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2003 (3) TMI 135
Issues:
Challenge to the legality of a customs notification providing a concessional rate of duty on imported jumbo rolls of photographic color paper. Requirement of industrial license under the Industries (Development and Regulation) Act, 1951 for availing the benefit of the notification. Petitioner's failure to obtain the necessary license within the stipulated period. Claim of unreasonableness and lack of public interest in the conditions of the notification.
Analysis:
The petitioners, a Partnership Firm registered under the Partnership Act, 1932, challenged the legality of a customs notification (No. 216/88) providing a concessional rate of duty on imported jumbo rolls of photographic color paper. The notification mandated importers to hold an industrial license under the Industries (Development and Regulation) Act, 1951, for slitting and confectioning activities. The petitioners, being a Small Scale Industrial Unit, did not possess the required license. They imported jumbo rolls for their laboratory use but did not have the facility for slitting and confectioning, which was outsourced to another entity.
The Ministry of Industries, Government of India, issued a Press Note in 1986, emphasizing the need for industrial undertakings, including small scale units, to obtain an industrial license for specific activities involving jumbo rolls. The petitioners failed to apply for the required license within the stipulated period, despite the opportunity provided. The court noted that the petitioners did not qualify for the concessional rate of duty due to their non-compliance with the licensing requirement.
In response to the petition, the respondents justified the notification by highlighting the misuse of imported jumbo rolls by small and medium scale units, leading to poor quality production in the market. The government's decision to mandate industrial licenses aimed to ensure specialized technical know-how in the conversion process. The court upheld the government's policy rationale behind the notification and emphasized the importance of compliance with licensing requirements for availing duty exemptions.
The court rejected the petitioner's argument of unreasonableness in the notification's conditions, emphasizing the intelligible classification between importers with and without industrial licenses. The court cited a Supreme Court precedent stating that exemption notifications do not create enforceable promises. Ultimately, the court dismissed the petition, finding no merit in the petitioner's challenge to the notification's validity or conditions, and declined to exercise writ jurisdiction in favor of the petitioners.
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2003 (3) TMI 134
The High Court of M.P. at Jabalpur dismissed the writ petition filed by the petitioner challenging the dismissal of their appeal by CEGAT for non-compliance with Section 35 of the Central Excise Act, 1944. The petitioner was advised to file an appropriate application before CEGAT to address non-appearance and non-compliance issues. The court found no grounds for interference and dismissed the writ petition.
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2003 (3) TMI 133
Issues:
Whether additional duty of customs is leviable on acrylic sheets imported by the Petitioners under Notification No. 53/88-C.E., dated 1st March, 1988.
Analysis:
The petitions raised the issue of the liability of additional duty on imported acrylic sheets under Notification No. 53/88-C.E., dated 1st March, 1988. The Petitioners argued that since acrylic sheets were manufactured from plastic scraps, which were wholly exempt from excise duty under the Notification, no additional duty should be levied. They relied on various court decisions to support their contention that fulfilling the basic requirement of the Notification, i.e., manufacturing acrylic sheets from plastic scrap, should suffice for claiming exemption from additional duty.
Customs Authorities' Contention:
On the other hand, the Revenue contended that the exemption under the Notification required the payment of excise duty or additional duty on the plastic scrap used in manufacturing acrylic sheets. Since no such duty was paid on the plastic scrap in this case, the Petitioners were not entitled to the benefit of the Notification. They relied on a court decision that stated if the conditions specified in a Notification were not met, the importer could not claim the benefit of that Notification.
Court's Decision:
After hearing both parties, the Court concluded that the issue was covered by a previous judgment, which stated that the payment of excise duty or additional duty on inputs, in this case, plastic scraps, was a condition precedent for availing the benefit of the Notification. Since the conditions were not fulfilled in this case, the Petitioners could not claim exemption from additional duty. The Court distinguished other court decisions cited by the Petitioners, stating they were not applicable to the facts of this case. Therefore, the Petitioners were directed to pay the quantified additional duty within a specified timeframe with interest.
Conclusion:
Ultimately, the petitions were disposed of with the direction for the Petitioners to pay the determined additional duty within the stipulated period. No costs were awarded in the case.
