Allahabad High Court
Flex Engineering Limited vs The Customs, Excise And Gold (Control) ... on 10 January, 2007
Author: Rajes Kumar
Bench: Rajes Kumar
JUDGMENT Rajes Kumar, J.
1. By means of the present writ petition under Article 226 of the Constitution of India, petitioner seeks the following relief.
i) to issue a writ of certiorari quashing the part of the final order No. 951/2000-B dated 12.5.2000 served on 18.7.2000 passed by the Customs, Excise & Gold (control) Appellate Tribunal read with orders dated 2.9.1999 and 29.6.1998 passed by the Commissioner (Appeals) Central Excise, Ghaziabad and the Additional Commissioner, Central Excise, Noida respectively in respect of confirming the demand of duty,
ii) To issue any other suitable, writ order or direction in the nature of Mandamus directing the respondents to treat the certifications dated 31.3.1997 and 5.9.1997 as valid certificates under Notification No. 108/95-CE dated 28.8.1995.
iii) Issue any other suitable writ, order or direction which this Hon'ble Court may deem fit and proper under the circumstances of the case.
iv) To award the cost of the Writ petition to the petitioner.
2. Brief facts of the case giving rise to the present writ petition are that the petitioner is engaged in the manufacture of machines and parts thereof, structures reservoirs, tanks and similar containers etc falling under Chapter 84 and 73 of the Central Excise Tariff Act, 1985 (hereinafter referred to as "Tariff Act") respectively. In terms of notification No. 108/95-CE dated 28.8.1995 all the goods falling under the Schedule to the Tariff Act are completely exempt from the Central Excise duty, if the same are supplied to the United Nations or an International Organization for their official use or to the project financed by the said United Nations or International Organization and approved by the Government of India, provided that before the clearance of the said goods, the manufacturer produces before the jurisdictional Assistant Commissioner of Central Excise, a certificate from the United Nations or an International Organization to this effect. The petitioner on the strength of the certificates dated 31.3.1997 and 5.9.1997 issued by the project authority submitted before the jurisdictional Assistant Commissioner, cleared the goods during the month of September, 1997 to November. 1997 from its factory to M/S Punjab Energy Development Agency on behalf of M/S Triveni Engineering & Industries Limited without payment of duty claimed to be exempted under Notification No. 108/95-CE dated 28.8.1995. The project being implemented was funded by the World Bank and duly approved by the Government of India.
3. Assistant Commissioner, Central Excise, Division-II, NOIDA issued a show cause notice dated 21.1.1998 to show cause why the Central Excise duty to the tune of Rs. 3,32,059/- be not recovered and why the penalty be not imposed under Section 11AC of the Central Excise Act, 1944 on the aforesaid clearance. On the receipt of the reply, demand was confirmed on the ground that the requisite certificate provided under the Notification was not furnished. Being aggrieved by the adjudication order, petitioner filed appeal before the Commissioner (Appeals), which was dismissed, vide order dated 2.9.1999. Petitioner further filed appeal before the Tribunal, which has been dismissed by the impugned order. Though, against the impugned order there was statutory remedy by way of reference under Section 35H of the Act, still the petitioner filed the present writ petition on 11.10.2000. The writ petition came up for consideration before this Court on 12.10.2000. On 12.10.2000, the Court has passed the order "on the request of Sri A.P. Mathur, Advocate, list in ordinary course". Thereafter, on several occasions the case has been adjourned either on the illness slip or on the request of Sri A.P. Mathur. At no point of time, the Court has entertained the petition or asked the learned Standing Counsel to file counter affidavit, though, counter affidavit has been filed on behalf of the respondents. The petition has neither been entertained by the Court nor it has been admitted till date. On 1.12.2006, when the matter came up for consideration, Sri A.K. Rai, learned Standing Counsel submitted that writ petition is not maintainable inasmuch as, there was an alternative remedy by way of reference under Section 35H of the Act and the petition is liable to be dismissed on the ground of alternative remedy.
