TMI Blog2021 (4) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... he refund granted earlier was because of any or all of the conditions mentioned under sub-Section (4), the refunds cannot be treated to be erroneous. The mandate of section requires the departmental Officer to apply its mind and only upon satisfaction of the conditions mentioned under sub-Section (4) of Section 11A can any refund granted earlier be treated to have been erroneously. It can be held that the concerned departmental Officer exercising power under Section 11A of the Central Excise Act must arrive at finding that the earlier order/refunds as have been granted in the present proceedings, were contrary to the law and therefore, erroneous and that the same are required to be reopened or recovered by invoking the powers under Section 11A. The refunds were granted by the Department in terms of the Judgment in M/S SRD Nutrients Private Limited [ 2017 (11) TMI 655 - SUPREME COURT ]. As discussed above, the Department accepted the Judgment of the Apex Court in M/S SRD Nutrients Private Limited (supra) and sanctioned the refunds. As such, the contention of the Department that the refunds granted earlier were erroneous and could be recovered under Section 11A cannot be accep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a judicial forum. Judicial Review in Show Cause Notice There is another aspect that needs to be dealt with in the present proceedings. The petitioners before this Court in the present proceedings are questioning the show cause notices issued by the department. Although, the High Court in exercise of judicial review under Article 226 of the Constitution of India would not ordinarily interfere with the show cause notices issued, however, where a show cause notice has been issued by an authority wholly without jurisdiction or by way of wrongful usurpation of power, the person aggrieved need not be relegated to avail any statutory alternative remedy available - In the facts of the present case, there is no dispute that the refunds granted earlier to the petitioners were in pursuance to judicial orders passed by the Apex Court in M/S SRD Nutrients Private Limited [ 2017 (11) TMI 655 - SUPREME COURT ] and/or orders passed by this Court in writ applications filed by some of the petitioners. As held by the Apex Court, declaration of judgment to be rendered per incuriam by latter judgment will not upset the binding effect of the judgment between the litigating parties. As the depar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D., M/S JSVM PLYWOOD INDUSTRIES LTD. (FORMERLY KNOWN AS M/S ARUNACHAL SAW AND VENEER MILLS PVT. LTD., GREENPLY INDUSTRIES LTD., M/S GATTANI POLYMERS, M/S NEW AGE PETCOKE PVT. LTD., NORTH EAST ROOFING (P) LTD., M/S K.D. COKES, UPPER ASSAM PETROCOKE PRIVATE LIMITED, M/S. K.D.IRON AND STEEL CO., M/S PRAG ELECTRICALS PVT LTD, M/S JUMBO ROOFING AND TILES, M/S GUWAHATI CARBON LIMITED, M/S. PCL CEMENT AND PIPE INDUSTRIES, M/S OZONE AYURVEDICS, M/S RIVER VALLEY CEMENT CORPORATION, JUDGMENT ORDER (CAV) Heard Dr. A. Saraf, learned senior counsel assisted by Mr. P. Das, learned counsel for the petitioner in WP(C) No. 2918/2020, WP(C) No. 1366/2020, WP(C) No. 2916/2020, WP(C) No. 2920/2020, WP(C) No. 2926/2020, WP(C) No. 2940/2020, WP(C) No. 3155/2020, WP(C) No. 3156/2020, WP(C) No. 3237/2020, WP(C) No. 3298/2020, WP(C) No. 3372/2020, WP(C) No. 3464/2020, WP(C) No. 3763/2020, WP(C) No. 4031/2020, WP(C) No. 4035/2020, WP(C) No. 4046/2020 and WP(C) No. 4194/2020. 2. Mr. R. K. Choudhury, learned counsel assisted by Mr. A. Das, learned counsel appears for the petitioners in WP(C) No. 1780/2020, WP(C) No. 2899/2020 WP(C) No. 4824/2020. 3. Mr. G. Sahe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Central Excise, Guwahati reported in (2018) 1 SCC 105 have been declared to be per incuriam. According to the Department, the refunds sanctioned to the petitioners earlier were made pursuant to the Judgment of the Apex Court in SRD Nutrients Pvt. Ltd. (supra) and the said Judgment having been held to be per incuriam by the Apex Court in the recent Judgment of M/S Unicorn Industries Vs- Union of India; the refunds earlier granted to the petitioners on the strength of the Judgment in M/S SRD Nutrients (supra) have become erroneous refunds and, therefore, the same are sought to be recovered from the petitioners by way of impugned show cause notice. 10. For enhancing the industrial progress in the North-East Region and for attracting the investees with a view to foster industrial growth and industrial activities in the North-East region, the Govt. of India announced an Industrial Policy Resolution vide Notification dated 24.12.1997. The Industrial Policy Resolution (hereinafter referred to as IPR ) contained a package of incentives and concessions for the industries established in the entire North-East Region. 11. The said IPR amongst others declared all industr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... strial Units existing before the 24th day of December but which undertook substantial expansion by way of increase in the installed capacity by not less than 25% on or after the 24th day of December, 1997. The exemption contained in the said notifications in terms of para 4 of the Notification was made applicable to any of the above stated Industrial units for a period not exceeding 10 years from the date of publication of the Notification in the official Gazette or from the date commencement of commercial production, which ever was later. 