Judgment R.A.Sharma, J. 1. Whether Rule 57F-(1)(ii) of the Central Excise Rules, as it was before its amendment made in 1995 in so far as it provides for payment of excise duty on the duty paid inputs brought into factory under MODVAT Credit Scheme, but removed there from for sale in market or for export on the basis "as if such inputs have been manufactured in the said factory", is ultra vires the Rules making power of the Central Government, is the question, which is involved in this writ petition. 2. The petitioner No. 1 (hereinafter referred to as the petitioner) manufactures commercial motor vehicles excavatore and cranes in its factory at Jamshedpur. The petitioner No. 2 is its partner. The petitioner in order to take advantage of the MODVAT Credit Scheme brought duty paid inputs in its factory for using them in or in relation to the manufacture of its final products. However, all the inputs brought in the factory under the said Scheme were not used by the petitioner in the remanufacture of its final products and unused inputs were sold in the open market. The Excise Department issued three notices dated 22.6.1988, 23.6.1988 and 7.9.1988 asking the petitioner to show cause as to why penalty be not imposed upon it for contravention of the Rules and why the excise duty on the unused inputs sold in the open market be not realised in accordance with Rule 57F(1)(ii) of the Central Excise Rules, 1944 (hereinafter referred to as the Rules). The petitioner submitted its reply. Thereafter, the department issued orders dated 30.11.1989/1.12.1989 and 12.12.1989 holding that the excise duty on the unused duty paid inputs sold in the open market is to be levied on the basis of the price at which they were sold by the petitioner in accordance with Rule 57F(1)(ii). Being aggrieved by the said notices and the orders the petitioner has filed this writ petition. It has also challenged the trade notice dated 7.2.1989 alongwith the Boards Circular dated 22.12.1989, which has been referred to in the impugned orders. 3. Being aggrieved by the said notices and the orders the petitioner has filed this writ petition. It has also challenged the trade notice dated 7.2.1989 alongwith the Boards Circular dated 22.12.1989, which has been referred to in the impugned orders. 3. In exercise of Rule making power conferred on it Sec. 37 of the Central Excise Act (hereinafter referred to as the Act) the Central Government has formulated a scheme, known as MODVAT Credit Scheme (hereinafter referred to as the Scheme) for the purpose of allowing credit of excise duty paid on the goods used in or in relation to manufacture of final excisable goods/product. The Scheme for inputs is contained in Rules 57A to 57J. Rule 57A allows the credit of excise duty paid on the excisable goods used as inputs in or in relation to the manufacture of the final products and permits the utilisation of the credit so allowed towards payment of the duty on the final products. As the controversy in the present case relates to the period prior to the year 1994-95 the MODVAT RULES (57A to 57J) as they were before the amendment in 1995 are relevant. Therefore, the unamended Rules will be cited and referred to in this judgment hereinafter. 4. Rule 57A so far as it is relevant is reproduced below: Rule 57A Applicability-(1) the provisions of this Section shall apply to such finished excisable goods (hereinafter referred to as the "final products"), as the Central Government may, by notification in the official Gazette, specify in this behalf, for the purpose of allowing credit of any duty of excise or the additional duty under Sec. 3 of the Customs Tariff Act, 1975 (51 of 1975), as may be specified in the said notification (hereinafter referred to as the "specified duty") paid on the goods used in or in relation to the manufacture of the said final products (hereinafter referred to as the "inputs") and for utilising the credit so allowed towards payment of duty of excise leviable on the final products, whether under the Act or under any other Act, as may be specified in the said notification, subject to the provisions of this Section and the conditions and restrictions that may be specified in the Notification; Provided that the Central Government may specify the goods or classes of goods in respect of which the credit of specified duty may be restricted. Rule-57F, which the laid down manner of utilisation of the inputs and the credit allowed in respect of duty paid thereon, in so far as it is relevant, is also reproduced below.