4. Learned Counsel for the petitioner submitted that the alternative remedy is not an absolute bar and the question involved in the present writ petition relates to the interpretation of the Notification No. l08/95-CE dated 28.8,1995, He further submitted that the limitation for filing the reference application has been expired and this Court has no power to condone the delay as held by the Division Bench of this Court in the case of Central Excise Reference Application No. (4) of 2001 Commissioner of Central Excise v. Salora Industrial Limited decided on 13.9.2005. Thus, petitioner will become remediless and will suffer irreparable
5. Having heard the learned Counsel for the parties, 1 have given my anxious Consideration to the submission of the learned Counsel for the parties.
6. Admittedly, against the order of the Tribunal, there was a remedy by way of reference under Section 35H of the Act. Reference was to be filed within 180 days from the date of the receipt of the order Instead of filing reference, petitioner has chosen to file present writ petition in the year, 2000. Writ Petition came up for consideration before this Court on 2.10.2000. On that date instead of arguing the matter; learned Counsel for the petitioner requested the court to list the matter in ordinary course. Thereafter the matter came up for consideration before this Court on 10.09.2003 and thereafter the matter was listed number of times, but same was adjourned either on the illness slip of Sri A.P. Mathur, Advocate, or on his request. The petition has never been entertained or admitted at any stage. Thus, in case, if the petitioner has chosen to file writ petition instead of availing the statutory remedy by way of reference, it is the fault of the petitioner and the petitioner can only be held responsible. Learned Counsel for the petitioner is not able to show that the relief, which the petitioner is seeking in the writ petition, could not be sought in the reference proceeding.
7. In a recent decision in the case of Star Paper Mills Ltd. v. State of U.P. and Ors. reported in 2006 NTN (Vol. 31), 249, Apex Court has considered in detail the issue relating to the entertainment of the writ petitions when alternative remedy is available. Apex Court held as follows:
Except for a period when article 226 was amended by the constitution (42nd amendment) Act, 1976, the power relating to alternative remedy has been considered to be a rule of self imposed limitation. It is essentially a rule of policy, convenience and discretion and never a rule of law. Despite the existence of an alternative remedy it is within the jurisdiction of discretion of the High court to grant relief under article 226 of the Constitution. At the same time, it cannot be lost sight of that though the matter relating to an alternative remedy has nothing to do with the jurisdiction of the case, normally the High court should not interfere if there is an adequate efficacious alternative remedy. If somebody approaches the High court should ensure that he has made out a strong case or that there exist good grounds to invoke the extra-ordinary jurisdiction.
Constitution Benches of this Court in K.S. Rashid and Sons v. Income tax Investigation Commission And Ors. ; Sangram Singh v. Election Tribunal, Kotah and Ors. ; Union of India v. T.R. Verma ; state of U.P. and Ors. v. Mohammad Nooh AIR 1958 SC 86; and K.S. Venkataraman and Co. (P) Ltd. v. State of Madras , held that article 226 of the Constitution confers on all the High Courts a very wide power in the matter of issuing writs. However, the remedy of writ is an absolutely discretionary remedy and the High Court has always the discretion to refuse to grant any writ if it is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere. The Court, in extraordinary circumstances, may exercise the power if it conies to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted.
