TMI Blog1988 (8) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... differential excise duty for the period 1st March 1974 to 20th May 1974 amounting to Rs.99,631/- which amount was paid by the petitioners on the 11th March 1975 under protest. Aggrieved by the aforesaid levy, the petitioners preferred an appeal to the Collector which appeal was dismissed as according to the Collector, Agfa being the sole distributor was a related person. The petitioners Were thus liable to pay duty on the sale price of Agfa. Aggrieved by that order the petitioners filed in this Court, Misc. Petition No.841 of 1976 which they later withdrew. The petitioners continued to pay the excise duty on the price charged by Agfa under protest. They, however, filed their periodic refund claims in respect of the differential between the duty assessed on the sale price of Agfa and that on the sale price of the petitioners to Agfa. On the 11th of September 1984 the petitioners submitted their price list (Ex.K) along with their Agreement with Agfa and by an order dated the 31st October 1984 (Ex.L) Respondent No.2 approved the price list charged by the petitioners to Agfa. The petitioners thus started paying excise duty on their sale price to Agfa with effect from 1st November 1984. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. reported in 1983 (14) E.L.T. Page 1896, the Supreme Court has laid down that the price at which the excisable goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal is the basis for determination of assessable value provided, of course, the buyer is not a related person and the price is the sole consideration for sale. On a proper interpretation of the definition of 'related person' in sub-section (4)(c) of Section 4, the words 'a relative and a distributor of the assessee' do not refer to any distributor but they are limited only to a distributor who is a relative of the assesses within the meaning of the Companies Act 1956. The definition of 'related person' should be so read that the words 'a relative and a distributor of the assessee' should be understood to mean a distributor who is a relative of the assessee. As regards the other provisions of the definition of 'related person', that is to say, "a person who is so associated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, subsidiary company...." In other words, the Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the goods to the consumers. However, he is not a buyer of goods from the manufacturer on his own account and does not himself pay price for the goods purchased before the goods are passed on to the consumers. Merely by the use of word 'distributor' in the price list or the forwarding letter, it cannot be said that distributor was a 'related person'. Whether a distributor falls within the definition of 'related person" depends on the real substance of the transaction between the manufacturer and the distributor. If the distributor buys the goods and the price was the sole consideration for the sale and the transaction was at arm's length, he cannot be categorised as a 'related person'. Since in the instant case the price of goods was paid by the distributor in his capacity as a buyer, sales to such a buyer will fall within the provisions of Section 4(1) (a) of the Central Excises Act and as such he cannot be categorised as a 'related person' falling under Section 4(4)(c) ibid. In the case of buyer who purchases goods on payment of a commercial price to the manufacturer and transaction in effect is a sale, such a buyer even though a kind of distributor is different from the distri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price of petitioners to Agfa but on the sale price of Agfa to its customers is illegal. 9. The next question that falls for consideration is whether the petitioners would be entitled to the refund of this excess excise duty paid under protest. Mr. R.V. Desai, the learned Counsel appearing on behalf of the respondents has raised several technical pleas as debarring the petitioners from claiming the refund of the said levy. He firstly submitted that the petitioners had an alternate, efficacious remedy of an appeal against the decision of the Assistant Collector which appeal lay to the Collector and if the petitioners were aggrieved by the order of the Collector a revision lay to the Government of Maharashtra. Since the petitioners have not availed of the said remedy which the Central Excises and Salt Act provided, it was not open to the petitioners to claim the relief of refund in the present writ petition. It may be mentioned that this contention was not raised by Mr. Desai as a preliminary objection to the maintainability of the present writ petition at the commencement of the hearing of this petition but was raised at a much subsequent stage when Mr. Hidayatullah had crossed 2/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e proceedings in the direct violation of the law so declared. 