- Rule 57F. Manner of utilisation of the inputs and the credit allowed in respect of duty paid thereon: (1) The inputs in respect of which a credit of duty has been allowed under Rule 57A may- (i) be used in, or, in relation to the manufacture of final products for which such inputs have been brought into the factory; or (ii) be removed, subject to the prior permission of the Collector of Central Excise, from the factory for home consumption or for export or payment of appropriate duty of excise or for expert under bond, as if such inputs have been manufactured in the said factory. (emphasis supplied). Provided that where the inputs are removed from the factory for home consumption on payment of duty of excise, such duty of excise shall in no case be less that the amount of credit that has been allowed in respect of such inputs under Rule 57A. The inputs in respect of which the credit of duty was been allowed under Rule 57A are to be used in or in relation to the manufacture of the final products for which purpose they were brought into the factory, but if such inputs are not used in manufacture of the final products, and are removed from the factory for sale in open market they are to be assessed to excise duty on the basis as if they have been manufactured in the said factory in accordance with Rule 57F(1)(ii). The result is that the inputs, which instead of being used in manufacture of the final products are sold in the market, are assessed to the excise duty on the basis of the sale price obtained by the manufacturer who has taken credit of excise duty paid thereon. 5. The result is that the inputs, which instead of being used in manufacture of the final products are sold in the market, are assessed to the excise duty on the basis of the sale price obtained by the manufacturer who has taken credit of excise duty paid thereon. 5. The Learned Counsel for the petitioners has challenged Rule 57F(1) (ii), in so far as it provides for payment of excise duty on unused inputs removed from the factory for sale on the basis "as if such inputs have been manufactured in the said factory" on two grounds, namely, (i) the Rule creates a fiction which can be created by the legislature only and not by the Rule making authority, and (ii) by the said fiction the excise duty is levied not on the production/manufacture of the inputs but on their sale price and thus it is tax on the sale and not a duty on production/manufacture of goods. Elaborating his submission, the Learned Counsel has pointed out that the duty paid inputs which were brought into the petitioners factory were manufactured by another manufacturer an not by the petitioner, but by the impugned fiction the petitioner is deemed to be their manufacturer although in fact it is not so, on account of which the duty is levied on the sale price of the inputs which were sold in the market. It is contended that such a duty is outside the purview of the Act. For the reasons given hereinafter the above submissions cannot be sustained. 6. In order to Judge the validity of the subordinate legislature it is necessary to find out what is the area 6ver which and the purposes for which the power to make such a legislation has been delegated. Therefore, the answer to the question as to whether such a fiction as is contained in Rule 57F(1)(ii) can or cannot be created by the Government depends on the scope of the Rule making power. Sec. 37 which has conferred power on the Central Government to make Rules, insofar as it is relevant, is as under: Sec. 37. Power of Central Government to make Rules.-(1) The Central Government may make Rules to carry into effect the purposes of this Act. (2) in particular, and without prejudice to the generality of the for going power, such Rules may- (i)... Power of Central Government to make Rules.-(1) The Central Government may make Rules to carry into effect the purposes of this Act. (2) in particular, and without prejudice to the generality of the for going power, such Rules may- (i)... xxxxxxxxxxxxxxxx (xvia) provide for the credit of duty paid or deemed to have been paid on the goods used in, or in relation to the manufacture of excisable goods; (xvib) provide for the giving of credit of sums for money with respect to raw materials used in manufacture of excisable goods; ... Sub-sec. (1) of Sec. 37 gives power to the Central Government to make Rules "to carry into effect the purposes Government to make Rules" to carry into effect the purposes of the Act". Sub-sec. (2) of the said section, without prejudice to the generality of the power conferred by Sub-sec. (1), enumerates topics/subjects with regard to which Rules can be framed by the Government. It is well settled that where a statute confers general Rule making power and without prejudice to the generality of the power already conferred, also confers specific power by enumerating the topics/subjects with regard to which Rules are to be made, the specific power is only illustrative and it cannot restrict the general power. Therefore, enumeration in Sub-sec. (2) is not exhaustive and is only illustrative. The Supreme Court in Assistant Collector of Central Excise V/s. Ramakrishnan Kulwant Rai 1989 Supp. (1) SCC 541, has, while interpretation Sec. 37 of the Act, laid down as follows: ...Sec. 37 dealt with power of Central Government to make Rules. Sub-sec. (1) said: "The Central Government may make Rules to carry into effect the purpose of this Act." Sub-sec. (2) enumerated the matters the Rules might provide for in particular and "without prejudice to the generality of the foregoing power". Thus, the section did not require that the enumerated Rules would be exhaustive. Any Rule if it could be shown to have been made "to carry into effect the purpose of the Act" would be within the Rule making power." 