Bombay High Court
Kamlakshi Finance Corporation Ltd. vs Union Of India on 19 October, 1989
Equivalent citations: 1990(47)ELT213(BOM)
JUDGMENT Desai, J.
1. There is no return filed, Shri Desai appears and states that he cannot support the impugned order.
2. In this matter Rule was issued by us on 5th September 1989. This was after hearing Shri R. V. Desai who appeared and waived service. Return was to be filed before 21st September 1989. Although we are in October and more than one month has passed since the date allowed for filing the return, no return has been filed.
3. This Writ Petition bears out the useless and unsatisfactory manner in which officers of the Excise Department carry out their duties and it does not matter whether the officers are attached to this division or that. The purpose of their orders appears to be to classify the product under the heading which will attract the maximum duty irrespective of whether that is the proper classification or not and also without taking into account the decisions of the Tribunal or of the Appellate Collector. Discipline would require that they would be bound by it but the paramount discipline in the Excise Department appears to be to try to secure as much money as possible from the assessees and not to do what is right or correct or legal.
4. A few facts may be stated. An order dated 4th January 1988 was passed by the Assistant Collector, Central Excise and Customs, Pune v. Division, one V. R. Kumre, holding the product under consideration to be covered by Heading 3919, whereas it was the case of the assessee that it was classified under Heading 8547. The assessee relied upon production of similar product at their Borivli factory where the Appellate Collector had ultimately decided that the product fell under sub-heading 8546. Very glibly the officer ignored this decision holding that it has no application since the assessee did not claim that their product fell within Heading 8546 but were contending that it fell within Heading 8547. The approach is totally improper and bears out the comments we have earlier made upon the approach of the excise officers. It was the department's contention that sub-heading 3919 covered the product and if an identical product had been held by an Appellate Collector to be covered by Heading 8546 that decision was required to be considered and applied by the Assistant Collector. However, as we indicated what the approach of these officers is and following that approach he brushed aside the contention of the assessee based upon a decision of the Appellate Collector. The Assessee went in appeal and the Appellate Collector remanded back the matter. It is observed very clearly in the remand order that the Assistant Collector has not given any reasons as to why he differed from the decision of the Collector of Central Excise (Appeals), Bombay, on which the appellant placed reliance before him. It is pointedly indicated that the ground given was untenable. The Assistant Collector of Central Excise was on remand directed to issue a reasoned and speaking order.
5. On remand another Assistant Collector one P. R. Joshi has passed the order on 12th May 1989. Apart from the curious and clumsy language of this order, the order on remand does not even satisfy the basic requirement which the Appellate Collector has enjoined, viz. to explain why the decision in the Borivli case was not to be applied. The assessee had before him, at the time of the second remand, also relied upon a decision of the Tribunal (CEGAT). The reply of the department was that since they had preferred an appeal to the Supreme Court from that decision the said decision should not be followed. That fallacious reasoning has appealed to the Assistant Collector. This is totally unacceptable and amounts to indiscipline of the worst sort. This indicates how quasi-judicial powers are being misused by people who are not qualified to exercise the same. Their only purpose seems to be to collect as much money as possible or to harass the assessees to the maximum extent possible. The difficulty is what is to happen in future, because we are quite sure that if we pass an order of remand such incompetent and indisciplined officers will go on passing orders in this unsatisfactory manner. There seems to be no control of the department over such officers.
6. As the officer has proved incapable of passing a proper order and we are not satisfied about his capacity to understand the decisions of the superior Courts in that behalf, we do not propose merely to remand the matter. Although it is not the business of the High Court to function as a Court of Appeal from excise matters, it is the function of the High Court to hold and observe that officers who are performing quasi-judicial functions will not behave in the manner in which Shri Joshi has behaved. We need not advert further to the order passed by Shri Kumre earlier since it has been sufficiently commented on by the Appellate Collector who has come to the conclusion that it is neither reasoned nor speaking.
7. Accordingly we make the Rule absolute in terms of prayer (a) to the extent of quashing the order dated 12th May 1989. It may be for the Department, if there is any competent officer, to allocate the matter to that officer to pass a proper order. However, it is clear that the department of excise is harassing the petitioner which may be compensated for by the respondents being directed to pay to the petitioner costs quantified at Rs. 1,000/-. Payment of costs will be condition precedent to the passing of a fresh order. Till the fresh order is passed the levy of excise duty will be as per classification 8546 which was the classification urged for orally by the assessee placing reliance on the decision of the Appellate Collector in the case of Borivli factory. Rule will also have to be made absolute in terms of prayer (b) as Exhibit-I is made part of the order of Shri Joshi which we have quashed. Application for refund of the assessee will have to be disposed of on merits.