Calcutta High Court
Asstt. Collector Of Central Excise vs Duncans Agro Industries Ltd. on 20 September, 2002
Equivalent citations: 2003(152)ELT60(CAL)
Author: Amitava Lala
Bench: Amitava Lala
JUDGMENT Amitava Lala, J.
1. It appears to this Court that this contempt application has been placed under the heading 'Old Matters' before this Court and thereafter it was placed under the heading 'Old Adjourned Matters' and ultimately under the heading 'Specially Fixed Matters'.
2. It further appears to this Court that there was an order dated 12-3-1982 in a writ petition being C.R. No. 1856(W)/82 whereunder the goods were directed to be cleared off from the custody of the Collector of Central Excise, Calcutta upon deposit of certain sum by furnishing Bank guarantee in favour of such authority. The petitioners were entitled to take clearance of the goods in future without payment of differential duty only if the amount of such differential duty is covered by the amount deposited with the Receiver, i.e. the Advocate-on-record of the petitioners appointed under such order. On 12-3-1987, this matter came before a Bench of this Court whereunder Court ordered that if the respondents authorities do not receive any payment in cash within 25-3-1987, the respondents will be at liberty to encash the Bank guarantee forthwith. It is stated by the respondents that Bank guarantee was going to expire on 21-3-1987. The petitioners company did not give any undertaking of the renewal of the Bank guarantee till 25-3-1987 because according to them that liability of furnishing security is of a new company. However, it has been denied by them. In any event, the Court was pleased to pass a specific order that in view of the unwillingness to renew the, Bank guarantee, the respondents will be at liberty to enforce the Bank guarantee forthwith.
3. On enquiry, this Court has come to know from Mr. N.C. Roy-chowdhury, learned Senior Counsel appearing for the Central Excise Authority that such Bank guarantee was encashed.
4. It appears to this Court that the contempt application was made for violation of orders, one dated 12-3-82 and the other orders including the order dated 12-3-87 for not renewing the Bank guarantee submitted through the United Bank of India, Canara Bank to the tune of Rs. 95,81,734.08 p. A Rule was issued as far back as on 17-4-1989 and thereafter several orders were passed which have virtually in the form of direction.
5. At this belated stage a question cropped up before this Court whether the contemners/writ petitioners are liable to pay such amount and whether by non-payment of the amount or not giving Bank guarantee by the contemner No. 1 the original writ petitioner and the Advocate-on-record committed violation of the aforesaid two orders of the Court. Since the matter is pending for a considerable period, Court was pleased to direct filing of the supplementary affidavit and rejoinder in connection thereto to know the exact fate of such contempt application. The contemner came forward with a plea that at the present moment the payment which was directed to be made, has already been made. Therefore the original order or orders cannot be sustained. They have given a break up of differential duties which is as follows :
"Differential Duty
1. Due as per order dated 12-12-97 Rs. 15,07,26,077
2. Due as per order dated 30-12-98 (Corrigendum) Rs. 21,65,67,076
3. Payments made as recorded in the letter of the Assistant Commissioner of Central Excise dated 16-2-98 6,55,05,966 5,97,00,000 12,52,05,966 Rs. 14,02,05,966
4. Paid in February, 1998 1 , 50 , 00 , 000
5. Amount due as on March, 1998 Rs. 7,63,61,110
6. After Kar Vivad 50% became payable Rs. 3,81,100,555
7. The same was paid as would be apparent from the final certificate dated 16-6-99. Payment was made by TR-6 Challan dated 1-3-99."
6. Therefore, according to them since all the sums accepted by the authority not only after filing of the contempt application but also after the issuance of the Rule, the contempt application rendered infructuous. That apart, the contemners further contended that in view of several judgments including the latest one i.e. (R.N. Dey and Ors. v. Bhagyabati Pramanik & Ors.), the Supreme Court held that in a matter of contempt the Court will look into the facts and circumstances of the case. Whether the Court's dignity and majesty has been affected by the alleged contemner or not. A contempt application cannot be converted to a process of recovery of money. In such a situation, whether there was a wilful or deliberate disobedience of the order or not, it has to be ascertained by the Court. A very important portion has been dealt with by the Supreme Court in such matter in case of recovery of the compensation out of land acquisition. The important part is as follows :
"Even presuming that claimants are entitled to recover the amount of compensation as awarded by the trial court as no stay order is granted by the High Court, at the most they are entitled to recover the same by executing the said award wherein the State can or may contend that the award is nullity."
7. The reason of holding such view is that money claim simpliciter cannot be converted to a Contempt of Court.
8. According to the petitioners the subject matter was relating to payment of Rs. 95.81 lacs payable under the order of the Court cannot form part and parcel of Kar Vivad Samadhan Scheme, 1998. However, the violation of Rule of Contempt is obvious.
9. Mr. P.K. Mallick, learned Senior Counsel appearing for the contemners contended before this Court that they were confused by the terms and conditions of the Bank guarantee. The Bank guarantee has two parts which are as follows :
"Now the conditions of the above written Bond or obligation are such that if the above Rule is made absolute or if the above Rule is discharged then in such cases the above written bond or obligation shall be subject to direction or order that may be passed by the Hon'ble High Court in this matter otherwise the same shall remain in full forces and virtue until further order or orders of this Hon'ble Court.
Provided however that notwithstanding anything contained in the foregoing bond, the Bank's liability under this Bond is restricted to Rs._____________ (Rupees _____________) and this Bond shall remain in full force until further orders of this Hon'ble Court and unless a claim to endorse the claim under this bond is made against the Bank within six months from the date of expiry of this bond all claims under the bond shall be forfeited and the Bank shall be released from all liability under this Bond."
10. Therefore, contemners/writ petitioners were under the impression that the renewal of the Bank guarantee is automatically virtue of the order of the Court and there was no necessity of renewal of the same. Both the party are militating with each other which made confusion in the mind of the contemners. In any event, now the dispute has already been resolved. Therefore, if any violation has been committed to this Court, they are tendering their unconditional apology for the same.
11. On the other hand, Mr. Roy Chowdhury contended that even the Bank guarantee was renewed once inspite of having such clause, there-fore, subsequent non-renewal is wilful violation of the order/s.
12. According to me, excepting one particular word in the order dated 12-3-1987 nothing appears to be violative of the order of the Court. Such word is "unwillingness" in the third para of the order itself. Such word is militating with the explanation of Mr. Mallick. At the same time the encashment of the Bank guarantee has been done by the petitioners authorities. Therefore, the question of "unwillingness", automatically evaporates. But it was not evaporated when the Rule was issued. However, at present it appears that the subject matter of dispute become fait accompli in view of the delivery of the goods and payment of the entire sum being the differential duty.
13. Hence, I have no other alternative but to dispose of the contempt application only upon accepting unconditional apology by the con-temners without imposing any penalty, fine or any order for sending civil prison etc. but upon costs assessed at 600 G.M.s = Rs. 10,200/- towards thepetitioners. Accordingly, the contempt matter stands disposed of as against the Rule.
14. Personal presence of the contemners, if any, stands permanently disposed with.