7. As Sub-sec. (1) of Sec. 37 has conferred the Rule making power on the Central Government for giving effect to the purposes of the Act, it is necessary to find out as to for what purposes the Act has been enacted. 8. As Sub-sec. (1) of Sec. 37 has conferred the Rule making power on the Central Government for giving effect to the purposes of the Act, it is necessary to find out as to for what purposes the Act has been enacted. 8. Sec. 3 of the Act, which is a charging section provide for levy and collection of the excise duty on all excisable goods produced or manufactured in India at the rates setforth in the Schedule to the Central Excise Tariff Act, 1985. According to Sec. 4 the Excise duty is to be charged on the excisable goods with reference to the price at which such goods are ordinarly sold in course of wholesale trade. Sec. 5A gives power to the Central Government to exempt any excisable goods from payment of duty by notification either absolutely or subject to such condition as may be specified. Under Sec. 37 the Central Government is empowered to frame Rules with regard to various matters including the MODVAT CREDIT Schemes. 9. The Act is undoubtedly a revenue yielding Act. Its object is to impose the excise duty on the production/manufacture of the excisable goods which the producer/manufacturer can pass on to the consumer. But this is not its sole purpose. One of its important purposes is to control and regulate the economy of the country. The Government regulates an controls the economy by exercising its powers under various provisions of the Act. In Union of India V/s. Paliwal Electricals (P) Ltd. and Anr. -- , the Supreme Court while dealing with the power of exemption granted to the Government under the Central Excise Act has laid down as follows: The power of exemption is a potent weapon in the hands of the Central Government to regulate and manage the economy and to achieve the various social and economic objectives of the State. As observed by this Court in Supreme Court Employees Welfare Ass. V/s. Union of India dealing with Sec. 25 of the Customs Act, 1962 which is in pan material with Rule 8: (SCC p. 332, para 22). It is a power given to the Central Government to be exercised in public interest. Such a provision has become a standard feature in several enactments and in particular, taxing enactments. V/s. Union of India dealing with Sec. 25 of the Customs Act, 1962 which is in pan material with Rule 8: (SCC p. 332, para 22). It is a power given to the Central Government to be exercised in public interest. Such a provision has become a standard feature in several enactments and in particular, taxing enactments. It is equally well settled by now that the power of taxation can be used not merely for raising revenue but also to regulate the economy, to encourage or discourage as the situation may call for, the import and export of certain goods as also for serving the social objectives of the State. Vide Elel Hotels and Investments Ltd. V/s. Union of India Sri Srinivasa Theatre V/s. Govt. of T.N. and Suhhash Photographies V/s. Union of India. Since Parliament cannot constantly monitor the needs of and the emerging trends in the economy and is in no position to engage itself in day- today regulation and adjustment of import-export trade accordingly, power is conferred upon the Central Government to provide for exemption from duty of goods, either wholly or partly, and with or without conditions, as may be called for in public interest. We see no warrant for reading any limitation into this power. If the public interest demands that the exemption should be absolute, the Central Government can do so. Similarly, if the public interest demands that the exemption should be granted only subject to certain conditions it can provide such conditions. Then again if the public interest demands that conditions specified should relate to a stage subsequent to the date of clearance it can do so. The guiding factor is the public interest. 