13. The Government of India on 01.04.2007 announced a new Policy, namely, the North-East Industrial and Investment Promotion Policy (NEIIPP), 2007. Vide the said Policy, the Government of India vide the NEIIPP, 2007 has also approved a package of fiscal concessions and other concession for the North-East Region. In the said new Policy NEJIPP of 2007, on the issue of the excise duty exemption under clause (v) it was clearly noted that hundred per cent excise duty exemption will be continued, on finished products made in the North-Eastern Region, as was available NEIP, 1997 . 14. In terms of the promise made by the Government of India in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oners had been claiming exemptions under Notification No. 20/2007-CE dated 25.04.2007, as amended, by way of refund excise duty through Account Current in respect of the above mentioned final products w.e.f. 25.11.2011. 17. By Finance Act, 2004, the Parliament levied Education Cess by way of the Finance Act, 2004. Education Cess was levied on goods specified in the First Schedule of the Central Excise Tariff Act, 1985, being goods manufactured or produced on which there shall be a duty of excise i.e. Education Cess, @ 2% calculated on aggregate of all duties of excise (including special duty of excise or any other duty of excise but excluding Education Cess on excisable goods) which are levied and collected by the Central Govt. in the Ministry of Finance (Department of Revenue) under the provision of Central Excise Act, 1944 or any other law for the time being in force. It was also provided that Education Cess on excisable goods shall be in addition to any other duties of excise chargeable on such goods under Central Excise Act, 1944 or any other law for the time being in force. The provisions of Central Excise Act, and the Rules made thereunder, including those relating to refu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Higher Education Cess which were paid along with excise duty as the excise duty itself was exempted from levy. In the said Judgment, the Apex Court held that Education Cess is payable on excise duty and those assessees who are required to pay excise duty have to shell out Education Cess as well. It was further held that Education Cess was introduced by Sections 91 to 93 of the Finance (No. 2) Act, 2004 and as per Section 91 thereof, Education Cess is the surcharge which the assessee is required to pay. The Apex Court held that Section 93 of the Act of 2004 made it clear that Education Cess is payable on the excisable goods i.e. in respect of goods specified in the First Schedule to the Central Tariff Act, 1985 and the same was to be levied @ 2% and calculated on the aggregate of all duties of excise which were levied and collected by the Central Government under the provisions of the Central Excise Act, 1944 or under any other law for time being in force. Subsection (3) of Section 93 provided that the provisions of the Central Excise Act, 1944 and the rules made thereunder, including those related to refunds and duties etc. shall as far as may be applied in relation to levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the case of Unicorn Industries Vs- Union of India, held that in the absence of notifications containing an exemption to additional duties in the nature of Education Cess and Secondary Higher Education Cess, it cannot be said that same are exempted. The Apex Court held that in Union Of India Ors Vs- M/S Modi Rubber Limited reported in (1986) 4 SCC 66, and in Rita Textiles Pvt. Ltd. and Ors. Vs- Union of India reported in (1986) Supp SCC 557 had already laid down the law and the subsequent judgment rendered by the Apex Court in the case of SRD Nutrients(supra) being contrary to the view taken earlier, was held to be per incuriam. The Apex Court in Unicorn Industries(supra) held that earlier binding judgments of the Apex Court in M/S Modi Rubber Limited and Rita Textiles Pvt. Ltd. were not placed for consideration and, therefore, decision of the Apex Court rendered in SRD Nutrients and Bajaj Auto Limited were clearly per incuriam. 24. After the decision of the Apex Court in Unicorn Industries, the Department issued impugned Demand-cum-show cause notices to the petitioners on various dates, seeking recovery of the refund of Education Cess, Secondary Higher Edu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner, CGST, Division Jorhat. 3 WP(C)/1780 /2020 M/S. DIGBOI CARBON PVT. LTD. Vs. UNION OF INDIA 2 ORS. Office and factory at Borguri Industrial State, Borguri, Tinsukia, Assam,Pin- 786126 excisable goods viz. Calcined Petroleum Coke E.Cess + S HE Cess= Dt.15.11.18 ₹ 34,41,786/- Dt. 05.12.18 ₹ 3,37,922/-Dt. 13.09.19 ₹ 10,63,719/- 06.02.2020 No. F.No.V(15)06/S CN/DCPL/ACT/2019-20 Assistant Commissioner, Central Goods Service Tax, Tinsukia. 4 WP(C)/2872 /2020 M/S OZONE AYURVEDICS, UNIT-II Vs. UNION OF INDIA 4 ORS Office and factory at EPIP, Amingaon, Guwahati, Dist- Kamrup, Assam- 781031 Ayurvedic Extracts, Cosmetics or Toilet Preparation and Medicaments of Ayurvedic ₹ 20,10,048/- C.No. V (18)10/SCN- CESS/OZONE AYURVEDICS- II/ACG-I/2020 dated 02.06.2020 Assistant Commissioner Guwahati, Assam. 5 WP(C)/2899 /2020 M/S GUWAHATI CARBON LI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... WP(C)/2935 /2020 OZONE PHARMACEU TICALS LTD. Vs. UNION OF INDIA 5 ORS. Office and factory at Export Promotion Industrial Park (EPIP), Amingaon, North Guwahati Circle, Dist-Kamrup, Assam. pharmaceuti cal products ₹ 93,38,718/- C.No.V(15)04/A DJ/CGST- HQRS/GHY/CE/ 2020 dated 18.06.2020 Joint Commissioner, Guwahati, Assam. 11 WP(C)/2940 /2020 M/S JOYSHREE POWEROL Vs. UNION of INDIA 3 ORS Place of Business at Sila Katamur, Mouza- Sindurighopa, Changsari, Kamrup(Rural), Assam- 781001 excisable goods viz. Diesel Generator Set and Acoustic Enclosure Electrical Panel ₹ 2,94,502/- C.NO.V(18)24/S CN- CESS/Powerol/ ACG- I/2020/2318 Dated 02.06.2020 Superintendent (Tech-I), CGST Central Excise Guwahati Division-I. 12 WP(C)/2947 /2020 M/S. OZONE AYURVEDICS Vs. UNION OF INDIA AND 4 ORS Office and Factory at EPIP, Amingaon, Guwahati, Dist- Kamrup, Assam- 781031 Ayurv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C.NO.IV(10)17/ E.CESS/CIL/Ref und/ACS 2019/693 Dated 09.06.2020 Assistant Commissioner. 