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2003 (3) TMI 132
Issues:
Modification of a previous order under Customs Act, 1962 based on non-disclosure of facts in a writ petition leading to an interim order.
Analysis:
The judgment concerns an application seeking modification of an order dated 7th February, 2003, which stayed an earlier order releasing impugned currency to the respondent under the Customs Act, 1962. The applicant argued that they were not given notice of the revision filed against the Commissioner of Customs (Appeals) order, leading to the release of the currency on payment of fines. It was revealed that the respondent had filed a Writ Petition seeking direction for the release of the currency, which was granted an interim order on 11th December, 2002. The petitioner filed the present application on 28th January, 2003, concealing the fact of the pending Writ Petition, which was considered deliberate non-disclosure by the Court.
The Court emphasized the importance of full disclosure in legal proceedings, citing the Supreme Court's stance on the principle of "finality of litigation" and the necessity for litigants to approach the court with clean hands. The Court held that obtaining orders through fraud or concealment of material facts is impermissible and constitutes an abuse of the legal process. The petitioner's deliberate suppression of the respondent's prior Writ Petition and the interim order obtained therein was deemed as an abuse of process, leading to the recall of the interim order issued on 7th February, 2003.
The judgment underscores that suppression of material facts is sufficient grounds to deny discretionary relief in legal matters. Parties are obligated to disclose all relevant facts that could impact the case's outcome, and failure to do so amounts to an abuse of the court's process. The Court concluded that the petitioner's intentional concealment of the respondent's prior legal actions warranted the recall of the interim order. Consequently, the application was allowed, and the interim order issued on 7th February, 2003, was revoked. The case was listed for further hearing on 15th July, 2003.
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2003 (3) TMI 131
Issues Involved:
1. Validity of Rule 3 of the Induction Furnace Annual Capacity Determination Rules.
2. Quashing of the order dated 30-9-1997 and letter dated 11-3-1998.
3. Re-determination of the annual capacity of production considering the power factor.
Issue-wise Detailed Analysis:
1. Validity of Rule 3 of the Induction Furnace Annual Capacity Determination Rules:
The petitioner, a steel industry, challenged Rule 3 of the Induction Furnace Annual Capacity Determination Rules as being unreasonable and arbitrary. The petitioner argued that the rule violated Section 3A of the Central Excise Act, which allows the Central Government to charge excise duty based on the capacity of production. The petitioner contended that the rule failed to consider the power factor, which is crucial for determining the production capacity of the furnace. The court noted that Section 3A(2) provides for the determination of annual capacity by considering relevant factors, including power. The court held that power is a vital factor in determining the capacity and that the rule should be interpreted to include power as a relevant factor. Instead of striking down the rule, the court decided to read it down to include the power factor, ensuring a fair determination of the annual capacity.
2. Quashing of the order dated 30-9-1997 and letter dated 11-3-1998:
The petitioner sought to quash the order dated 30-9-1997, which determined the annual capacity of production at 16,000 MTs, and the letter dated 11-3-1998, which rejected the petitioner's claim based on the power factor. The petitioner argued that the determination was factually incorrect and not based on the actual capacity of the furnace. The court observed that the respondents had determined the capacity based on available documents indicating the capacity of the furnace/crucibles, as per the notification dated 25-7-1997. However, the court found that the respondents expressed helplessness due to the absence of a provision to consider the power factor. The court held that the power factor plays a vital role in determining the annual capacity and directed the respondents to re-determine the capacity by considering the power factor.
3. Re-determination of the annual capacity of production considering the power factor:
The petitioner argued that the actual capacity of the crucible based on the furnace power pack would be 3.600 MT, and the power factor should be considered in determining the annual capacity. The court noted that the petitioner had provided sufficient material to support the relevance of the power factor. The court held that there is no prohibition under the rules for considering the power factor and that it should be included in the determination process. The court directed the respondents to re-determine the actual capacity by considering the power factor and allowed the petitioner to produce additional material within four weeks. The court set aside the previous determination and provided a timeline of eight weeks for compliance with the order.
Conclusion:
The court allowed the writ petition, set aside the order dated 30-9-1997, and directed the respondents to re-determine the annual capacity by considering the power factor. The court emphasized the importance of including the power factor in the determination process to achieve a fair and reasonable assessment of the production capacity. The court's decision ensures that the determination of the annual capacity aligns with the provisions of Section 3A of the Central Excise Act and the relevant rules.
