Case Note & Summary
A batch of writ petitions was filed by several manufacturers of tobacco and tobacco products under Articles 226 and 227 of the Constitution of India before the High Court of Karnataka, challenging Notification No.3 of 2019 dated 06.07.2019 issued by the Union of India under Section 5A of the Central Excise Act, 1944. The notification levied Central Excise duty on tobacco and tobacco products. The petitioners contended that the levy was illegal on various grounds including lack of power under Article 246 read with Entry 84 of List I post GST and introduction of Article 246A, the aspect of subsumation of manufacture in supply, the legality of NCCD as a surcharge under Article 271, and violation of Article 14. The respondents defended the notification. The court heard arguments and reserved judgment on 05.10.2021, and pronounced orders on 04.01.2022. However, the text of the judgment is incomplete and does not contain the court's analysis, findings, or final decision.
Issue of Consideration
Whether Notification No.3/2019 dated 06.07.2019 issued under Section 5A of the Central Excise Act, 1944 levying Central Excise on tobacco and tobacco products is valid and legal?
Case Details
2022 LawText (KAR) (01) 20
W.P. No.52371/2019 and connected matters
Justice S. Sunil Dutt Yadav
For Petitioners: C.S. Vaidyanathan, Senior Advocate; K.G. Raghavan, Senior Advocate; and others. For Respondents: M. Venkataraman, Additional Solicitor General; and others.
M/s. V.S. Products and Other Manufacturers of Tobacco Products
Union of India and Commissioner of Central Tax
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Nature of Litigation
Writ petitions under Articles 226 and 227 challenging the validity of a central excise notification.
Remedy Sought
Quashing of Notification No.3 of 2019 dated 06.07.2019 issued under Section 5A of the Central Excise Act, 1944.
Filing Reason
The notification levied Central Excise duty on tobacco and tobacco products, which the petitioners claimed was illegal and unconstitutional.
Issues
Whether the notification is valid considering the scope of Article 246 read with Entry 84 List I post GST regime and introduction of Article 246A?
Whether the concept of manufacture is subsumed in supply and the aspect theory affects the levy?
Whether the levy of NCCD under Section 136 of the Finance Act, 2001 is legal?
Whether NCCD is a surcharge under Article 271 and its validity?
Whether levy of excise duty during exemption period is valid?
Whether the levy is violative of Article 14 of the Constitution?
Judgment Excerpts
The petitioners are stated to be manufacturers of Tobacco and Tobacco products and are regist...
This Order has been divided into the following Sections to facilitate analysis: I Preamble, II Contentions of Petitioners, III Contentions of Respondents, IV Consideration : A. Power under Article 246 r/w Entry 84 list I post, the GST Regime and Introduction of Article 246A of the Constitution of India B. Taxing of taxable event, Aspect Theory and Subsumation of manufacture in Supply...
Procedural History
Writ petitions filed challenging Notification No.3/2019; heard and reserved for orders on 05.10.2021; order pronounced on 04.01.2022.
Acts & Sections
- Central Excise Act, 1944: Section 5A
- Constitution of India: Article 226, 227, 14, 246, 246A, 271, Entry 84 of List I
- Finance Act, 2001: Section 136
