Sc Quashes Writ Against Orient Paper, Telco

The Supreme Court has dismissed two appeals filed against Telco and Orient Paper Mills by the Central Excise collector saying the Industries (Development and Regulation) Act will not apply to assessment of cess on automobiles.

The court said the calculation of 1/8 per cent ad valorem of motor vehicles as cess will be as per the provisions of the Central Excise and Salt Act.

The revenue authorities had argued that the cess should be levied at the rate of 1/8 per cent of the actual value of the motor vehicle.

The value of the vehicle, which is being computed as per the Industries Development Act, is the selling price at the manufacturing unit without any abatement, except trade discount and duty then payable, they said.

 

The companies contended that the value of the motor vehicle for levying cess should be calculated as per the Central Excise and Salt Act and said Rule 3 of the Automobile Cess Rules clearly indicated this interpretation.

While accepting the argument of the companies, the division bench consisting of justice S P Bharucha and Justice M Jagannatha Rao said in this case the Central Excise Act will apply.

Earlier, the central excise and gold appellate tribunal (Cgat), too, had expressed similar views, which was challenged by the revenue authorities at the apex court.