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M/s. Modern Hotel Versus Commissioner of Excise & Others

2015 (8) TMI 999 - SUPREME COURT

Denial of refund claim - abkari business - Amount paid in addition to renewal fees of FL-3 License - Held that:- Appellant is not entitled to receive refund of ₹ 50 Lacs on account of subsequent deposit of required percentage of principal dues under the Amnesty Scheme of 2008. The amnesty earned in 2008 must be confined to the arrears of interest outstanding at the relevant time in 2008 and by that date the earlier deposits of ₹ 50 Lacs had already been appropriated towards interest. .....

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required to be paid in accordance with the proviso, to get the desired renewal. Such decision of the High Court in our considered view does not require any interference.

Factum of excise dues of one of the partners of the appellant and its subsequent payment under the Amnesty Scheme is not in dispute or controversy. This is apparent from the certificate dated 10.11.2008. Though large part of the interest amounting to several crores could not be recovered but that was on account of g .....

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a partnership firm and is aggrieved by dismissal of its Writ Appeal No.1055 of 2002 by an order dated 09th January 2008 wherein the Division Bench has chosen to place complete reliance on an earlier Division Bench judgment dated 24th June 2005 in W.A.No.1151 of 2005 (M/s. Hotel Highway & Anr. v. N.K. Subhin & Ors.). 2. The issue falling for consideration is mainly one of law relating to scope and interpretation of a proviso to Rule 13A(5) of the Foreign Liquor Rules as in force at the re .....

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renewal of the licence. 3. The facts of the case need not detain us for long except noting that the appellant firm was having a FL-3 licence to run a bar attached to a hotel at Kundara in Kollam District. The partnership firm was re-constituted on 01.10.1995 and one Shri J. Sasikumar was admitted as one of the partners. On 11.05.2001 the request of the appellant firm for renewal of its FL-3 licence was rejected by the Excise Commissioner on the ground that one of the partners had conducted abka .....

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acs towards the arrears in addition to the licence fee. On such payment the licence was renewed for that year. But the writ petition came to be dismissed on 02.04.2002 on a finding that a partnership firm could not claim a separate juristic identity as it is only a totality of every partner and so long one or more partner suffers from liability or disqualification, the licence could not be renewed till the statutory requirement of the relevant rule was satisfied. The appellant filed appeal beari .....

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pellant s licence got further renewal upto the year 2007-2008 only on the strength of earlier additional deposits of ₹ 50 Lacs in total. The writ appeal itself was heard on merits and dismissed by the impugned judgment dated 09.01.2008 following earlier Division Bench judgment dated 24.06.2005. 4. On behalf of appellant our attention was drawn to a subsequent development mentioned in I.A.No.1 of 2009 filed in this appeal. Paragraphs 9, 10 and 11 of the I.A. disclose that the Government of .....

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issued a certificate that no amount was now outstanding from said Mr. Sasikumar. The certificate is an enclosure to the I.A. and discloses that on payment of earlier noted amount the defaulters including J. Sasikumar got amnesty from paying not only the remaining 25% of the principal amount but also from liability to pay ₹ 2,73,47,650/- towards interest upto 31.05.2008. On the strength of such payment and subsequent development, in the I.A. the appellant sought an order from this Court fo .....

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e result of the main appeal, on furnishing of security to the satisfaction of the Commissioner of Excise. 6. In terms of that order the appellant has obtained refund of ₹ 50 Lacs from the concerned authority but on furnishing of required security to the satisfaction of the Commissioner of Excise. 7. When this appeal was taken up for hearing learned counsel for the appellant initially took the stand that due to passage of time and other reasons the appellant was not keen to press the appeal .....

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idavit the respondents have relied upon relevant proviso to Rule 13A(5) of the Foreign Liquor Rules and have taken the stand that the liability or disqualification of each of the partner in the defaulting firm shall be distributed but if such liability continues then for the purpose of the proviso the liability of one of the partners will be liability of the firm for the purpose of abkari arrears disentitling renewal as provided in the proviso. According to respondents the High Court has correct .....

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377; 50 Lacs had to be and was appropriated towards interest existing at the time the remittance was made and only the remaining dues of interest along with permissible 25% of the principal amount was subsequently written off as per Amnesty Scheme of 2008. The claim of the appellant that the amount of ₹ 50 Lacs was required to be or had been kept in a suspense account has been strongly refuted as false with a positive statement that the said amount was appropriated towards interest in acco .....

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e the earlier deposits of ₹ 50 Lacs had already been appropriated towards interest. No fault can be found in appropriating that amount because there is no dispute regarding the actual outstanding amounts of principal and interest which clearly find mention in the certificate dated 10.11.2008 (Annexure P-6) to I.A. No.1 on which appellant itself has placed reliance. 10. We are also of the considered view that since there was no challenge to the proviso to Rule 13A(5) of the Foreign Liquor R .....

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