TMI Blog2014 (11) TMI 616X X X X Extracts X X X X X X X X Extracts X X X X ..... a, Ministry of Commerce Industry (Department of Industrial Policy Promotion) issued an Office Memorandum on 7th January, 2003 in lieu of New Industrial Policy and other concessions for the State of Uttaranchal (Now State of Uttarakhand) and State of Himachal Pradesh to work out 'Tax and Central Excise concessions to attract investments in the industrial sector for the Special Category States, including Uttarakhand. The industries eligible for such incentives would have to be environment friendly with potential for local employment generation and use of local resources'. The core issue of the announcement related to Ministries/ agencies on the issue inter-alia, infrastructure, development, financial concessions and to provide easy market access. The new initiatives were to provide the required incentives as well as an enabling environment for industrial development, improve availability of capital and increase market access to provide a fillip to the private investment in the state. 2. Accordingly, it has been decided to provide the package of incentives for these States. In Clause 3.1 (a), (b) it has been set out as under:- Clause 3.1 (a) 100% (hundred percent) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Excise, as specified in the implementing notification. It is submitted that the impugned notice is based upon the law lay down by Himachal Pradesh High Court in 'Indo Farm Tractors and Motors vs. Union of India' and it also relies on two decisions of Tribunal, inter-alia, to the effect that the absence of inclusion of NCCD under the concerned notification, would mean that NCCD was not exempt thereunder. 6. It is then asserted that so far the question of filing writ petition, against the show cause notice dated 26th August, 2011 is concerned, there are exceptions firstly, where it is manifest that the show cause notice proceeds on an apparent misconstruction of the statute, secondly, where the show cause notice reveals that the minds of the respondents are made up and showing cause in such circumstances would be a futile exercise and thirdly, where the notice itself is issued after undue delay the settled principles is that same is barred by limitations as in the case in hand. In this context, the petitioner relied upon the judgments of Hon'ble Supreme Court, rendered in 'Calcutta Discount Company Ltd. v. Income Tax Officer, Companies District, I and another' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 2004. In Gammon India Limited's case (supra), since it involved the issuance of SCN, after two years of completion of enquiry, whereas in the case in hand, as per the show cause notice, the delay was from petitioner side, as the officers of the Central Excise, Rudrapur Range, Pant Nagar tried to investigate the matter, but the petitioner/assessee was reluctant to cooperate with the investigation for a long time and refused to give details to the range staff. The assessee, first of all, submitted its reply to the range audit team on 04.03.2009. Further this case was transferred to the respondent and the assessee submitted data upto the period of June, 2011. On the basis of data made available to the respondent's office, the show cause notice for the extended period i.e. April, 2007 to June, 2011 has been worked out. 10. The other preliminary objection as to the maintainability of the writ petition is that the petitioner has an alternate and efficacious and statutory remedy available under the Central Excise Act, 1944 Rules, hence on this ground alone, the writ petition deserves to be dismissed. 11. Heard Mr. Arshad Hidayatullah, learned Senior Advocate for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of an implementing notification, the industrial policy will prevail. He further submitted that purported demand and recovery of duties of excise viz. NCCD, Education Cess and Secondary Higher Education Cess, as contained in the impugned notice, is in breach of the unequivocal '100% outright excise duty exemption' promised in the industrial policy, therefore the said demand is in gross violation of settled law on promissory estoppel. 14. Learned Senior Advocate for the petitioner contended that it is settled principle of law that where there is an Industrial Policy granting fiscal incentives (such as exemption from Excise Duty, Customs Duty, Income Tax, Sales Tax, etc.) to set up industry in backward areas of the State to encourage setting up of new industries in backward areas, the implementing notification issued thereunder, have to be given a liberal interpretation and the rule of strict interpretation has no application. In this context, learned Senior Advocate relied upon the judgments of Hon'ble Apex Court, rendered in 'State of Jharkhand and ors. vs. Tata Cummins Ltd. ors.', 2006 (SC1) GJX 205 SC (in Appeal (Civil) 10272 of 2003 decided on March ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retation of the same would defeat the object underlying the incentive Police as held out in State of Jharkhand vs. Tata Cummins and Bajaj Tempo (supra). 