ORDER
Arun Mishra, J.
1. In these seven writ petitions common question is involved. Petitioners in these writ petitions are public limited companies. The only question posed for decision is at what point of time petitioners are liable to pay the excise duty while taking out the raw material for the manufacture of the explosives to the mine site or after the manufacture is made at the mine site and the vehicles are brought back to premises of factory from the mine site.
2. The facts are taken from W.P. No. 4528/1993. Petitioners submit that they are dealing in the field of industrial explosives and allied technology. They are manufacturing explosives for nationalised coal fields for the purpose of blast. They are also manufacturing a wide range of products including paints, rubber chemicals, speciality chemicals, catalysts, pharmaceuticals, agro chemicals, seeds, etc.
3. It is submitted by the petitioners that they have the unit at Singrauli, District Sidhi. The SMS plant has two components. Support plant and bulk mixing and delivery vehicles (commonly known as Pump trucks). Internationally in order to increase the quality and potency of industrial explosives a new technology has been developed called bulk explosives. Initially in India Industrial Explosives was manufactured at plant site and delivered to consumers in packages. By a process of evolution and technological advancement an internationally acceptable system has been evolved called the bulk explosive system which means that from the support plant the raw material and components necessary to produce/manufacture explosive are carried in mechanically propelled vehicles to the mine site for production/manufacture into explosive at the bore notes. The manufacturing process takes place at the time of delivery at the mine site into bore holes.
4. It is further averred that what is carried from the support plant at Singrauli in the mechanically propelled pump trucks in separate compartments are some of the following items :
(i) A pre-mix of ammonium nitrate and other ingredients,
(ii) A Gas Agent (Sensitizer); and
(iii) In some cases some more ingredients like expanded parlite aluminium and diesels.
5. A support plant consists of storage unit for raw material, administrative and other infrastructural facilities. Bulk explosive delivery system is a state of art technology. The pump truck which is a manufacturing-cum-delivery unit in itself consists of :
(i) Chambers to contain various raw materials for manufacture ofexplosives;
(ii) Hydraulic Motors and pumps and augurs so as to facilitate aproper mixing of the materials at a different percentage of com-position.
(iii) A Power Take of Unit (PTU), uniquely designed to drive energy from the engine of the vehicle itself to run above electrically,
(iv) The Control Panels and meters providing the required levers to ascertain the propelled manufacturing of product at the site.
6. Manufacturing process of the petitioner unit is governed by a licence issued under the Indian Explosives Act, 1884 read with the Explosives Rules, 1983.
7. It is further averred that petitioner-company is not empowered under the licence to manufacture explosive at the support plant site since such plants are located in habitable areas. The vehicles brings back to the support plant the residual raw materials-only and not explosives. The licence has now been converted into a certificate of Registration from 1992, in terms of Rule, 174 and 192 of the Excise Rules. The pump trucks of the petitioner-company before entering the mine site are weighed and are re-weighed while departing after manufacturing and discharging the explosives in the bore holes. The industrial explosives produced by the petitioner company can be purchased by only such companies or persons who have a valid licence to possess and use industrial explosives under the Indian Explosives Act. Petitioner submits that as per the prevailing system of payment of Excise Duty is on the basis of the Gate Pass issued after determining the exact quantity of explosive delivered to Northern Coalfields Ltd. and other subsidiaries of Coal India Ltd. The payments have been made fruitfully and faithfully without any relax. Petitioner submits that as per Entry 84 in List I of Seventh Schedule provides that duties of excise shall be levied on goods manufactured and produced in India. The event of taxation is the point of manufacture which is at the mine site. Assistant Collector of Central Excise, District Satna, insisted that the excise duty should be paid at the point when the pump truck leaves the support plant premises for the mine site. The event of taxation is being preponed to a stage which is anterior in point of time to manufacture. It is submitted that certain material which is not used has to be accounted and taxable event is the manufacture before which excise duty cannot be levied.
8. A return has been filed by the respondents in which it is contended that the prescribed procedure for clearance of such goods out of the manufacturing premises as envisaged under Central Excise Rules namely 9(1), 52A, 53, 173F, 173G and 226 has to be followed. The production of the goods has to be properly recorded in prescribed statutory records i.e. in R.G. 1 register and clearance of the same has to be effected under cover of G.P. 1 (under Rule 52A) on payment of Central Excise duty under Rule 9(1) before removal of the said goods from the manufacturing premises. In the registration certificate it has been declared by the petitioner that they will be manufacturing explosives at their factory premises as per ground plan submitted to the Central Excise authorities while seeking registration.