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2003 (3) TMI 130
Issues Involved:
1. Legality of the prosecution of Customs Officers without sanction under Section 197 of Cr.P.C. and Section 155 of the Customs Act.
2. Validity of the complaints of ill-treatment and assault by Customs Officers.
3. Maintainability of the petition filed by the Union of India.
Detailed Analysis:
1. Legality of the prosecution of Customs Officers without sanction under Section 197 of Cr.P.C. and Section 155 of the Customs Act:
The petitioners, Customs Officers, argued that they were public servants acting in the discharge of their official duties and thus required sanction from the Central Government for prosecution under Section 197 of Cr.P.C. and Section 155 of the Customs Act. The court noted that the Customs Officers were indeed public servants and their actions, including the alleged assault during interrogation, were connected to their official duties. The court emphasized that there must be a reasonable connection between the act and the official duty, and even if the act exceeds what is necessary for discharge of the duty, the protection under Section 197 applies. The court concluded that the prosecution without the necessary sanction was not maintainable.
2. Validity of the complaints of ill-treatment and assault by Customs Officers:
The respondents alleged severe ill-treatment and assault by the Customs Officers, claiming that their statements were recorded under coercion. However, the court found that the learned Magistrate did not find any fresh injuries on the respondents' bodies during their initial examination, noting only old injury marks. The injuries noted by the Jail Doctor three days later could not be conclusively linked to the alleged assault by the Customs Officers. The court observed that the complaints of ill-treatment appeared to be false and concocted, aimed at retracting the confessional statements and obstructing the prosecution for smuggling activities. The court held that the complaints were not credible and should have been dismissed at the threshold.
3. Maintainability of the petition filed by the Union of India:
The respondents contested the maintainability of the petition filed by the Union of India, arguing that it had no locus standi as it was not an aggrieved party. The court, however, found that the Union of India had a legitimate interest in protecting its officers from vexatious prosecutions and ensuring that the requirement of sanction was not bypassed. The court held that the Union of India was competent to file the petition, as it was responsible for granting or refusing sanction for prosecution. The court rejected the argument that the Union of India should not be involved in the petition, affirming its role in protecting its officers from harassment by unscrupulous elements.
Conclusion:
The court allowed the petitions, quashing the order of the learned Sessions Judge that rejected the discharge applications of the Customs Officers. The court discharged the petitioners from the Sessions Case, emphasizing the need for sanction before prosecuting public servants for acts connected to their official duties. The court highlighted the importance of protecting honest officers from false and malicious complaints, ensuring the integrity and morale of law enforcement agencies.
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2003 (3) TMI 129
Issues Involved:
1. Constitutionality of Rule 5 of the Hot Re-rolling Steel Mills Annual Capacity Determination (Amendment) Rules, 1997.
2. Violation of Article 14 of the Constitution.
3. Consistency with Section 3A of the Central Excise Act, 1944.
Issue-wise Detailed Analysis:
1. Constitutionality of Rule 5 of the Hot Re-rolling Steel Mills Annual Capacity Determination (Amendment) Rules, 1997:
The petitioners challenged Rule 5 as ultra vires, unconstitutional, and contrary to Section 3A of the Central Excise Act. They argued that Rule 5 deviates from the mandatory formula prescribed in Rule 3 for determining the annual production capacity and introduces a deeming provision based on the financial year 1996-97, which is irrelevant and alters the basic concept of the Act. The respondents contended that Rule 5 is valid, within the statutory provisions, and not ultra vires. The court, referencing the Supreme Court's decision in Commissioner of Central Excise and Customs v. Venus Castings (P) Ltd., held that Rule 5 is constitutionally valid and does not run counter to Section 3A. The court emphasized that Section 3A allows the Central Government to charge excise duty based on production capacity, and Rule 5 is a statutory fiction within the Parliament's competence.