13. If one applies the aforesaid decision to the facts of the present case, it is apparent that the respondents have ignored the law declared by the Supreme Court in the aforesaid cases of Bombay Tyre International and Atic Industries Ltd. and have proceeded to collect the excise duty in violation of the law so declared. It, therefore, cannot be held that it is not open to this Court to exercise its writ jurisdiction merely on the ground that a remedy of appeal and revision is open to the petitioners. It has been held in the case of Union of India v. Tarachand reported in 1983 (13) E.L.T. 1456(S.C.) = (1971) 3 S.C.R. Page 557 at page 570 that, the words "a decision or order passed by an officer" must mean a real and not a purported determination. A determination, which takes into consideration factors which the officer has no right to take into account, is no determination. In such cases the provision excluding jurisdiction of civil courts cannot operate so as to exclude an inquiry by them. In that case the Supreme Court relied upon the case of Anisminic Ltd. v. The Foreign Compensation Commission reported in (1969)1 A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent petition was, therefore, not maintainable. The petitioners were also estopped from raising the same contention which they had impliedly given up by withdrawing the said petition. Mr. Desai relied upon the case of Sarguja Transport Service v. S.T.A. Tribunal reported in AIR 1987 S.C. Page 88 wherein dealing with the effect of the withdrawal of a writ petition filed under Articles 226 and 227 of the Constitution of India without permission to file a fresh petition, it was held that the principle underlying Rule-1 of Order XXIII of the Code should be extended in the interests of administration of justice to cases of withdrawal of writ petition also, not on the ground of res judicata but on the ground of public policy. It would also discourage the litigant from indulging in bench-hunting tactics. In any event there is no justifiable reason in such a case to permit a petitioner to invoke the extraordinary jurisdiction of the High Court under Article 226 of the Constitution once again. While the withdrawal of a writ petition filed in High Court without permission to file a fresh writ petition may not bar other remedies like a suit or a petition under Article 32 of the Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stopped from making such application and ask for such refund. 20. In the case of Leukoplast (India) Ltd. v. State of Goa reported in 1988 (36) E.L.T. Page 369A, this Court has held that there is no estoppel in law against a party in a taxation matter. Therefore, the submission on behalf of the revenue that the petitioners are barred to come out now with a case that the products are drugs and medicines in view of their own understanding of the said products cannot be accepted. 21. In view of the aforesaid decisions it must be held that the contention of Mr. Desai based on the principles of estoppel is without any substance. Mr. Desai further submitted that the present petition has been filed after undue delay and the same suffers from laches. Hence, the present petition is liable to be dismissed on that account. I am not impressed by this submission as the petitioners have all alone been paying the excise duty claimed by the respondents under protest. When their protest against the claim of the Department was negatived in the year 1975, they preferred an appeal which was dismissed. Though they had withdrawn their Misc. Petition No. 841 of 1976, they continued to pay under protes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I am pointed out the decision in Writ Petition No. 2204 of 1988 decided by Justice Sawant and Justice Kantharia on the 6th July 1988, wherein a contrary view has been expressed by placing reliance in the case of Nawabganj Sugar Mills v. Union of India - AIR 1976 S.C. 1152; Mis Shiv Shankar Dal Mills v. State of Haryana - AIR 1980 S.C. Page 1037; Amar Nath Om Prakash v. State of Punjab and Food Corporation of India v. State of Punjab - AIR 1985 S.C. 218; U.P State Electricity Board v. City Board, Mussoorie - AIR 1985 S.C. Page 883; State of Madhya Pradesh v. Vyankatlal - AIR 1985 S.C. Page 901; Ogalc Glass Works Ltd. v. Union of India -1979 E.L.T. (J 468) - 79 B.LR. Page 37. 24. It has been pointed out in the case of Jaisri v. Rajdewan Dubey reported in AIR 1962 S.C. Page 83 that law will be bereft of all its utility if it should be thrown into a state of uncertainty by reason of conflicting decisions, and it is, therefore, desirable that in case of difference of opinion, the question should be authoritatively settled. It sometimes happens that an earlier decision given by a Bench is not brought to the notice of a Bench hearing the same question, and a contrary decision is given w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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