18 WP(C)/3156 /2020 M/S. K.D.CEMENT S Vs UNION OF INDIA AND 2 ORS. Factory at Bhomraguri, Samaguri, P.O.- 782140, Dist- Nagaon, Assam product OPC, PPC PS Cement Clinker ₹ 19,46,217/- C.NO.V(18)327/ Refund/KDC/AC G-II/2018/697 Dated 28.07.2020 Assistant Commissioner, CGST, Guwahati Division-II 19 WP(C)/3166 /2020 M/S GATTANI POLYMERS Vs UNION OF INDIA AND 4 ORS Office at G.B. Gattani Industrial Complex, Mariani Road, Cinnamara, Jorhat, Assam. excisable commodities, viz. HDPE PP Circular woven Fabrics and Industrial Bags ₹ 2,51,967/- C.No.V(18)13/A CJ/REF/2019- 19/213 dated 23.01.2020 (read with Corrigendum No. C.No.V(18)13/A CJ/REF/2018-19/349-50 dated 13.02.2020) Assistant Commissioner, Jorhat, Assam. 20 WP(C)/3176 /2020 M/S AHINSHA CHEMICALS LTD. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/S. BULLAND CEMENT PVT. LTD. Vs THE UNION OF INDIA AND 4 ORS. Office and factory at Village Bamungaon, Lanka, Dist- Nagaon, Assam. excisable commodities viz Cement (OPC PPC) and Clinker ₹ 16,25,503/- C.No.V(18)247/ Refund/BCPL/A CG-II/2018 dated 28.07.2020 Assistant Commissioner, Guwahati, Assam. 26 WP(C)/3464 /2020 ASSAM ROOFING LTD. Vs UNION OF INDIA AND 2 ORS. Office and Factory situated at Bonda, Narengi, Assam. excisable commodities viz. Galvanized Plain Sheets, Galvanized Corrugated Sheets and Asbestos products ₹ 90,70,956/- C.No.V(15)15/A DJ/CGST- HQRS/GHY/CE/ 2020/750-51 dated 06.08.2020 Joint Commissioner, GST Central Excise Commissionera te, Guwahati. 27 WP(C)/3596 /2020 M/S. INDIA CARBON LTD. Vs UNION OF INDIA AND ANR. Office at Noonmati, Guwahati Calcined Petroleum Coke and Electrode Carbon Paste E.Cess + SHE Cess= ₹ 63 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TS INDUSTRY (UNITII) Vs UNION OF INDIA AND 4 ORS A sole proprietorship concern having their principal place of business at Shed No.11 12, Rani Industrial Area, Rani, Kamrup- 781131. Special Oxide Pigment, Damp Roof Powderfallin g ₹ 2,14,199/- V(18)23/SCN- CESS/Shandar- II/ACG-I/2020/2269 Dated 27.05.2020 alleged ₹ 2,14,199/-erroneous refund. Superintendent Technical-I 33 WP(C)/4031 /2020 M/S K.D. COKES Vs THE UNION OF INDIA AND 2 ORS Office at Village- Amerigog, 11 th Mile, Jorabat, G.S. Road, District- Kamrup, Assam Excisable Goods i.e Coke ₹ 5,91,532/- C.No.V(18)167/ Refund/K.D.CO KES/ACG- II/2018 dated 17.09.2020 Assistant Commissioner, CGST, Guwahati Division- II. 34 WP(C)/4035 /2020 NORTH EAST ROOFING (P) LTD. Vs UNION OF INDIA AND 2ORS. Registered office at Bonda, Narengi, Guwahati- 781026, Assam excisable commodities under broad description of Articles of Asbestos Cement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Guwahati-II Division, Guwahati. 39 WP(C)/4721 /2020 M/S NEW AGE PETCOKE PVT. LTD. Vs UNION OF INDIA AND ANR. Office and Industrial Unit at Palashbari, P.O. Kajalgaon, in the District of Chirang (BTAD), Assam. Calcined Petroleum Coke E.Cess + SHE Cess= 4,50,915/- Bearing No. GEXCOM/SCN/ CE/29/2020- TECH-CGST- DIV-BONG- COMMRTE- GUWAHATI-I/19126/2020/7 14 Dated 07.10.2020 Assistant Commissioner, GST Central Excise, Bongaigaon Division 40 WP(C)/4824 /2020 M/S BRAHMAPUT RA CARBON LTD Vs THE UNION OF INDIA AND 2 ORS Industrial Estate, New Bongaigaon, Assam-783380 Calcined Petroleum Coke (CPC). E.Cess + S HE Cess= Dt. 14.02.2019 ₹ 4,84,461/-Dt. 20.06.2019 ₹ 47,80,113/- Dated 07.10.2020 Assistant Commissioner. 41 WP(C)/4947 /2020 GREENPLY INDUSTRIES LTD. Vs UNION OF INDIA AND 3 ORS Makum Road, Tinsukia, Assam and its manufacturing unit at Lapa Lampong, Ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that under Section 11A of the Central Excise Act, 1944, the power for recovery of duties not levied or not paid or short levied or short paid or erroneously refunded, can only be invoked by the Department upon fulfillment of the circumstances provided under Sub-section 4 of Section 11 A of the Central Excise Act, 1944. 27.1. The learned senior counsel submits that in the fact of the present proceedings, the impugned show cause notices have been issued by the Department invoking Section 11A by holding that the refunds granted to the petitioners towards Education Cess and Secondary and Higher Education Cess. As the case may be, on the ground that the same were refunded erroneously. The learned Senior counsel submits that the basis for arriving at a conclusion by the department that the refunds were granted erroneously is solely on the ground that judgment of the Apex Court rendered in SRD Nutrients (supra) has been held to a judgment rendered per incuriam by the apex Court in the recent judgment of M/S Unicorn Industries (Supra). 27.2. The learned senior counsel submits that the condition precedent for exercise of power under Section 11A(1) of the Act are wholly missing in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Unicorn Industries (Supra), the refunds granted cannot be said to be erroneous and thereby the Department cannot seek to invoke the provisions of Section 11A of the Central Excise Act, 1944 and demand recovery of the refunds granted. 