2. Violation of Article 14 of the Constitution:
The petitioners argued that Rule 5 creates discrimination among similarly placed steel mills, violating Article 14 by introducing unreasonable classification. The respondents countered that fiscal legislation allows for classification, and courts typically do not interfere if the classification is justified. The court cited the Supreme Court's decision in State of Maharashtra v. Madhukar Balkrishna Badia, which allows for wide discretion in classification for taxation purposes. The court found that Rule 5 does not violate Article 14, as it provides a specific rule for a particular industry and does not introduce discriminatory treatment.
3. Consistency with Section 3A of the Central Excise Act, 1944:
The petitioners contended that Rule 5 contradicts Section 3A, which prescribes excise duty based on annual production capacity, whereas Rule 5 bases it on the actual production during 1996-97. The court, referencing Supreme Court decisions, held that Section 3A enables excise duty based on production capacity, and Rule 5 aligns with this by addressing large-scale evasion in the steel re-rolling industry. The court concluded that Rule 5 does not run counter to Section 3A or any other provisions of the Act.
Conclusion:
The court dismissed all writ petitions, holding that Rule 5 is constitutionally valid, does not violate Article 14, and is consistent with Section 3A of the Central Excise Act. The court emphasized the legislative competence in enacting such rules and the necessity of addressing tax evasion in specific industries.
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2003 (3) TMI 128
Issues:
Determining the point of liability for excise duty payment when transporting raw materials for explosives manufacturing to the mine site or after manufacturing at the mine site.
Analysis:
The petitioners, public limited companies dealing with industrial explosives, raised the issue of excise duty payment timing. They argued that under the bulk explosive system, manufacturing occurs at the mine site, not at the support plant. The process involves transporting raw materials in pump trucks to the mine site for on-site production. The petitioners emphasized that the point of manufacture, and thus excise duty liability, should be at the mine site, not when the pump truck leaves the support plant.
The respondents contended that excise duty should be paid when goods are removed from the factory premises, not at the mine site. They highlighted the prescribed procedures under Central Excise Rules for recording production, paying duty, and clearing goods before removal from the factory. The respondents accused the petitioners of bypassing duty payment by claiming to pay only after goods are consumed at the mine site, leading to revenue loss and security risks.
The petitioners' counsel argued for a uniform taxing procedure across states, citing a circular allowing flexibility in duty payment for certain goods. The respondents' counsel supported the current assessment method but suggested the petitioners approach the Central Board of Excise and Customs for any representation under Section 37B of the Central Excise Act, 1944.
The judgment directed the petitioners to submit representations to the Central Board of Excise and Customs for uniformity in excise duty assessment. The court refrained from expressing an opinion on the case's merits, maintaining status quo on duty recovery during the representation process. The writ petitions were disposed of without costs, with any deposited security to be refunded to the petitioners.
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2003 (3) TMI 127
The High Court of Punjab and Haryana ruled in favor of a manufacturer of alloy and non-alloy steel wire, allowing them to claim Modvat credit for inputs used in manufacturing tyre bead wire. The Department's denial of the credit was overturned, as tyre bead wire was not exempt from excise duty. The Court dismissed the Department's appeal, stating no question of law arose from the case.
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2003 (3) TMI 126
Issues involved: Challenge to order seeking to confiscate imported goods under Section 125 of the Customs Act, 1962.
Summary:
The petitioners, engaged in manufacturing containers, imported tin sheets under a contract for prime quality tin plate. However, upon examination, it was found that the imported goods were Tin Plate Waste instead of Tin Plate Prime as declared. The petitioners, unaware of the discrepancy, sought to place the goods in a Bonded Warehouse and paid provisional customs duty. The Collector of Customs held that the goods were mis-described and liable for confiscation under Section 111(d) of the Act, offering an option to redeem on payment of a fine. The petitioners challenged this order, contending they were innocent victims of fraud by the foreign supplier. The High Court noted the absence of mala fide intent on the part of the petitioners and their proactive steps upon discovering the fraud. It was observed that the petitioners had paid for Tin Plate Prime and customs duty accordingly, justifying clearance of the goods. The Court held that confiscation was unjustified, quashing the order and directing return of bank guarantees.
