2026-VIL-07-P&H-CE
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CENTRAL EXCISE High Court Cases

Central Excise - Cess on textile processing, Scope of Term ‘Manufacture’ - Petitioner are engaged in the business of processing of grey fabric by dyeing and not manufacturing textile products - Whether the Textile Committee was justified in levying cess on the petitioner's processing activities under Section 5A of the Textile Committee Act, 1963 – HELD - The definition of 'manufacture' under the Central Excise Act, 1944 and the Chapter Notes of the Central Excise Tariff Act, 1985 cannot be imported into the Textile Committee Act, 1963 since the 1963 Act does not contain any specific provision to that effect. The 1963 Act only refers to the levy of cess on the 'manufacture' of textiles, without defining the term. It is settled proposition of law that definition of another statute especially taxing statute cannot be borrowed unless and until specifically provided in such Act - The Textile Committee itself had acknowledged in a letter that cess should not be levied on independent processing units as the yarn on which cess has already been paid. The Textile Committee had later on exempted all textile units from the cess and subsequently repealed the Act itself, indicating that the Government itself was not in favor of levying cess on independent processing units - Further, the notices for cess were issued beyond the one-year limitation period prescribed under Rule 10 of the Textile Committee (Cess) Rules, 1975. Accordingly, the Textile Committee was not justified in levying cess on the petitioner's processing activities – The impugned orders are set aside and the petitions are allowed
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