,  thus,  an imposition of  excise duty  on the  plastic piece parts and, by virtue  of the  said declaration,  the amendment of Entry 15A(2) came into effect on 28th February, 1982, so that from that date  they were  liable to excise duty under  Entry 68. The Tribunal  came to  the conclusion that the plastic piece parts continued  to remain  under  Entry  15A(2)  until  the enactment of   the  said Bill on 19th April, 1982, whereupon they became classifiable under Entry 68. It is that order of the Tribunal which is under challenge.      Learned   counsel for the appellants contended that the amendment of  Entry 15A(2)  brought about  an imposition  of excise duty on the plastic piece parts. The said declaration having been  made, the amended Entry 15A(2) came into effect on the  expiry of  the  day  on  which  the  said  Bill  was introduced, that is on 28th February, 1982. The basis of the submission was  that articles  falling under   the unamended Entry 15A(2)  were exempt  from the excise duty be reason of the aforesaid  Exemption  Notification.  By  reason  of  the proposed amendment  of Entry 15A(2), the plastic piece parts became liable  to duty  under Entry  68. The  plastic  piece parts were,  therefore, liable to excise duty under Entry 68 on and  after 28th   February,  1982. It  was also submitted that no attack by the Revenue on  its own declaration should be entertained.      As  we   see  it,  the  submission  on  behalf  of  the appellants proceeds  upon an erroneous footing. Section 3 of the said  Act empowers  the Government,  where a  Bill to be introduced  on   its  behalf  "provides  for  imposition  or

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increase of  a duty  of customs or excise", to insert in the Bill a  declaration that "any provision of the Bill relating to such  imposition or  increase shall have immediate effect under the  Act". What is requisite is that by reason  of the Bill the  customs or  excise statute is to be amended either to impose  duty for  the first time or , where it is already imposed, to increase it. By making the declaration under the said Act  the imposition  or increase becomes effective upon the introduction  of the  Bill. The  said Act  does not take account of  Exemption Notification  for they apply only when goods are  exigible to  duty but,  thereby,   the payment of duty or a part thereof is exempted.      The plastic  piece parts were, even under the unamended Entry 15A,  exigible to  excise duty  but, by  reason of the aforesaid Exemption  Notification, exempted from the payment thereof. That,  consequent, upon the amended Entry 15A,  the plastic piece  parts would  become liable  to the payment of excise duty  did not  mean that there was an "imposition" of excise duty  upon them  or that  they became  liable thereto under Entry 68, not when the said Bill was enacted, but from 28th February, 1982.      It cannot be held that in advancing the  argument which the Tribunal  accepted, as we do, the Revenue made an attack on its own declaration. The Revenue was entitled to urge the true scope  of the  declaration as applying only where there was, in  fact, an  imposition or  increase in excise duty by virtue of the said Bill.      The appeal is dismissed. No order as to costs.