17. Per contra, Mr. Shobhit Saharia, learned Senior Standing Counsel for the Revenue submitted that as per the pleadings made in the writ petition and the material brought on record by the petitioner itself, it is clear that in the present case principles of promissory estoppel are not at all attracted, inasmuch as, petitioner has admittedly not acted upon the policy dated 07-01-2003 or any of its terms and clauses inasmuch as, as per the admission of the petitioner itself for the very first time petitioner approached the department for its registration and availing the tax exemption on 11.12.2006 and in the application it was specifically mentioned that it was as per the notification no. 50/2003 dated 10.06.2003. Further, nowhere it has been pleaded in the writ petition that petitioner in any manner whatsoever, believing on the policy decision dated 07.01.2003, took any steps detrimental to its interest, and thus, is in any manner whatsoever has the right of claiming the declaratory relief by invoking the doctrine of promissory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion made under the Central Excises and Salt Act, whether issued before, on or after 24.09.1984, shall have the effect of or be construed as, providing for exemption from the duty of excise livable under the said Central Law, unless such notification or order- (i) Expressly refers to the provisions of the said Central law in the preamble; or (ii) By express words, provides for an exemption from the duty of excise livable under the said Central law. 19. He submitted that in the case in hand Central Law is the Finance Act 2001, a declared provision within the meaning of section 2 of the Provisional Collection of Taxes Act, 1931, which provides for imposition of NCCD by virtue of its section 136 and as per the Act of 1982, in the exemption notification 50 of 2003, admittedly made after 24-09-1984, exemption from the provisions of Central law i.e. Finance Act 2001 cannot be read into, since provisions of Finance Act 2001 are neither mentioned in the preamble of the exemption notification issued under the Central Excises and Salt Act nor the notification 50/2003 expressly provides for exemption of duty of excise livable under the Finance Act 2001. It is further submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and deemed to be added in light of the Policy Statement. 22. I have considered the submissions advanced by the counsel for the respective party and have also gone through the law cited by them. 23. In the present petition, the petitioner has challenged the show cause notice dated 26.08.2011 issued by the Commissioner, Central excise Service Tax, Mumbai by which the petitioner has been asked to show cause as to why National Calamity Contingent Duty (NCCD), Education Cess, Secondary Higher Education Cess, interest and penalty should not be imposed. The petitioner has further prayed for declaring that the petitioner is entitled to avail the exemption under Notification No.50/2003 dated 10th June, 2003 in respect of the exemption contained therein from the levy of the duty of excise known as NCCD for a period of ten years calculated from the date of commencement of commercial production by the petitioner. In fact, the petitioner is seeking from this Court to grant a declaratory relief. 24. The learned Senior Advocate for the petitioner submitted that showing cause before the respondent no.3 would be a futile exercise as he, being adjudicating authority, has already made up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h that he is entitled to that exemption or concession. A provision providing for an exemption, concession or exception, as the case may be, has to be construed strictly with certain exceptions depending upon the settings on which the provision has been placed in the Statute and the object and purpose to be achieved. If exemption is available on complying with certain conditions, the conditions have to be complied with. The mandatory requirements of those conditions must be obeyed or fulfilled exactly, though at times, some latitude can be shown, if there is a failure to comply with some requirements which are directory in nature, the non-compliance of which would not affect the essence or substance of the notification granting exemption. 30. In Novopan Indian Ltd., this Court held that a person, invoking an exception or exemption provisions, to relieve him of tax liability must establish clearly that he is covered by the said provisions and, in case of doubt or ambiguity, the benefit of it must go to the State. A Constitution Bench of this Court in Hansraj Gordhandas v. CCE and Customs held that (Novopan India Ltd. case, SCC p. 614, para 16) 16 such a notification has to be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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