10. The Supreme Court in other cases arising under other Taxation Acts also has laid down that the Government exercise the power of taxation not merely for raising the money but also for regulating/controlling the economy of the country and for achieving the social objectives. In Elel Hotels and Investments Ltd. and Anr. V/s. Union of India. A.I.R. 1990 Supreme Court 1664 -- the Supreme Court while dealing with the Hotel Receipts Tax Act, 1980, has laid down as under: It is now well settled that a very wide latitude is available to the legislature in the matter of classification of objects, persons and things for purposes of taxation. V/s. Union of India. A.I.R. 1990 Supreme Court 1664 -- the Supreme Court while dealing with the Hotel Receipts Tax Act, 1980, has laid down as under: It is now well settled that a very wide latitude is available to the legislature in the matter of classification of objects, persons and things for purposes of taxation. It must needs to be so, having regard to the complexities involved in the formulation of a taxation policy. Taxation is not now a mere source of raising money to defray expenses of Government. It is a recognised Fiscal tool to achieve fiscal and social objectives. In Sri Srinivasa Theatre and Ors. V/s. Government of Tamil Nadu and Ors. -- the Supreme Court in this connection has declared thus: The instrument of taxation is not merely a means to raise revenue in India; it is, and ought to be a means to reduce inequalities.... In the matter of taxation it is, thus, not a question of power but one of constraints of policy the interests of economy, of trade, profession and industry, the justness of the burden, its acceptability and other similar considerations In Subhash Photographies and Ors. V/s. Union of India and Ors. 1993 Supp. (3) Supreme Court Cases 323 JT 1993 (4) SC 116-1993 AIR SCW 2871 the Supreme Court has held as under: Power of taxation is one of the weapons in the Governments armoury to regulate the economy. A certain industry may require encouragement while another may not. Yet another sector may require to be controlled nay, discouraged on some occasions. The same view was reiterated in Union of India and Ors. V/s. Jalyan Udyog and Anr. -- of which it was held as follows: It is equally well settleed by now that the power of taxation can be used not merely for raising revenue but also to regulate the economy, to encourage or discourage as the situation may call for the import and export of certain goods as also for serving the social objectives of the State. Vide Elel Hotels and Investment Ltd. V/s. Union of India -- ; Sriniuasa Theatre V/s. Govt of Tamil Nadu -- and Subhash Photographiec V/s. Union of India (1993) 4 JT. (SC) 116 : 1993 A.I.R. SCW 2871. Vide Elel Hotels and Investment Ltd. V/s. Union of India -- ; Sriniuasa Theatre V/s. Govt of Tamil Nadu -- and Subhash Photographiec V/s. Union of India (1993) 4 JT. (SC) 116 : 1993 A.I.R. SCW 2871. Since the Parliament cannot constantly monitor the needs of and the emerging trends in the economy and is in no position to engage itself in day to day regulation and adjustment of import-export trade accordingly, power is conferred upon the Central Government to provide for exemption from duty of goods, either wholly or partly, and with or without conditions, as may be called for in public interest. 11. As the excise duty is imposed on the production/manufacture of the goods which can be passed on by the producer/manufacturer to the consumers, it is an indirect Tax. The Government exercises its power of Taxation both under direct and indirect Taxation Acts in order to raise the revenue and to regulate the economy. In this connection reference may be made to the case of Sri Sriniuasa Theatre and Ors. V/s. Government of Tamil Nadu and Ors. -- (Supra). Wherein it was laid down as follows: ...Parliament is allowed more freedom of choice in the matter of taxation vis-a-vis other laws. If this be the situation in the case of direct taxes, it should be more so in the case of indirect, since in the case of such taxes the real incidence is upon some than upon the person who actually makes it over to the State though, it is true, he cannot avoid the liability on the ground that he has not passed it on. In the matter of taxation it is, thus, not a question of power of but one of constraints of policy-the interests of economy, of trade, profession and industry, the justness of the burden, its "acceptability and other similar considerations. 12. The Act has two main purposes to achieve, namely, to raise revenue and to regulate economy. Therefore, the Government is entitled to make Rules in exercise of its Rule making power with regard to both or any of those purposes in order to attain fiscal and social objectives. 13. While judging the validity of the subordinate legislation the well settled Rule of the incidental and consequential power had also to be taken note of. In V.T. Khanzode and Ors. V/s. Reserve Bank of India and Anr. 13. While judging the validity of the subordinate legislation the well settled Rule of the incidental and consequential power had also to be taken note of. In V.T. Khanzode and Ors. V/s. Reserve Bank of India and Anr. -- , the Supreme Court in this connection has held as under: The doctrine of ultra vires in relation to the powers of a statutory corporation has to be understood reasonably and so understood, "whatever may fairly be regarded as incidental to or consequential upon, to hose things which the legislature has authorised ought not (unless