29. The learned Senior counsel submits that the term erroneous has been defined by the Black s Law Dictionary as involving error; deviating from the law . The learned counsel referred to the Judgment of the Apex Court in Malabar Industrial Co. Ltd. Vs. Commissioner of Income Tax, Kerala State, (2) 2 SCC 718 held that incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous. 30. The learned Sr. counsel submits that this Court in Rajendra Singh Vs. Superintendent of Taxes reported in 1990 Vol. 1 GLR 449 , held that erroneous means involving error; deviating from law. The Division Bench of this Court in the said judgment held that Erroneous assessment refers to an assessment that deviates from the law and is therefore invalid, and is a defect that is jurisdictional in its nature, and does not refer to the judgment of the assessing officer in fixing the amount of valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Central Excise Act, 1944 there is a provision for appeal against any order or decision passed under the Central Excise Act, 1944 by the Central Excise Officer lowering rank then a Principle Commissioner of Central Excise or Commissioner of Central Excise. It is submitted that no appeal has been filed by the Department against the order of the concerned departmental officer sanctioning the refunds of Education Cess and Secondary and Higher Education Cess to the petitioners. It is submitted that if the department was aggrieved they could have preferred an appeal as provided under Section 35 of the Central Excise Act. However, no such appeal has ever been preferred by the Departmental authorities, the refunds granted has long attained finality. 33. It is further submitted that in respect of WP(C) 2918/2020, W.P(C) No. 3156/2020, W.P.(C) No. 3237/2020, W.P(C) 3464/2020, W.P(C) No. 4035/2020, W.P(C) No 4046/2020, W.P.(C) No. 4194/2020 and W.P.(C) No. 1366/2020 , the refunds were granted on the basis of directions issued by this Hon ble Court in writ applications filed by the petitioners. No appeals against such orders were filed by the Department and therefore, the orders pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment, submits that there is no infirmity in the show cause notices issued as the same were issued pursuant to judgment of the Apex Court rendered in M/S Unicorn Industries (Supra). It is the submission of Mr. Keyal that in view of the judgments of M/S Unicorn Industries (supra) holding the earlier judgment SRD Nutrients (supra) to be per incuriam , the Department is duty bound in law to treat the refunds granted earlier to have been wrongly or erroneously granted. The learned Standing counsel submits that in view of the judgment of M/S Unicorn (supra) that the earlier judgments rendered in M/S SRD Nutrients(supra) was rendered per incuriam has occasioned the necessity of the issuance of the show cause notices by the Department for recovery of the refunds granted earlier in terms of the judgments of SRD Nutrients(supra). The learned Standing counsel submits that the Apex Court in M/S Unicorn Industries(supra) has held M/S SRD Nutrients (supra) to have been rendered in per incuriam in view that earlier judgments rendered by the Apex Court in Modi Rubber(supra) and Rita Textile Pvt. Ltd (supra) were not considered by the Apex Court while rendering M/S SRD Nutrients(supra). The le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) were contrary to law itself as it stood then as laid down in Modi Rubber(supra) and M/S Rita Textiles (supra), and thereby making it erroneous. The learned standing counsel contended that when a Judgment has been held to be per incuriam it amounts to overruling the Judgment and, therefore, it is deemed to be applicable from a retrospective period except otherwise when indicated in the Judgment itself. The refunds allowed to the petitioners earlier are now required to be recovered as they have become refunds erroneously made in view of the Judgment of the Apex Court in M/S Unicorn Industries (supra). The petitioners are under clear obligation to pay back the amounts which were received by them in terms of the Judgment of M/S SRD Nutrients (supra) which have been overruled presently. As the refunds granted earlier to the petitioners have become erroneous in view of the judgment of the Apex Court in M/S Unicorn Industries(supra), the demand-cum-show cause notices were rightly issued by the Department under Section 11A. 38. The learned standing counsel further contended that in terms of Notification No. 32/99 and 33/99 both dated 08.07.1999 and Notification No. 20/2007 dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l also referred to Judgment of the Rajasthan High Court in WP(C) No. 880/2018. The learned counsel strongly disputed the contentions of the petitioners that the Judgment of the Apex Court in M/S Unicorn Industries (supra) is prospective only and that it shall not affect the earlier settled cases. He submits that even though a case may not have been expressly over-ruled but once it has been held that it has been rendered per incuriam , it cannot be said that it lays down good law as held by the Apex Court in Mukesh K. Tripathi Vs- L.I.C. (2004) 8 SCC 387. He further refers to Sanchalakshri Vs- Vijyakumar Raghuvirprasad Mehta reported in (1998) 8 SCC 245 to submit that the Judgment of the Apex Court in M/S Unicorn Industries (supra) had not laid down any new law but has only interpreted the existing law and therefore, the Judgment will have to relate back to the date when the law came into force. The learned standing counsel submits that in Sanchalakshri (supra). The Apex Court held that the High Courts/Tribunal did not possess the same power as the Apex Court possess under Article 142 of the Constitution of India for doing complete justice, even in the absence of such a prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply to the said company. As far as the other petitioners are concerned, principle of res judicata will have no application. 