1. KHALIL-UR-REHMAN KHAN, J.- The Maple Leaf Cement Factory Limited, an incorporated company, filed this Constitution petition on 14th June, 1974, for a declaration that the order of the Central Board of Revenue dated 25th January, 1974, rejecting partly its claim of abatement of duty as well as memo, dated 9th March, 1974, of the Central Board of Revenue are without lawful authority and of no legal effect. The petitioner also claimed an order restraining recovery of the excise duty as per demand notice dated 24th May, 1974. The dispute essentially pertains to the claim of abatement of duty for the year 1970-71. The contention of the petitioner company, which in the meantime was nationalised and now has been dc-nationalised, was that under the Excise Duty on Production Capacity (Cement) Rules, 1966, the production capacity of the factory of the petitioner was fixed at 2,25,000 tons and the rate of excise duty was fixed as Rs36/- per ton. It was asserted that in about July, 1970, kiln 2 of the factory was found to be no longer fit for operation on account of defects having developed in the livering Nos. 5 and 6 of the related shell. This fact was duly intimated to the respondent through a telegram. Kiln No.2 which statedly was of the capacity of 1,50,000 tons completely went out of operation on 18th October, 1970 and the factum of stoppage of the said kiln was reported by the Assistant Collector, Central Excise and Land Customs to the Superintendent, Land Customs, vide letter dated 22nd October, 1970. The petitioner consequent upon stoppage of kiln No.2 applied to the Central Board of Revenue for refixation of rated capacity.
2. It was added that the Collector in one of his letters confirmed that the procedure for payment of duty on actual production in case production of cement falls short of the proportionate annual production capacity will apply. The abatement claims were then lodged and the Central Board of Revenue vide memo dated 25-1-1973 allowed abatement of duty amounting to Rs. 1,63,323/- only from the duty leviable under rule 3 of the said Rules. The petitioner sought basis for allowing the claim to the aforesaid extent and the Central Board of Revenue provided basis for allowing the aforesaid amount of abatement vide its letter dated 28th February, 1973. It appears that the petitioner submitted a representation seeking increase in the amount of abatement for the year 1970-71 as well as for allowing abatement for the year 1971-72. The claim after consideration was rejected vide memo dated 9-3-1974. The Ministry of Production on representation of the petitioner replied vide memo dated 22-3-1974 that as regards the abatement for short-fall in production during the year 1970-71 if Capacity Taxation Rules have not been observed, the matter may again be taken up with the Central Board of Revenue. It is asserted that in view of this reply of the Ministry of Production the petitioner company was thinking of moving the Central Board of Revenue again but the Collector served the demand notice dated 11-4-1974 and the petitioner, therefore, instituted this petition in 1974.
2. The only point urged by the learned counsel for the petitioner in support of the petition is that as kiln No.2 having the capacity of 1,50,000 tons remained out of order for 148 days the amount of duty should have been received on the basis of actual production and as such allowing abatement to the extent of Rs. 1,63,323/- is illegal. A perusal of Annex. 'K' which discloses basis for allowing abatement to the extent of Rs. 1,63,323/- would show that the actual production of cement for the relevant year was to the extent of 1,69,451 tons as against the production capacity of 225,000 tons.
3. The Government waived 75% of the net loss. It is also important to note that despite the stoppage of kiln of the capacity of L50.000 tons the factory of the petitioner company did produce admittedly 1,96,451 tons of cement, working with only one kiln which had the capacity of 75,000 tons. The petitioner was supplied the reasons and the basis of the working of the abatement of duty allowed.
4. The said basis has not been shown to be illegal or arbitrary or whimsical This being the position there is no basis for interference in exercise of extraordinary constitutional jurisdiction. This petition, therefore, fails and is dismissed. The parties are, however, left to bear their own cost.