expressly prohibited) to be held by judicial construction, to be ultra vires." See Attorney General V/s. Great Eastern Ry. Co. (1980) 5 AC 473. In that case power was conferred on the Central Board of Directors of the Reserve Bank to make regulations for the purpose of giving effect to the provisions of the Act. Power to provide for service conditions of the staff was declared by the Supreme Court to be an incidental power. The doctrine of incidental power was again elaborately dealt with in Kharagram Panchayat Samiti and Anr. V/s. State of West Bengal and Ors. -- , wherein the Supreme Court in paragraph No. 5 of the judgment held as follows: This Court in V.T. Khanzode V/s. Reserve Bank of India has followed the dictum of Lord Belborne in Great Eastern Railway case and reaffirmed the principle that the doctrine of ultra vires in relation to the powers of statutory corporation have to be understood reasonably, and so understood, whatever may fairly be regarded as incidental to, or consequential upon, those things which the legislature has authorized ought not (unless expressly prohibited) to be held by judicial construction to be ultra vires. It had earlier been laid down by a Constitution Bench in the case of State of U.P. V/s. Batuk Deo Pati Tripathi that a power to do a thing necessarily carries with it the power to regulate the manner in which the thing may be done. 14. In D.K. Trivedi and sons and Ors. etc. V/s. State of Gujarat and Anr. etc. 14. In D.K. Trivedi and sons and Ors. etc. V/s. State of Gujarat and Anr. etc. A.I.R. 1986 SC 1323, the Supreme Court held that the power to make Rules under the Mines and Minerals (Regulation and Development) Act would include the power to fix the consideration to be paid by the lessee to the lessor in the shape of ordinary rent or surface rent, dead rent and royalty. The relevant extracts, as contained in paragraph No. 40 of the said decision of the Supreme Court are reproduced below: The power to make Rules for regulating the grant of such leases would, therefore, include the power to fix the consideration payable by the lessee to the lessor in the shape of ordinary rent or surface rent, dead rent and royalty. If this were not so, it would lead to the absurd result that when the Government grants a mining lease, it is granted gratis to a person who wants to extract minerals and profit from them. Rules for regulating the grant of mining leases cannot be confined merely to Rules providing for the form in which applications for such leases are to be made, the factors to be taken into account in granting or refusing such applications and other cognate matters. Such Rules must necessarily include provision with respect to the consideration for the grant. Under Sec. 15(1), therefore, the State Governments have the power to make Rules providing for payment of surface rent, dead rent and royalty by the leased to the Government. In the case of Government of India V/s. The dtedal Fine Pharmaceuticals Madras and Ors. -- , it was held that the power to make Rules for assessment and collection of duty includes the power to made Rules to recover the duty which has remained unpaid within reasonable time. 15. The Government, therefore, has the power to make Rules as regard the matters/things expressly or impliedly authorised by the Act. 16. Before proceeding further, reference may be made to Subhash Photographies and Ors. V/s. Union of India and Ors. 1993 Supp. (3) Supreme Court Cases 323 (Supra) : JT 1993 (4) SC 116 : 1993 AIR SCW 2871, wherein the Supreme Court has laid down the best for judging the validity of the subordinate legislation made under a Taxation Act as under: As rightly pointed out by Thommen, J. in Supreme Court Employees Welfare Ass. 1993 Supp. (3) Supreme Court Cases 323 (Supra) : JT 1993 (4) SC 116 : 1993 AIR SCW 2871, wherein the Supreme Court has laid down the best for judging the validity of the subordinate legislation made under a Taxation Act as under: As rightly pointed out by Thommen, J. in Supreme Court Employees Welfare Ass. V/s. Union of India where the validity of a subordinate legislation (whether made directly under the Constitution or Statute) is in question, the Court has to consider the nature, objects and scheme of the instrument as a whole, and on the basis of that examination, it has to what exactly was the area over which and the purposes for which power has been delegated by the governing law". In statutes like Customs Act and Customs Tariff Act one has also to keep in mind that such legislation can be properly administered only by constantly adjusting it to the needs of the situation. This cells for a good amount of discretion to be allowed to the delegate. As is often pointed out flexibility is essential (in law making) and it is one of the advantages of Rules and regulations that they can be altered much more quickly and easily then can acts of Parliament". We have pointed out hereinbefore the necessity of constant and continuous monitoring of the Nations Economy by the Government (and its various institutions) and the relevance of these enactments as a means of ensuring a proper and healthy growth. 