40. The learned standing counsel further submits that a decision on an abstract question of law unrelated to facts which give rise to a right, cannot operate as res judicata. Nor also can a decision on the question of jurisdiction be res judicata in a subsequent suit or proceeding. He referred to the Judgment of Supreme Court Employees Association Vs Union of India reported in (1989) 4 SCC 187 in support of his contention. The relevant paragraph of the judgment is extracted as under:- 24. Thus, a decision on an abstract question of law unrelated to facts which give rise to a right, cannot operate as res judicata. Nor also can a decision on the question of jurisdiction be res judicata in a subsequent suit or proceeding. But, if the question of law is related to the fact in issue, an erroneous decision on such a question of law may operate as res judicata between the parties in a subsequent suit or proceeding, if the cause of action is the same. The Delhi High Court judgments do not decide any abstract question of law and there is also no question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in so far as the state of Sikkim is concerned, the Education Cess and Secondary and Higher Education Cess is not exempted and the industries in the state of Sikkim have paid the Education Cess and Secondary and Higher Education Cess to the Government. If this is permitted to continue it will leave to a anomalous situation resulting in territorial discrimination and which will be against the letter and spirit of Article 141 of the Constitution of India which provides that the law declared by the Supreme Court shall be binding on all Courts within the territory of India. 44. The learned counsel for the parties have been heard. The pleadings on record have also been perused. There is no dispute with regard to the facts that the petitioners before this Court have all set up their industries or under took substantial expansions of the industries and are manufacturing excisable items. The excise duty on the products manufactured by the petitioners are exempted under the Industrial Policy of 1997 and 2007. The petitioners claimed refund of the Education Cess and Secondary and Higher Education Cess paid as it was their contention, that since the excise duty on the products manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch were granted earlier to the petitioners. 45. The question which falls for consideration in the present proceeding is whether refunds granted earlier pursuant to the Judgment of the Apex Court in M/S SRD Nutrients Private Limited (supra) can be considered to be refunds erroneously granted in view of the subsequent Judgment of the Apex Court in M/S Unicorn Industries (supra) wherein the earlier Judgment of M/S SRD Nutrients Private Limited (supra) was held to be per incuriam and whether the same can be recovered under the provisions of Section 11A of the Central Excise Act as sought to be done by the Department. The further question that has arisen for consideration in the present proceedings is whether an order passed by the Quasi Judicial Authority under the Central Excise Department granting refunds earlier can be revisited by another co-lateral authority of the same Department in exercise of their powers under the Central Excise Act. To deal with the question presented, it is necessary to first refer to statutory provisions, under which the show cause notices were issued by the department under Section 11A and 11AA of the Central Excise Act, 1944 which reads as unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the duty, the Central Excise Officer shall, within five years from the relevant date, serve notice on such person requiring him to show cause why he should not pay the amount specified in the notice along with interest payable thereon under Section 11-AA and a penalty equivalent to the duty specified in the notice. 1[* * *] 2[(7-A) Notwithstanding anything contained in sub-section (1) or sub-section (3) or sub-section (4) 3[* * *], the Central Excise Officer may, serve, subsequent to any notice or notices served under any of those subsections, as the case may be, a statement, containing the details of duty of central excise not levied or paid or short-levied or short-paid or erroneously refunded for the subsequent period, on the person chargeable to duty of central excise, then, service of such statement shall be deemed to be service of notice on such person under the aforesaid sub-section (1) or sub-section (3) or sub-section (4) 3[* * *], subject to the condition that the grounds relied upon for the subsequent period are the same as are mentioned in the earlier notice or notices.] 4[(8) Where the service of notice is stayed by an order of a court or tribunal, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o determined along with the interest due on such amount whether or not the amount of interest is specified separately. (15) The provisions of sub-sections (1) to (14) shall apply, mutatis mutandis, to the recovery of interest where interest payable has not been paid or part paid or erroneously refunded. [(16) The provisions of this section shall not apply to a case where the liability of duty not paid or short-paid is self-assessed and declared as duty payable by the assessee in the periodic returns filed by him, and is such case, recovery of non-payment or short-payment of duty shall be made in such manner as may be prescribed.] [11-AA. Interest on delayed payment of duty.