The Court emphasized that the petitioners were not party to the fraud, having paid for Tin Plate Prime but receiving Tin Plate Waste due to the foreign supplier's deception. Despite the discrepancy in goods imported and declared, the petitioners acted in good faith and suffered financial losses. Notably, the rate of customs duty for Tin Plate Prime was higher, further supporting the petitioners' innocence. The Court found no violation of Customs Act provisions by the petitioners and deemed the confiscation unwarranted. Consequently, the order was set aside, and bank guarantees were to be returned to the petitioners.
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2003 (3) TMI 125
Issues:
Challenge to the validity of Rule 7 under the Customs Tariff Act, 1975 and the Rules framed thereunder, specifically related to confidentiality of information and the opportunity of personal hearing provided to the concerned parties.
Analysis:
The judgment addressed multiple writ petitions seeking to quash preliminary findings and challenge the legality of Rule 7 under the Customs Tariff Act, 1975. The petitions raised concerns regarding the import of flat glass from countries like Indonesia and China. The petitioners alleged a lack of opportunity for personal hearing and requested detailed information withheld under the confidentiality rule. The key contentions focused on the validity of Rule 7 and compliance with principles of natural justice, emphasizing the discretionary power granted to the Designated Authority under the rule.
The validity of Rule 7 was challenged on the grounds of providing absolute discretion to withhold information based on confidentiality claims, leading to incomplete responses from exporters and importers. Previous judgments had upheld the validity of Rule 7, emphasizing the authority's expertise and corrective measures through appellate review. The petitioners sought a reconsideration of Rule 7's validity, arguing that the issue was pending before a Division Bench. The judgment highlighted the binding nature of precedent decisions and the administrative-legislative nature of the Designated Authority's role in anti-dumping investigations.
The judgment further analyzed the application of natural justice principles in the context of the Customs Tariff Act and its Rules. It clarified that while natural justice principles should generally apply, specific rule provisions dictated the extent of compliance required. The Designated Authority's discretion in allowing oral presentations was subject to subsequent written reproduction, ensuring fair consideration of information. The judgment emphasized that the absence of oral hearings did not prevent parties from submitting relevant information in writing.
Additionally, the judgment addressed the non-pressing of certain contentions during the hearing, emphasizing the limited scope of judicial review in writs of Certiorari. The Designated Authority's conclusions were deemed recommendatory, subject to revision during the final decision-making process. The judgment concluded by dismissing the writ petitions, citing lack of merit in the challenges raised and highlighting the refund provisions for collected duties in case of non-imposition.
In summary, the judgment provided a detailed analysis of the challenges to Rule 7's validity, the application of natural justice principles, and the limited scope of judicial review in administrative decisions under the Customs Tariff Act, ultimately dismissing the writ petitions.
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2003 (3) TMI 124
Whether if the Deputy Chief Controller of Imports and Exports had not been examined as a witness, the procedure prescribed by Section 200 Cr.P.C. had not been followed and, therefore, the order passed by the Magistrate taking cognizance of the offences was illegal?
Held that:- It difficult to comprehend the aforesaid reasoning of the High Court. Section 6 of the Imports and Exports (Control) Act provides that no Court shall take cognizance of any offence punishable under Section 5 except upon a complaint in writing made by an officer authorised in this behalf by the Central Government by a general or a special order. That the Deputy Chief Controller of Imports and Exports had been so authorised by the Central Government is not in dispute. Proviso (a) to Section 200 Cr.P.C. lays down that if a public servant acting or purporting to act in the discharge of his official duties has made the complaint in writing, the Magistrate need not to examine the complainant and the witnesses. In view of Twelfth clause of Section 21 IPC which provides that every person in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty by the Government shall be a public servant, the Deputy Chief Controller of Imports and Exports is a public servant. It is also not the case of the accused-respondents that the Deputy Chief Controller of Imports and Exports is not a public servant. The complaint was filed by him in discharge of his official duty. The learned Magistrate was, therefore, fully justified in taking cognizance of the offences without recording the statement of the complainant. The view taken by the High Court is wholly unsustainable in law and must be set aside.