17. The excise duty has now become a multi point levy as it is imposed on large number of goods, i.e. raw materials, components, inputs, final products. The multi point levy has the effect of escalating the price of the goods adversely effecting the economy of the country. Clauses (xvia) and (xvib) were inserted in Sub-section (2) of Sec. 37 of the Act in the year 1986 by the Parliament giving power to the Government to make Rules containing MODVAT Credit Scheme. The Government in 186 framed two sets of Rules containing the MODVAT Credit Schemes, one under Clause (xvia) and other under Clause (xvib)., The former contains the MODVAT Credit Scheme for inputs and the later contains the MODVAT Credit Scheme in respect of certain raw materials used in the manufacture of certain excisable goods. The Government in 186 framed two sets of Rules containing the MODVAT Credit Schemes, one under Clause (xvia) and other under Clause (xvib)., The former contains the MODVAT Credit Scheme for inputs and the later contains the MODVAT Credit Scheme in respect of certain raw materials used in the manufacture of certain excisable goods. The object of these scheme is to check and reduce the adverse effect of multi point duty. 18. Under the Scheme the duty paid on inputs, which are brought into the factory for their use in manufacture, of the final products, is permitted to be utilised towards payment of the duty on the final products. The Government thus looses the revenue to the extent the duty paid on the inputs is allowed to be utilised towards payment of duty on final product because but for the Scheme it could have charged the duty on the final product according to their value/price without giving credit of duty paid on the inputs. But the Government has framed the Scheme in order to reduce the adverse effect of the multi point duty. The Government under the Scheme has voluntarily accepted the loss of revenue in order to achieve the fiscal and social objectives. Therefore, the Scheme is within the Rule making power of the Government and no exception can be taken to it. 19. As mentioned before the power to make Rules with regard to matters expressly authorised includes the power to make Rules with regard to the matters which are incidential thereto. Therefore, when the Government has the power to frame Rules to confer certain benefit it has also the incidental power to regulate its use and prevent its misuse. Rules 57A to 57E and 57G have laid down the procedure and the steps which are required to be taken for availing of the benefit under the Scheme. Rule 57F(1)(ii) has been enacted in order to prevent the misuse of the benefit by the manufacturer who has taken credit of the duty paid on inputs. The said provision and the fiction contained therein is within the incidental power of the Government. 20. In Union of India V/s. Paliwal Electricals (P) Ltd and Anr. -- . Rule 57F(1)(ii) has been enacted in order to prevent the misuse of the benefit by the manufacturer who has taken credit of the duty paid on inputs. The said provision and the fiction contained therein is within the incidental power of the Government. 20. In Union of India V/s. Paliwal Electricals (P) Ltd and Anr. -- . While dealing with the exemption notification issued by the Government under the Act, the Supreme Court held that it must be presumed that the amendment in exemption notification "was found by the Central Government to be necessary for giving effect to its policy (underling the notification) on the basis of the working of the said notification and that such an amendment was found necessary to prevent persons from taking unfair advantage of the concession. (emphasis supplied). 21. The Government was. therefore, well within the right to frame such a Rule as is contained in Rules 57F(1)(ii) in order to prevent the misuse of the benefit conferred on the manufacturer by the Scheme. 22. That apart the impugned Rule cannot be read in isolation. It is a part of the Scheme under which certain benefit has been given to the manufacturer. If he wants the benefit, he cannot avoid the conditions subject to which such benefit can be availed of, He is equally bound by those provisions in the Scheme which have been made in order to prevent the misuse of the benefits. It is not open to him to say that he will accept the benefit under the scheme but will ignore its regulatory provisions. He has either to accept the scheme as a whole or reject it altogether. Choice is his. 23. It is true that the impugned Rule contains a fiction, but a fiction can be created by the Rule making authority also. In Union of India and Ors. V/s. Jalyan Udvog and Anr. (Supra) the exemption notification issued under the Customs Act has exempted the ocean going vessels other than the vessels imported to be broken up from payment of customs duty, but by the proviso appended thereto vessel subsequently broken up was made chargeable to duty which would be payable on her as if it was then imported to be broken up. (Supra) the exemption notification issued under the Customs Act has exempted the ocean going vessels other than the vessels imported to be broken up from payment of customs duty, but by the proviso appended thereto vessel subsequently broken up was made chargeable to duty which would be payable on her as if it was then imported to be broken up. The said proviso contained a fiction and the Supreme Court upheld it holding as below: We are equally unable to agree that a legal fiction can be created only by legislature and not by the executive. 