- (1) Notwithstanding anything contained in any judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provision of this Act or the rules made thereunder, the person, who is liable to pay duty, shall, in addition to the duty, be liable to pay interest at the rate specified in subsection (2), whether such payment is made voluntarily or after determination of the amount of duty under Section 11-A. (2) Interest, at such rate not below ten per cent, and no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 was reversed by the Apex Court itself in (1995) 1 SCC 58, but according to us that should not make any difference on the assessments already completed. On similar matter a Division Bench of Punjab Haryana High Court in 107 STC 332 observed as under: 4. From the perusal of Section 40 as reproduced above, it would be apparent that the Commissioner can call for the record of any case pending before or disposed of by any Assessing Authority or appellate authority to satisfy himself as to the legality or propriety of any proceedings or any order and pass such order in relation thereto as he may think fit. The Scope of revisional powers is, thus, only to examine legality or propriety of any proceedings or any order. That being the scope of the revision, the only question that, thus, needs determination is as to whether the appellate authority while accepting the appeals preferred by M/s. Free Wheels (India) Limited as on the day when the appeals were decided had committed any illegality or the orders suffered from any impropriety. All that is stated on behalf of the counsel representing the State of Haryana is that the appellate authority had based its decision on the deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after the revenue filed a review petition No. 1370/97 before the Apex Court on the ground that the judgment reported in (1992) 2 SCC 683 (supra) already stood reviewed and reversed in the case reported in (1995) 1 SCC 58 and therefore the order passed in the S.L.P. dated 3.3.1997 may be reviewed. 12. . 13. From the above, it can reasonably said that despite the fact that it was brought to the notice of the Apex Court that the earlier view expressed in (1992) 2 SCC 683 stood reversed in (1995) 1 SCC 58; yet the Apex Court did not review the order passed in the SLP inasmuch as the Division Bench judgment of this High Court in Mahavir Coke Industries case was on the basis of the then existing law i.e., (1992) 2 SCC 683 and could not be said to be wrong just because later on that view was upset in (1995) 1 SCC 58. We agree with the learned counsel that law laid down in Tax matters should normally be applied prospectively. No tax was collected by the appellant from the purchasers as per the law then existing. On the basis of what has been observed above, we are of the view that on the day the assessment order was passed and even on the day when the Assist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yana is that the appellate authority had based its decision on the decision of the Tribunal in Liberty Footwear Co., Kamal, which decision could not be held to be laying down the correct law in view of the later decision rendered by the Tribunal in Steel Kraft, Panipat. We do not find any merit in the contention of the learned counsel as on the day when the appellate authority decided the appeals preferred by Free Wheels (India) Ltd., the decision rendered by the Tribunal in Liberty Footwear Co., held the field. If on a subsequent decision the Tribunal has taken a contrary view it would not make the proceedings that have been finalised far earlier and are based upon an earlier decision of the Tribunal either illegal or improper. If the contention of the learned State counsel is upheld, it would result into endless litigation as all matters finalised earlier on the basis of law then in existence and holding the field would need reconsideration if law changes in succeeding years. All matters that have been finalised shall be then reopened, thus, unsettling the settled matters, in any case, as mentioned above, the order passed by the appellate authority which was based upon the law th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mittal Stainless Steel Pvt. Ltd. report in (2003) 11 SCC 441 , the Apex Court while dealing with the matter under Section 263 of the income tax act, 1961 held that the power of the commissioner under Section 263 must be exercised on the basis of the materials that was available to him when he exercised the power. The Apex Court held that the satisfaction of the Commissioner was not based on materials either legally or factually which would have given the jurisdiction to take action under section 263. It was held:- 6. In this particular case, the Commissioner has not recorded any reason whatsoever for coming to the conclusion that the assessing officer was erroneous in deciding that the power subsidy was capital receipt. Given the fact that the decision of the jurisdictional High Court was operative at the material time, the assessing officer could not be said to have erred in law. The fact that this Court had subsequently reversed the decision of the High Court would not justify the Commissioner in treating the assessing officer's decision as erroneous. The power of the Commissioner under Section 263 of the Income Tax Act must be exercised on the basis of the material tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Department to invoke its statutory powers under Section 11A read with Section 11AA of the Central Excise Act, 1944. What cannot be lost sight of is that the Department sanctioned the refunds demanded/claimed by the petitioners on the basis of the Judgment in SRD Nutrients without any demur. The contention of the departmental counsel that the refunds sanctioned become erroneous by virtue of the Apex Court holding the judgment of SRD Nutrients to be rendered per incuriam as the still earlier Judgments of the Apex Court rendered in Modi Rubber(supra) and Rita Textile(supra) were not considered, cannot accepted. It is not disputed that pursuant to the judgment of the SRD Nutrients, a review application was filed by the Department and which was dismissed on 10.07.2018. 