Karnataka High Court
M/S K. Bhopal Engineerings vs The State Of Karnataka And Ors on 13 October, 2020
IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
DATED THIS THE 13TH DAY OF OCTOBER, 2020
BEFORE
THE HON'BLE MR.JUSTICE E.S.INDIRESH
WRIT PETITION No.222809/2020 (GM-RES)
Between:
M/s K. Bhopal Engineerings and
Contractors Pvt. Ltd.
Flat No.401 & 402
Veeru Castel
Durga Nagar Colony
Punjagutta, Hydrabad - 500 082
Represented by its Project Manager
Sri N.Somanath S/o Nagabhushan
Aged about 52 years
R/o No.189, 9th Street
Bank Avenue Kalyannagar Post
Bengaluru-560043
... Petitioner
(By Sri Subhash Mallapur, Advocate)
And:
1. The State of Karnataka
Represented by its Secretary
Department of Rural Development
& Panchayathraj
M.S. Building
Bengaluru - 560 001
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2. The Chief Executive Officer
Zilla Panchayath
Bidar - 585 401
3. The Executive Engineer
R.D.W. & S. Division
Office of Zilla Panchayath
Bidar - 585 401
... Respondents
(By Sri Shivakumar R. Tengli, AGA for R1;
Sri Prashant S. Kumman, Advocate for R2 & R3)
This Writ Petition is filed under Articles 226 and 227
of the Constitution of India, praying to call for records and
to quash the letter bearing No.EE/RDW&S Division/
Bidar/AB/2019-20/138 dated 22.05.2019 issued by the
third respondent (Annexure-H) declaring the same as
illegal and direct the third respondent not to
deduct/withhold any amount towards Central Excise Duty
and further direct the third respondent to release the
amount withheld/reserved towards Central Excise Duty.
This petition coming on for Preliminary Hearing, this
day, the Court made the following:-
ORDER
Though this writ petition is listed for Preliminary Hearing, by consent of the parties, it is taken up for final disposal.
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2. The petitioner claims to be a Private Company Limited registered under the Companies Act, 1956. The petitioner's company is involved in construction business and carrying on government construction works, being the class-I construction company. During the year 2012-2013, the third respondent had called for tender work providing Multi Village Water Supply Scheme to various villages in Bidar Taluk and District. The petitioner being the successful bidder, aforesaid work was entrusted to the petitioner by the third respondent and consequently, agreement was also entered between the petitioner and the third respondent. It is the case of the petitioner that the Government of India by notification dated 17.12.2012 has withdrawn all the earlier notifications published in respect of levy of excise and exemption of certain excisable goods, had published the list of excisable goods and the rate of levy of excise. In the said notification at Sl.No.233, the machineries and pipes used for the purpose of water treatment plants to make the water fit for human 4 or animal consumption were exempted from payment of Excise Duty. After receipt of the work order from the third respondent, the petitioner had requested the Deputy Commissioner through the third respondent to issue Excise Duty Exemption Certificate in accordance with the Government of India Notifications. Thereafter, the Deputy Commissioner had issued Excise Duty Exemption Certificate. The petitioner had utilized the said certificate for executing the work as per the agreement entered by him with the third respondent. The third respondent by letter dated 22.05.2019 had informed the petitioner that a sum of Rs.36.15 lakhs is the amount towards 12.36% of the cost of project and the same is to be recovered from the petitioner. Being aggrieved by the same, the petitioner made representation to the third respondent on 12.12.2019 (Annexure-M) stating that action of the third respondent in reserving a sum of Rs.36.15 lakhs towards Central Excise Duty in the amount payable to the petitioner is contrary to the notification issued by the Government of India. Since the third respondent has not 5 considered the same, the petitioner presented this writ petition questioning Annexure-H and also sought for consideration of representation of the petitioner at Annexure-M.
3. Sri Subhash Mallapur, learned counsel appearing for the petitioner vehemently contended that directing the petitioner to make payment of Rs.36.15 lakhs towards 12.36% of the cost of project as Central Excise duty is contrary to the Excise Duty Exemption Certificate issued by the Government of India and accordingly, he sought for quashing of Annexure-H as well as to consider the petitioner's representation produced at Annexure-M.
4. Sri Prashant S. Kumman, learned counsel for respondents No.2 and 3 has submitted that the letter addressed by the third respondent at Annexure-H is in accordance with law and the same cannot be quashed on the ground that Excise Duty Exemption Certificate is produced by the petitioner, as the same is with respect to execution of the work which is not covered under the said 6 exemption granted by the Union Government notified on 01.03.2007.
5. Sri Shivakumar R. Tengli learned Government Advocate has supported the contention made by the learned counsel for the respondents No.2 and 3.
6. A perusal of the writ papers would indicate that the petitioner Company was involved in construction business and carrying on government construction work and accordingly respondent No.3 has executed work order for providing Multi Village Water Supply Scheme to Jampad and other 14 villages of Taluka and District Bidar as per work order issued in favour of the petitioner. It is the undisputed fact that the Government of India has issued a notification dated 01.03.2007 providing exemption of Central Excise duty for the pipes needed for delivery of water from storage point. The Government of India has withdrawn all the earlier notifications and thereafter issued one more notification on 17.03.2012 and the exemption was meant for certain excisable goods and accordingly 7 Sl.No. 233 of the notification dated 17.03.2012 is with regard to machineries and pipes used for the purpose of water treatment plant to make the water suitable for human and animal consumption and are exempted from payment of Excise Duty.
7. In view of the said notification the reasons assigned by the respondent No.3 produced at Annexure-H does not answer the notification issued by the Government of India dated 17.03.2012 and accordingly since, the respondent No.3 has not considered the case of the petitioner, in accordance with law, by passing a reasoned order produced at Annexure-H and as such the order dated 22.05.2019 produced at Annexure-H is quashed reserving liberty to the respondent No.3 to consider the grievance of the petitioner made in the representation dated 12.12.2019 produced at Annexure-M, in accordance with law, on considering the relevant notification issued by the Government of India.
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The writ petition is disposed of with a direction to the respondent No.3 to consider Annexure-M within two months from the date of receipt of this order.
Sd/-
JUDGE NB*/VNR