Another Constitution Bench of this Court in State of Madhya Pradesh and Anr. v. Bhailal Bhai etc. held that the remedy provided in a writ jurisdiction is not intended to supersede completely the modes of obtaining relief by an action in a civil court or to deny defence legitimately open in such actions. The power to give relief under Article 226 of the constitution is a discretionary power. Similar view has been reiterated in N.t. Veluswami Thevar v. G. Raja Nainar and Ors. ; Municipal Council, Khurai and Anr. v. Kamal Kumar and Anr. AIR 1988 SC 1321; Siliguri Municipality and Ors. v. Amalendu Das and Ors. ; S.T. Muthusami v. K. Natarajan and Ors. ; R.S.R.T.C. and Anr. v. Krishna Kant and Ors. ; Kerala state electricity Board and Anr. v. Kurien E. Kalathil and Ors. ; A. Venkatasubbiah Naidu v. S. Chellappan and Ors. ; and L.L. Sudhakar reddy and Ors. v. State of Andhra Pradesh and Ors. ; Shri Sant Sadguru Janardan Swami (Moingiri Maharaj) Sahakari Dugdha Utpadak Sanstha and Anr. v. State of Maharashtra and Ors. 2001 (8) SC 509; Pratap Singh and Anr. v. State of Haryana and G.K.N. Driveshafts (India) Ltd. v. Income tax Officer and Ors. 2003 (I) SCC 72.
In Harbans Lal Sahnia v. Indian Oil Corporation Ltd. , this Court held that the rule of exclusion of writ jurisdiction by availability of alternative remedy is a rule of discretion and not one of compulsion and the court must consider the pros and cons of the case and then may interfere if it comes to the conclusion that the petitioner seeks enforcement of any of the fundamental rights; where there is failure of principles of natural justice or where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged.
In G. Veerappa Pillai v. Raman & Raman Ltd. ; Assistant Collector of Central Excise v. Dunlop India Ltd. ; Ramendra Kishore Biswas v. State of Tripura ; Shivgonda Anna Patil and Ors. v. State of Maharashtra and Ors. ; C.A. Abraham v. I.T.O. Kottayam and Ors. ; Titaghur Paper Mills Co. Ltd. v. State of Orissa and Anr. ; Whirlpool Corporation v. Registrar of Trade Marks and Ors. ; Tin Plate Co. of India Ltd. v. State of Bihar and Ors. ; Sheela Devi v. Jaspal Singh Punjab National Bank v. O.C. Krishnan and Ors. , this Court held that there hierarchy of appeals is provided by the statute, party must exhaust the statutory remedies before resorting to writ jurisdiction.
If, as was noted in Ram and Shyam Co. v. State of Haryana and Ors. the appeal is from "Caeser to Ceaser's wife" the existence of alternative remedy would be a mirage and an exercise in futility. There are two well recognized exceptions to the doctrine of exhaustion of statutory remedies. First is when the proceedings are taken before the forum under a provision of law which is ultra vires, it is open to a party aggrieved hereby to move the High Court for quashing the proceedings on the ground that they are incompetent without a party being obliged to wait until those proceedings run their full course. Secondly, the doctrine has no application when the impugned order has been made in violation of the principles of natural justice. We may add that where the proceedings itself are an abuse of process of law the High Court in an appropriate case can entertain a writ petition (emphasis provided).
The above position was recently highlighted in U.P. State Spinning Co. Ltd. v. R.S. Pandey and Anr. .
8. In the case of U.P. Spinning Co. Ltd. v. R.S. Pandey and Anr. . (para 11 to 24), Apex Court has set aside the order passed by the High Court in the writ petition on the ground that the High Court should not entertain the writ petition when the statutory remedy was available under the Industrial Disputes Act, 1947 unless exceptional circumstances are made out.
9. In the case of Union of India and Anr. v. Balrampur Chini Mills Ltd., Balrampur and Anr. reported in 2003 UPTC, 982, order of the Tribunal was dated 5.12.2001 and the writ petition was entertained in the year 2002 but on the objection being raised by the learned Standing Counsel, this Court on 23.5.2003 has dismissed the writ petition on the ground of alternative remedy. This Court held that against the order of the Tribunal, reference lies, thus, writ petition is not maintainable. In the case of Union of India v. Excise and Gold (Control) Appellate Tribunal (Northern Bench), New Delhi and another decided on 18.07.2006. writ petition was entertained in the year 2001 and the writ petition was dismissed on 18.07.2006 on the ground of alternative remedy. 10. In the result, writ petition is dismissed on the ground of alternative remedy.