9. It is further contended by the respondents that the factory premises is certainly not the mining site as claimed by the petitioner. Thus, petitioner company is liable to pay appropriate excise duty at the time of removal of goods in pump truck filled with explosives in accordance with theRules. It is further contended by respondents that the explosives manufactured by the petitioner are covered under 'Self Removal Procedure' as envisaged under Chapter VIIA, of Central Excise Rules. According to the said procedure, the petitioner-company is duty bound to assess and pay Central Excise duty and thereafter can remove the goods from their factory on their own accord. The petitioner instead of following the 'prescribed procedure of assessing and paying the duty before clearing the goods from the factory' have been claiming to clear the goods without payment of Central Excise duty and discharge duty liability only after the goods i.e. explosives have been consumed at the mine site. After manufacture of prepared explosives these are filled in the chambers of a specially designed pump truck and removed from the factory for supply at the mining site. After delivery of the explosive material with the help of pump truck in the bore holes at the mining areas, the petitioner claims to enter the production of the explosives in the R.G. 1 register and 'issue gate passes thereafter'. Some quantity of explosives which is not consumed in the bore holes in brought back to the factory without intimation to the Central Excise authorities and without following Central Excise Rules and procedure laid down in this regard. The clearance of the goods without recording its production and transportation without coverage of prescribed documents is not only against the 'interest of revenue' but a 'high security risk'. The intention of the petitioner is to avoid the payment at factory gate and the goods are brought back to the factory, for that there is a complete procedure prescribed under the Central Excise Rules.
10. Shri Vivek Tankha, learned Senior Counsel appearing for the petitioners, has submitted that in various states different procedure for assessment is being adopted. He has submitted that in certain States the Department is insisting for payment after the manufacture takes place. In State of M.P. also earlier the procedure was the same and excise duty was being paid after manufacture has taken place at the mine site. He has submitted that there should be uniform procedure of such taxing events as may be laid down by Central Board of Excise and Customs under Section 37B of the Central Excise Act, 1944. He has relied upon a circular issued by the Govt. of India, Ministry of Finance (Department of Revenue), Central Board of Excise and Customs, New Delhi, dated 18-11-96 in which Central Board of Excise and Customs considered the representation regarding difficulties being faced in despatching Liquid Gases in tanker lorry on account of the exceptional nature of the goods are actually delivered from the specialized cryogenic tankers into the tankers of the buyers. As a result it is 'not possible to ascertain the quantum of the goods' and the duty involved therein at the time of 'clearance' and therefore the preparation of Modvatable invoice meant for an individual buyer, and payment of duty at the time of clearance is difficult. A request for prescribing a suitable procedure has been made, the Board has issued the directions as mentioned in the circular.
11. Smt. Indira Nair, learned Sr. Counsel appearing on behalf of the respondents, has submitted that the mode of assessment adopted by the Department is proper, however, in case petitioner approaches the Central Board of Excise and Customs, it is for the petitioner to submit the representation as provided under Section 37B.
12. The provisions of Section 37B of the Central Excise Act, 1944, makes it clear that Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963), may, if it considers it necessary or expedient so to do for the purpose of uniformity in the classification of excisable goods or with respect to levy of duties of excise on such goods, issue such orders, instructions and directions to the Central Excise officers as it may deem fit, and such officers and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions of the said Board.
13. I find that prayer made by the petitioner to approach the Central Board of Excise and Customs, New Delhi, under Section 37B has not been seriously opposed.
14. Without expressing any opinion on the merits of the case and the rival submissions advanced, petitioners may if so advised, prefer representation before the Central Board of Excise and Customs. New Delhi under Section 37B. On the representation being so filed, the same may be dealt with in accordance with Section 37B as far as possible within four months. For the period of four months, let status quo with respect to the mode of recovery of excise duty as per the interim order passed in these writ petitions be maintained. Writ petitions are disposed of. No order as to costs. Security if deposited be refunded to the petitioner.