Excise on injector

LEGAL DIGEST

The Supreme Court last week asked the Customs, Excise & Gold (Control) Appellate Tribunal to reconsider the case, Motor Industries Co Ltd vs Commissioner of Central Excise, raising the issue whether assembly of nozzles and nozzle-holders brought into existence a new product called "injector" inviting excise duty. The company insisted that the process did not amount to manufacture.

Rejecting its stand, the department imposed duty at 20 per cent ad valorem. The company moved the tribunal, which rejected its petition. The Supreme Court remitted the matter to the tribunal for reconsideration on three points, which include the process adopted by the company.

CrPC & loan recovery

The Supreme Court has held that a nationalised bank or any creditor has to execute a decree for recovery of loans according to the Civil Procedure Code and could not resort to special laws dealing with "state-sponsored schemes".

In this case, Central Bank of India got a decree against a debtor but it tried to invoke Uttar Pradesh Public Moneys (Recovery of Dues) Act to execute it. This was challenged by the debtor in the Allahabad high court. It dismissed his petition.

He appealed to the Supreme Court which held the high court wrong. The UP Act dealt with loans under 'state-sponsored schemes'. This was a loan for a motor vehicle. Therefore, the UP Act was not applicable, the Supreme Court said.

Relief for I-T delays

The Supreme Court has ruled that an income-tax assessee is entitled to get compensation by way of interest for the delay in the payment of amounts lawfully due to him which were wrongfully withheld by the department for inordinate periods.

In this appeal moved by Sandvik Asia Ltd, the delay was 17 years. The Supreme Court set aside the ruling of the Bombay high court which went against this principle and directed the Income Tax department to pay 9 per cent interest for the delayed period.

The court hauled up erring officials of the Income-Tax department and ordered that the copy of the judgment be sent to the Union Finance Minister for examination and taking appropriate action against the erring officials on whose "lethargic and adamant attitude" the department has to suffer financially.

HC to reconsider case

In the long-standing dispute between the management of Sudamdih Colliery of Bharat Coking Coal Ltd and Rashtriya Colliery Mazdoor Sangh, the Supreme Court has asked the Patna High Court to reconsider its earlier order to take back a group of workers with 75 per cent back wages. The high court had held that the concerned workers belonged to the colliery. The management denied it. The Central Industrial Tribunal declared them to be employees.

The high court confirmed this view. The management appealed to the Supreme Court. It found that the high court had not taken into account the principles laid down by it in the "Steel Authority of India" judgment of 2001. Therefore, it asked the high court to apply those principles in the colliery case and decide the case afresh.

Expressway project

The Supreme Court last week reserved judgment on the controversial Rs 2,250 crore Bangalore-Mysore expressway project. The Karnataka government has challenged the ruling of the high court allowing the work to proceed.

It argued before the Supreme Court that much surplus land was acquired by the construction company, Nandi Infrastructure Corridor Enterprises, to make undue profit.

The company, on the other hand, alleges that the project was tried to be stopped because of political reasons by ex-PM Deve Gowda.