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2003 (3) TMI 123
Manufacture - whether the wire of the thinner gauge is excisable to duty - Held that:- Court was also taken through the processes, which are undergone by the manufacturer and which have been set out in some of the orders passed by the Commissioner. It was submitted that the raw material is a rod falling under tariff item 72.13 and/or 72.15 whereas after the process a distinct and separate marketable product falling under tariff item 72.17 has come into existence. It was submitted that the market price of both the products is also different inasmuch as the cost of the raw material was approximately Rs. 13,000/- per metric ton whereas for the final product the market price was approximately Rs. 15,000/- per metric ton. It was submitted that under these circumstances, the Court must now hold that the earlier decisions of the Tribunal are not correct and that the final product i.e. the Wire which is drawn by the cold drawing process is an excisable product.
It is to be seen that the initial product was a wire rod. The ultimately product is also a wire. All that is done is that the gauge of the rod is made thinner and the product is finished a little better. In our view the earlier decisions of the Tribunal are correct. There is no manufacture of a new product. Merely because there are two separate entries does not mean that the product becomes excisable. The product becomes excisable only if there is manufacture - Decided against Revenue.
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2003 (3) TMI 122
Issues Involved:
1. Maintainability of the writ application in view of the alternative remedy under Section 130A of the Customs Act.
2. Legality of the redemption fine and personal penalty imposed by the Commissioner of Customs.
3. Confiscation of 11.5 MT of lithophone, a non-prohibited good.
4. Alleged violation of principles of natural justice by the Customs Authority.
Issue-wise Detailed Analysis:
1. Maintainability of the Writ Application:
The Court addressed whether the writ application could be entertained despite the existence of an alternative remedy under Section 130A of the Customs Act. The Court noted that the existence of an alternative remedy is not an absolute bar to entertaining a writ application, particularly when it is alleged that the order impugned is contrary to a law declared by the Supreme Court or violates principles of natural justice. The Court found that the petitioners' allegations warranted investigation in a writ application, thus overruling the preliminary objection.
2. Legality of the Redemption Fine and Personal Penalty:
The petitioners argued that the Supreme Court's decision in Siemens Limited v. Collector of Customs precluded the imposition of redemption fines and penalties when goods are ordered to be re-exported. The Court distinguished the present case from Siemens, noting that in Siemens, the Customs Authority provided an option to re-export without payment of duty, whereas in the present case, re-export was permitted only after payment of redemption fine. The Court concluded that the decision in Siemens did not apply to cases where re-export is conditional upon payment of redemption fine, thereby upholding the majority decision of the Tribunal.
3. Confiscation of 11.5 MT of Lithophone:
The petitioners contended that 11.5 MT of lithophone, being non-prohibited goods, should not have been confiscated. The Court held that under Section 111(m) of the Customs Act, the Customs Authority can confiscate the entire consignment if there is a mis-description of goods, regardless of whether the goods are prohibited. The Court found that there was a definite mis-description in the bill of entry, justifying the confiscation of the entire consignment, including the lithophone.
4. Alleged Violation of Principles of Natural Justice:
The petitioners argued that the Customs Authority acted against the principles of natural justice by relying on undisclosed documents to conclude collusion between the petitioners and the foreign manufacturer. The Court noted that the initial burden was on the petitioners to prove that the mis-sent goods were a bona fide mistake by the foreign supplier. The Customs Authority was not required to disclose their materials unless the petitioners provided sufficient evidence to contradict the findings. The Court found the Customs Authority's findings of mala fide intention reasonable and not perverse, thus rejecting the petitioners' contention.
Conclusion:
The Court dismissed the writ application, finding no merit in the petitioners' arguments. The decision of the Customs Authority and the majority decision of the Tribunal were upheld, and the redemption fine and personal penalties imposed were deemed lawful. The confiscation of the entire consignment, including the non-prohibited lithophone, was justified due to the mis-description of goods. The Court also found no violation of principles of natural justice in the Customs Authority's proceedings. No order as to costs was made.
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2003 (3) TMI 121
Interpretation of Rule 57F(17) of the Central Excise Rules, 1944,
Held that:- Sub-rule 17(b) is identical to sub-rule 17(a) except that it is in respect of a different final product. Once a validity of a provision is challenged and the validity is upheld by reading down that provision, then it is not necessary that in all subsequent proceedings the validity must again be challenged. It is sufficient if a party claims that the provision has to be read in the manner laid down by a judgment of this Court. In the light of the judgment of this Court in Eicher Motors case (1999 (1) TMI 34 - SUPREME COURT OF INDIA), sub-rule 17 cannot apply to vested rights. Therefore to the extent that the goods have already been exported, prior to March, 1997, the assessee would be entitled to a refund.