54. As such a perusal of the law discussed above, it can be held that the concerned departmental Officer exercising power under Section 11A of the Central Excise Act must arrive at finding that the earlier order/refunds as have been granted in the present proceedings, were contrary to the law and therefore, erroneous and that the same are required to be reopened or recovered by invoking the powers under Section 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the demand-cum-show cause notice impugned in the present proceedings. Such a procedure sought to be invoked by the Department is completely alien in law as established by the constitution as well as the law laid down by the Apex Court in a catena of judgments. 56. In this context, it will be relevant to refer to meaning ascribed to a judgment by the Apex Court :- 2. Generally speaking, a judgment adjudicates on the rights of the parties as they existed before the suit in which it was obtained. A judgment is an affirmation of a relation between a particular predicate and a particular subject. So, in law, it is the affirmation by the law of the legal consequences attending a proved or admitted state of facts. Its declaratory, determinative and adjudicatory function is its distinctive characteristics. Its recording gives an official certification to a pre-existing relation or establishes a new one on pre-existing grounds. It is always a declaration that a liability, recognized as within the jural sphere, does or does not exist. 57. From the judgment of the Apex Court discussed above, it is evident that a Judgment decides the rights between the parties to a lis. Once a C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Procedure Code. Can such a decision be characterised as one reached per incuriam? Indeed, Ranganath Misra, J. says this on the point: (para 105) Overruling when made by a larger Bench of an earlier decision of a smaller one is intended to take away the precedent value of the decision without effecting the binding effect of the decision in the particular case. Antulay, therefore, is not entitled to take advantage of the matter being before a larger Bench. 59. This judgment of the Apex Court came up to be considered again in the Apex Court of Madras Telephone SC ST Welfare Association, reported in (2006) 8 SCC 662. In the said judgment the Apex Court held that since the rights of applicants were determined in duly constituted proceedings which determination as attained finality, a subsequent judgment of the Court or a tribunal taking a contrary view will not adversely affect the applicant in whose cases the orders have attained finality. The said judgment is extracted below: 21. Having regard to the above observations and clarification we have no doubt that such of the applicants whose claim to seniority and consequent promotion on the basis of the principles la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Reference No. 1 of 2012- Natural Resources Allocation reported in (2012) 10 SCC 1 held as under:- 48.1. The first limitation is that a decision of this Court can be reviewed only under Article 137 or a curative petition and in no other way. It was in this context that in para 85 of Cauvery (2) [1993 Supp (1) SCC 96 (2)], this Court had stated that the President can refer a question of law when this Court has not decided it. Mr. Harish Salve, learned Senior Counsel, is right when he argues that once a lis between parties is decided, the operative decree can only be opened in review. Overruling the judgment-as a precedent- does not reopen the decree. 48.2. The second limitation, a self-imposed rule of judicial discipline, was that overruling the opinion of the Court on a legal issue does not constitute sitting in appeal, but is done only in exceptional circumstances, such as when the earlier decision is per incuriam or is delivered in the absence of relevant or material facts or if it is manifestly wrong and capable of causing public mischief. For this proposition, the Court relied upon the judgment in Bengal Immunity case [ AIR 1955 SC 661 : (1955) 2 SCR 603] wherei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 11A of the Central Excise Act are inconsonance with law and should, therefore, not been interfered with as prayed for. The contentions urged by the Department, if accepted, will be self-defeating inasmuch as the refunds were granted earlier in terms of the Apex Court in M/S SRD Nutrients Private Limited (supra). From the pleadings, it is evident that even in the writ petitions filed before this Court, the Department accepted that the Apex Court in M/S SRD Nutrients Private Limited (supra) held that the Education Cess and Secondary and Higher Education Cess paid along with the excise duty were required to be refunded. The Department accepted the Judgment in M/S SRD Nutrients Private Limited (supra) and refunded the Education Cess and Secondary and Higher Education Cess notwithstanding the contrary view of the Apex Court in M/S Modi Rubber Limited and Rita Textiles Pvt. Ltd . 64. The Judgment referred to by the Department in M.A. Murthy (supra) to support the above contention does not come to the aid of the respondents. In this judgment, the Apex Court held that the law declared by the Supreme Court under Article 141 has to be assumed to be the law from ince ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Apex Court dismissed the application misc. application seeking condonation of delay of 148 days that had occurred in filing the said review petition. It is also submitted that a similar review petition in respect of M/S SRD Nutrients (supra) has also been filed and the same is pending before the Apex Court. No order passed by the Apex Court allowing or rejecting the said review petition has been brought before this Court till the date of hearing of these matters. In any view of the matter such orders that may be passed by the Apex Court in the review application will be binding on all including this Court. 