JUDGMENT

B.P. Jeevan Reddy, J.-Civil Appeal No. 960 of 1986 :

In this appeal preferred against the judgment of the Delhi High Court, two questions arise, viz., whether the malt and malt extract produced by the respondent, Barmalt (India) Private Limited (Barmalt), falls within the expression "food product" in Exemption Notification No. 55 of 1975 dated March 1, 1975 and whether the respondent is entitled to refund of the excess duty paid by him pending the decision of the High Court. The Assistant Collector took the view that malt and malt extract cannot be treated as food products and, therefore, not entitled to the benefit of the said Notification. On a writ petition being filed, the Delhi High Court upheld the respondent s plea and also held that it is entitled to the benefit of the said Exemption Notification. On the second issue, the Delhi High Court has overruled the Revenue s plea based on the theory of unjust enrichment. When this appeal came up for hearing on an earlier date, we held that the High Court was right in saying that malt and malt extract to qualify as food products and, therefore, the respondent has been rightly held entitled to the benefit of the aforesaid Notification. But then the question arose about the respondent s right to refund. On this aspect, we posted the matter for further hearing because of the peculiar situation arising in this matter, to which we shall now advert.

2. Consequent upon the decision of the High Court, Sri Harish Salve, learned counsel for the respondent says, the respondent, Barmalt, became entitled to refund of Rs.2,67,00,983.16p. which was the amount of duty paid by it. Pursuant to the impugned judgment of the High Court, it is stated, an amount of Rs.2,41,53,497.92p. has been refunded to it. The balance amount of Rs.25,47,485.24p. is still refundable to it. On these facts, in the ordinary course, we would have disposed of the matter in terms of Mafatlal Industries v. Union of India1 and the format order, which we have devised pursuant to the said judgment but Sri Harish Salve brought to our notice certain facts on the basis of which he asks for certain specific directions. The facts stated by him are the following :

3. The respondent, Barmalt, is one of the three major producers of malt and malt extract in the country. The other two being Malt Company of India Limited and A.K. Malt (Private) Limited. The malt and malt extract produced by these units is purchased by certain specified industries only. The industries purchasing malt and malt extract fall under two categories, (i) industries engaged in the manufacture of beverages, like Bournvita and Horlicks etc. and (ii) the breweries and distilleries engaged in manufacturing Indian Made Foreign Liqours. One of the category (i) industries is H.M.M. Limited, now known as Smith Kline Beecham Consumer Health Care Limited, respondent in the connected appeal. Like other purchasers in category (i), H.M.M. Limited took proforma credit of the duty paid by it on the purchase of malt/malt extract in terms of Notification No. 201 of 1979, which was in force at the relevant time. Other purchasers in category (i) also did the same. (So far as category (ii) purchasers, i.e., distilleries and breweries are concerned, Sri Salve says that they were not entitled to and did not avail of any proforma credit for the duty paid by them when they purchased malt/malt extract from the respondent or the other two units, as the case may be.) But when the Delhi High Court held, under the judgment impugned herein, that no duty was payable on the clearance/removal of malt and malt extract by virtue of Exemption Notification No. 55 of 1975, the Revenue was obliged to refund the duty collected back to Barmalt. Having done that, the Revenue served notices upon the purchasers of malt and malt extract (H.M.M. Limited and others) calling upon them to reverse the proforma credit taken by them and pay or adjust the duty payable accordingly. This put the purchasers like