TMI Blog2003 (5) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... oils. Both the major oils and minor oils require processing for manufacture of banaspati. However, minor oils require more processing with the help of special technology and equipment involving heavy capital expenditure. Pursuant to policy decision by a Notification No. 27/87, dated 1st March, 1987, the respondent No. 1 specified certain inputs namely fixed vegetable oils of the description in column 2 of the table annexed in the said notification for use in the manufacture of final products namely vegetable products falling under sub-heading No.1504.00 of the schedule of the Central Excise Tariff Act, 1985 and the rates in the corresponding entry in column 3 to the said table as the rate at which credit may be granted for input in the manufacture of final products for the purpose of Section AAA of Chapter V of Central Excise Rules. By the said notification the Central Government further stipulated that grant of credit and utilisation thereof shall, in addition to the provision of the section, be subject to certain conditions as specified in the said section. It was one of the conditions in the notification that the quantity of credit utilised for payment of duty of excise any clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dit a sum of Rs. 16,41,35,889/-. After abolition of duty of banaspati there was no scope for utilisation of accumulated credit in the manner provided in the Notification No. 45/89. 5.Mr. A.K. Mitra, Senior Advocate appearing with Mr. Debal Banerjee, Senior Advocate and Mr. Anirudha Bose, learned Advocate submits highlighting the fact of the case recorded as above that withdrawal of Notification No. 45/89 is wholly illegal and arbitrary by reason of the fact that the right already vested in favour of the petitioners cannot be taken away. His clients acting upon the Notification No. 45/89 has utilised minor oils as input for finished product of banaspati. In this process the petitioners had to change plant and machinery suiting for use of minor oils and thereby invested a large amount. Therefore, the credit accumulated in terms of the above notification shall be allowed to utilise. This right is a vested one and cannot be divested. The respondents are estopped from acting contrary to the Notification No. 45/89. In support of his submission he has drawn my attention to a judgment of the learned Single Judge of this Court, which is annexed, to the petition. He has also placed relianc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise duty payable by the petitioners in respect of other items produced by it. Though there is no specific challenge in the writ petition however, by a supplementary affidavit the Notification No. 45/89 has been challenged insofar as it imposes bar of refund. Mr. Mitra contends that the bar is wholly unreasonable, arbitrary and unfair. Therefore, this should be read down by elimination. 9.The notification did not say that the mode of enjoyment would become lapsed by reason of any government action of abolition of excise duty in relation to banaspati product. The notification by implication and upon reasonable interpretation should mean that the balance amount of credit lying unadjusted when the mode of adjustment is rendered impossible by an act of the government, would be made available to the beneficiary in reasonable and fair manner. His further contention is that no refund clause in the scheme should mean that as long as it is possible to adjust the credit against the excise duty payable on the final product of banaspati, there will be no refund of enjoyment of credit in other manner but when that mode of utilisation or enjoyment will cease to be available by reason of actio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e credit is not acceptable on the basis of grammatical construction of the notification." 13.While holding so Her Lordship applied the principle of promissory estoppel. In the concluding portion of the judgment Her Lordship held the petitioners would be entitled to relief of the benefit available under Notification Nos. 45/89 and 46/89. Over and above I am of the view if the benefit already accrued is construed to have been taken away in view of rescinding of the notification, then it amounts to giving retrospective effect of an administrative order without mentioning date which is absurd proposition. It is settled law no retrospective effect can be given to an administrative order. Under these circumstances, I have no option but to hold that the petitioners are entitled to get the credit albeit rescinding of Notification No. 45/89 and it did not and does not lapse. So, first question is decided accordingly. 14.Next question remains whether petitioners can get other mode of adjustment of the accumulated credit otherwise than provided in the Notification No. 45/89. In this context, it is necessary to reproduce the relevant portion of Notification No. 45/89. "The input, namely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... money is possible, simply it was neither agreed upon nor spelt out. 17.Now, the manufacturer need not pay any excise duty as the incidence of payment of excise duty has been removed altogether for the present keeping unadjusted credit outstanding, and making the product excise duty free. 18.It is true mode of liquidation of credit has been taken away, but it cannot be termed to be unconstitutional or arbitrary action, as the petitioners have not suffered at all. It is contended in the affidavit-in-opposition the scheme did not envisage any other mode of liquidation of credit. The question of refund does not arise firstly the scheme did not provide, secondly refund of credit presupposes realisation of the money. The credit is correlated to the excise duty leviable upon banaspati. No assurance was ever given that such benefit of credit could be extended otherwise than adjustment. 19.As far as the question of validity from the Constitutional point of view of the Notification No. 45/89 relating to "no refund" clause is concerned, I am of the view that the aforesaid notification is not a piece of legislation, rather it is policy decision. It is clear that the appropriate departmen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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