66. The contra submissions of the respondents, however, do not deal with the proposition of law as laid down by the Apex Court in the case of A.R. Antulay (Supra) and Madras Telephone SC ST Welfare Association (supra).There is no quarrel with the submissions of the respondent that the earlier judgment under which the refunds were granted, namely, M/S SRD Nutrients (supra) has been declared in per incuriam by subsequent a judgment of the Apex Court rendered in M/S Unicorn industries (Supra). However, it is equally not disputed by the respondents that the refunds soug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds are required to be served by the Tribunal in the form of a show-cause notice to the person who is alleged to be a foreigner [see para 60 in Sarbananda Sonowal (2) [Sarbananda Sonowal (2) v. Union of India, (2007) 1 SCC 174] ]. Thereupon, the person has to be given a reasonable opportunity to file representation and also produce evidence. The Tribunal has been authorised to consider and allow prayer for production and examination of the witnesses which can be refused if found to be vexatious, or made with the intent to cause delay, etc. The evidence produced by the Superintendent of Police can also be recorded. The person concerned has to be heard before the Tribunal gives its opinion. The person concerned may appear in person or can be represented by a legal practitioner or an authorised representative. Opinion is to be given within a period of sixty days after the reference from the competent authority. No doubt, the Rules do not prescribe and require an opinion of the Tribunal to be a detailed judgment, nevertheless, it is obvious that the opinion rendered must state the facts and reasons for drawing the conclusions. It is a decision and an order. Fixing time-limits and reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... si-judicial bodies. Whenever a judicial or quasijudicial tribunal gives a finding on law or fact, its findings cannot be impeached collaterally or in a second round and are binding until reversed in appeal or by way of writ proceedings. The characteristic attribute of a judicial act or decision is that it binds, whether right or wrong. Thus, any error, either of fact or law, committed by such bodies cannot be controverted otherwise by way of an appeal or a writ unless the erroneous determination relates to the jurisdictional matter of that body. 25. In J.J. Merchant v. Shrinath Chaturvedi [J.J. Merchant v. Shrinath Chaturvedi, (2002) 6 SCC 635], when the learned counsel had pleaded that the National Consumer Disputes Redressal Commission cannot examine complicated questions of facts which require examination and cross-examination of experts including doctors and that the procedure followed for determination of consumer disputes being summary in nature is not suitable for determination of complicated questions, this Court rejected these contentions and held that under the Consumer Protection Act, 1986, for a summary trial, an exhaustive procedure conforming to the principles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tained finality, the later Judgment of the Apex Court in M/S Unicorn Industries (supra) holding M/S SRD Nutrients Private Limited (supra) to be per incuriam, will not permit the Department to unilaterally revoke or re-open the issue without taking recourse to the remedies available to them before a judicial forum. Such actions initiated by issuance of the impugned show cause notices, if permitted, will amount to revoking the earlier orders passed by the departmental officers exercising Quasi Judicial powers unilaterally and which action cannot be permitted in view of the law laid down by the Apex Court in Abdul Kuddus (supra). 69. Department Circulars Binding on Department Officers. It is contended by the petitioners that the actions of the department impugned in the present proceeding are contrary to departmental circulars/instructions issued by the department on 09.01.2020 whereby the field officers and department officers have been instructed to contest by filing Statutory Appeals/ Writ Appeals or Review Petitions or forward proposals for filing SLP to the Board in view of the judgment of the Apex Court of M/S Unicorn Industries (Supra), it is seen that the circular v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Ors. reported in (2004) 3 SCC 488 laid down that such circulars issued under Section 37B are not binding on the assessee. However, it will not be open to the Revenue to raise a contention contrary to the circular issued by CBEC. When the circular remains in operation, the Revenue is bound by it and it cannot be allowed to take the plea that it is not valid or that it is contrary to the terms of the statute. The relevant paragraph of the judgment is extracted below:- 12. The principles laid down by all these decisions are: (1) Although a circular is not binding on a court or an assessee, it is not open to the Revenue to raise a contention that is contrary to a binding circular by the Board. When a circular remains in operation, the Revenue is bound by it and cannot be allowed to plead that it is not valid nor that it is contrary to the terms of the statute. (2) Despite the decision of this Court, the Department cannot be permitted to take a stand contrary to the instructions issued by the Board. (3) A show-cause notice and demand contrary to the existing circulars of the Board are ab initio bad. (4) It is not open to the Revenue to advance an argument ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forcement of any of the Fundamental Rights contained in Part III of the Constitution but also for any other purpose . 15. Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field. 72. In that view of the matter, the show cause notices issued are required to be held to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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