IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Central Excise Ref. No.1 of 2004 Decided on: 13.10.2009 Commissioner, Central Excise, Chandigarh. …..Petitioner. VERSUS M/s.Himalyan Plastics Ltd. and anr. …..Respondents. Coram The Hon’ble Mr. Justice Deepak Gupta, Judge. The Hon’ble Mr.Justice V.K.Ahuja, Judge Whether approved for reporting?1No For the Petitioner: Mr.Sandeep Sharma, Assistant Solicitor General of India. For the Respondents: Mr.M.M.Khanna, Sr.Advocate with Mr.Goverdhan Sharma, Advocate. Deepak Gupta,Judge (oral) This application under Section 35H(1) of the Central Excise Act, 1944 has been filed seeking reference against the order passed by the Central Excise and Gold (Control) Appellate Tribunal dated 9.1.2003. The undisputed facts of the case are that both the respondents are manufacturers of HDPE pipes. It is not disputed that these pipes were exempt from excise duty upto 28.2.1994 and after the said date the 1 Whether the reporters of the local papers may be allowed to see the Judgment?Yes …2… exemption was withdrawn and the pipes became exigable to excise. On 28.2.1994, i.e., the last date on which exemption was available, both the respondents cleared certain goods from the factories. These goods were supplied and no excise duty was paid on it. These goods had been supplied to the Government Departments and were subject matter of rate contracts issued by the Director General Supplies and Disposals (DGS&D). As per the terms and conditions of the supply orders, despatch of the goods was to be made after physical inspection of the goods was carried out and a note was issued by the Inspecting authority that the quality of goods is acceptable. Admittedly, the inspection notes in the case were issued on 7th March, 1994. According to the revenue since the inspection notes were issued only on 7th March, 1994, the goods could not have been cleared from the factory prior to the said date. This is the sole point which arises for consideration. It is an undisputed fact that the goods were in fact inspected by the authorized authority appointed by the Government prior to 28.2.1994. The goods were cleared on 28.2.1994 but the inspection notes were issued …3… thereafter. According to the findings of the CEGAT, the contract itself provided that the goods had to be despatched within ten days of the issuance of the inspection note and this time could be extended upto a period of 60 days. If the goods were to be cleared after 60 days then re-inspection was required. There is a vast difference between the clearing of the goods for the excise purposes and despatch of the goods to the customer. Any manufacturer can clear goods from the factory and store them in the godowns for onward despatch to the customers. It may be true that in the present case, the goods were to be supplied under the DGS&D rate contracts but the fact remains that the goods had in fact been inspected prior to the clearance on 28.2.1994. Therefore, if the goods were cleared on 28.2.1994, it cannot be said that the view taken by the CEGAT is incorrect. We therefore, find no merit in the present application which is accordingly rejected. No order as to costs. ( Deepak Gupta ) Judge. (V.K.Ahuja) October 13, 2009(m) Judge …4…