24. In J.K. Cotton Spinning and Weaving Mills Ltd, and Anr. v Union of India and Ors. A.I.R. 1988 S.C. 191, the Supreme Court upheld the validity of Rules 9 and 49 of the Central Excise Rules which created fiction providing for deemed removal of the excisable goods produced at an intermediate stage of an integrated process of manufacture. 25. The submission of the Learned Counsel that a fiction cannot be created by a Rule making authority is, therefore, devoid of merit and is. accordingly rejected. 26. The Learned Counsel for the petitioner has cited several authorities in order to show that the excise duty is levied on production/manufacture of the excisable goods and it is not a tax on their sale. There cannot be a dispute about it. That is the settled position. It is, therefore, not necessary to refer all those cases, which have been cited by the Learned Counsel. But the impugned Rule does not impose a tax on the sale of the goods. In fact, strictly speaking, it is not a tax at all. The essential feature of all taxes is that they are compulsory in nature. A levy cannot be called tax unless it is a compulsory exaction. The impugned Rule does not compel any manufacturer to pay the duty in accordance with the principles contained therein. A manufacturer, who does not want the benefit under the scheme, is not required to take notice of the said Rule. Even if a manufacturer wants to take advantage of the benefit conferred by the scheme, there is no obligation on him to pay the duty in accordance with the fiction contained in the impugned Rule. A manufacturer, who does not want the benefit under the scheme, is not required to take notice of the said Rule. Even if a manufacturer wants to take advantage of the benefit conferred by the scheme, there is no obligation on him to pay the duty in accordance with the fiction contained in the impugned Rule. The impugned Rule is merely a regulatory measure, enacted in order to compel the manufacturer to use the inputs brought into the factory under the scheme in manufacture of the final product only. Such a Rule is within the incidental power of the Government. 27. In this connection reference may be made to the two decisions in. Pokhardas Meghraj V/s. The State of Bombay and Anr. 1957 S.T.C. 758 (Bombay) and Babulal V/s. D.P. Dubey and Ors. 1955 S.T.C.255 (Nagpur). on which reliance has been placed by the Learned Counsel for the petitioner. In the former case, the High Court declared certain provisions of Bombay Sales Tax Rules, 1952 as ultra vires on the ground that they purport to include the purchase price in the taxable turnover of the purchasing dealer, which was inconsistent with the provisions of the Sales Tax Act, In the later case, the Nagpur High Court held that it is not open to the Rule making authority to alter the incidence of tax from the seller to the purchaser. But the position in the instant case is different and the principles laid down in the above two cases are not attracted to it. Here a compact scheme in order to confer the benefit on the manufacturer has been framed under the Rule making over. The scheme contains regulatory measure so as to compel the manufacturer to utilise the inputs brought into the factory under the scheme in manufacture of final product only. If the manufacturer wants a benefit under the. Scheme he is also bound by its regulatory provisions. 28. Before parting with the case it may be observed that the impugned Rule 57F(1)(ii) has been amended in 1955 deleting the fiction which is under challenge in the present case, but on the ground that the unamended Rule cannot be declared as ultra vires. 29. It is for the Government to decide as to what measure should be adopted to attain the fiscal and social objectives. 29. It is for the Government to decide as to what measure should be adopted to attain the fiscal and social objectives. If the Government in order to attain those objectives amend the Rules deleting the regulatory provision no exception can be taken to it. The Government amended the said Rule not because the unamended Rule was ultra vires but because it found the amendment in the interest of the economy. 30. For the reasons given above, this writ petition is dismissed, No cost.