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2003 (3) TMI 120
Issues involved:
The issue involves the refund of a pre-deposit amount made by the petitioner before the Tribunal under the Central Excise Act.
Summary:
Issue 1: Refund of pre-deposit amount
The petitioner, a manufacturer of instant coffee powder, filed an appeal challenging the rejection of certain deductions by the Appellate Authority. The Tribunal remanded the case for re-determination, resulting in a differential duty payable by the petitioner. The petitioner sought a refund of the balance sum of Rs. 77,10,277.00, being the difference between the pre-deposit and the demand. The respondent insisted on a regular refund claim under Section 11B of the Central Excise Act, contending that the pre-deposit is akin to excise duty. The petitioner argued that the pre-deposit is not excise duty and cited relevant judgments. The High Court held that the pre-deposit amount is not equated to excise duty and ordered the refund along with 15% interest, citing precedents and a circular from the Department. The High Court set aside the respondent's endorsement and directed the refund with interest.
Issue 2: Imposition of costs
The High Court imposed costs of Rs. 10,000.00 on the respondent for unnecessarily withholding the refund amount despite a reasonable request from the petitioner. The court expressed displeasure at the respondent's stance, which contradicted previous court rulings and confirmed by the Supreme Court. The High Court directed the respondent to pay the costs to the Chief Ministers' Relief Fund within four weeks.
Issue 3: Observations and directions
The High Court made observations on the delay in processing the refund application since 2000 and criticized the respondent for persisting with an unsustainable argument despite clear court rulings. The court deprecated the filing of misleading affidavits and directed the Chief Commissioner to conduct an inquiry into the matter and take appropriate action against the officials responsible. The writ petition was allowed with the above directions and costs of Rs. 10,000.00 imposed on the respondent.
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2003 (3) TMI 119
The Supreme Court of India disposed of the appeal as infructuous as the provisional assessments were finalized by the Excise authorities and the appeal to the Commissioner (Appeals) was also disposed of. The court did not express any opinion on the raised question of law.
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2003 (3) TMI 118
The Supreme Court set aside the Tribunal's decision due to a delay in appeal and remitted the case back to the Commissioner (Appeals) for a hearing on merits. No costs were awarded. (Case citation: 2003 (3) TMI 118 - SC)
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2003 (3) TMI 117
Whether the respondents are entitled to the benefit of Kar Vivad Samadhan Scheme, 1998 (in short "KVSS")?
Held that:- As held by the High Court the letter dated 26-7-1995 "tantamounted to a show cause notice" or was "in the nature of a show cause notice" then there would have been no requirement or need to issue further show cause notices. Pending adjudication, under those show cause notices, the respondents decided to comply with the direction given in the letter of 26-7-1995 and provisionally paid and/or gave bonds/executed bank guarantees. However, for the period 1-9-1995 to 31-1-1998, no show cause notice had been issued till 16th March, 1999. Thus, it is clear that the High Court fell in error in holding that the letter dated 26-7-1995 "tantamounts to a show cause notice" or "was in the nature of a show cause notice". In favour of assessee.
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2003 (3) TMI 116
Whether purchaser who claims refund under Section 11B must do so within six months of the date of purchase of the goods?
Held that:- Section 11B was amended in 1991. After the amendment by virtue of sub-clause (a) in Explanation "B" of Section 11B even a purchaser can claim refund. A manufacturer has to file his claim for refund within six months from the relevant date. The purchaser also has to file a claim for refund within six months from the date of purchase of the goods.
As before refund can be claimed either by the manufacturer or by the purchaser, the conditions of Section 11B must be fulfilled viz., it must be shown that the amount of duty of excise in relation to which such refund is claimed was "collected from or paid" by the person claiming refund and that the incidence of such duty has not been passed on by him to any other person. Therefore, even in a claim for refund by the purchaser, he would have to satisfy the Department that these conditions are fulfilled before any refund can be made to him.
In this view of the matter, we remit the matter back to the appropriate authority for consideration in the light of the law laid down herein.
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9911796707
