Messrs SWAT TEXTILE MILLS LTD. vs PAKISTAN Through Secretary, Ministry Of Finance, Islamabad
This appeal by special leave challenged the validity of the levy of Central Excise duty on the basis of production capacity under subsection (4) of section 3 of the Central Excise and Salts Tax Act, 1944, inserted by the Finance Act, 1966. The core legal question involved the challenge to section 3 of the Act as ultra vires regarding the imposition of duty on the basis of capacity and actual production following amendments to the 1962 Constitution. The Supreme Court dismissed the appeal, noting that the issues raised were fully covered and settled by a prior common judgment of the Court in Zaibtan Textile Mills Limited v. Central Board of Revenue (PLD 1983 SC 358). The established principle is that matters concerning the constitutional validity of the production capacity tax provisions under the Central Excise and Salts Act stand resolved in accordance with the precedent set in the Zaibtan Textile Mills case.
- Whether section 3 of the Central Excise and Salts Tax Act, 1944, providing for the imposition of duty on the basis of production capacity, is ultra vires?
- Does the judgment in Zaibtan Textile Mills Limited v. Central Board of Revenue fully cover and govern challenges to the Central Excise duty levied on production capacity?
- Section 3(4), Central Excise and Salts Tax Act 1944
- Section 3, Central Excise and Salts Tax Act 1944
- Finance Act 1966
- Constitution (Sixth Amendment) Act 1966
1. ZAFFAR HUSSAIN MIRZA, J.-- In this appeal by special leave appellants Messrs Swat Textile Mills limited have challenged the validity of the levy of Central Excise duty on the basis of production capacity of their mills by the Central Board of Revenue, under subsection (4) of section 3 of the Central Excise and Salts Tax Act, 1944. Sub-section (4) was inserted by the Finance Act, 1966 so as to empower the Central Board of Revenue to create machinery to impose and recover duty of excise on various excisable goods on the basis of production capacity, of the mills, as an alternative for the levy of the said duty on the pre-existing basis of actual production of the excisable goods.
2. Leave was granted in this case to examine the contention challenging section 3 of the Act as ultra vires in so far as it provided for the imposition of duty both on the basis of "capacity and actual production", by means of amendment in the legislative entry No.43 in the 1962 Constitution, by the Constitution (Sixth Amendment) Act, 1966. The leave order proceeded on the basis that a number of similar petitions involving the similar law points were allowed and leave was granted to examine these points.
3. Both the learned counsel for the parties have pointed out to us that this Court has disposed of the connected appeals by a common judgment reported as Zaibtan Textile Mills Limited v. Central Board of Revenue PLD 1983 SC 358 and concede that the decision in the present appeal turns on the said judgment which fully covers the points', raised in it.
4. Accordingly this appeal is dismissed with no order as to costs..
Cited by 2 cases
- Syed Subtain Kazmi And 2 Other vs Syed Mumtaz Hussain Kazmi And 5 Other K.L.R. 2013 Supreme Court 261
- Syed Subtain Hussain Kazmi, Tehsildar, Presently posted at Bagh Deve_ba07e1d9 2013-SC AJK-36