Tripura High Court
M/S Saytapal Shivkumar Ltd vs The Union Of India on 1 August, 2018
Equivalent citations: AIRONLINE 2018 TRI 283, AIRONLINE 2018 TRI 174
Bench: Ajay Rastogi, Arindam Lodh
Page 1 of 28
HIGH COURT OF TRIPURA
AGARTALA
(1) WP(C) NO.1523/2017
M/s Saytapal Shivkumar Ltd.,
a company incorporated under the provisions of the
Companies Act, 1956 and having their registered office at
Shed No. 26B, Arundhutinagar Industrial Estate, P.O. A.D.
Nagar, West Tripura-799003 and having its place of business
situated at Arundhutinagar Industrial Estate, Agartala,
represented by Rudra Sekhar Roy, S/O Shri Gouri Sekhar
Roy, authorized representative of the Petitioner Company,
aged about 40 years, resident of Krishnanagar, Agartala,
West Tripura.
----Petitioner
Versus
1. The Union of India,
Represented by the Commissioner,
Central Goods and Service Tax,
Kiran Medical Hall's Building,
1st, 2nd & 3rd Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
2. The Assistant Commissioner of Central Goods and
Services Tax, Division-I,
Kiran Medical Hall's Building,
1st Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
----Respondents
(2) WP(C) NO.1524/2017
M/s Dharampal Premchand Ltd.,
a company incorporated under the provisions of the
Companies Act, 1956 and having their registered office at
Shed No.13, Khatian No.4325, Arundhutinagar Industrial
Estate, P.O. A.D. Nagar, West Tripura- 799003 and having its
place of business situated at Arundhutinagar Industrial
Estate, Agartala, represented by Rudra Sekhar Roy, S/O Shri
Gouri Sekhar Roy, authorized representative of the Petitioner
Company, aged about 40 years resident of Krishnanagar,
Agartala, West Tripura.
----Petitioner
Page 2 of 28
Versus
1. The Union of India,
Represented by the Commissioner,
Central Goods and Service Tax, Kiran Medical Hall's Building,
1st, 2nd & 3rd Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
2. The Assistant Commissioner of Central Goods and
Services Tax, Division-I,
Kiran Medical Hall Building,
1st Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
----Respondents
(3) WP(C) NO.1525/2017
M/s Dharampal Satyapal Ltd.(Unit-I and Unit-II),
a company incorporated under the provisions of the
Companies Act, 1956 and having their registered office at
Shed No.26B, Arundhutinagar Industrial Estate, P.O. A.D.
Nagar, West Tripura-799003 and having its place of business
situated at Arundhutinagar Industrial Estate, Agartala,
represented by Debabrata Dey Roy, S/O Shri Nil Ratan Dey,
authorized representative of the Petitioner Company, aged
about 32 years, resident of A.D. Nagar, Agartala, West
Tripura.
----Petitioner
Versus
1. The Union of India,
Represented by the Commissioner,
Central Goods and Service Tax, Kiran Medical Hall's Building,
1st, 2nd & 3rd Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
2. The Assistant Commissioner of Central Goods and
Services Tax, Division-I,
Kiran Medical Hall Building,
1st Floor, Old RMS Choumuhani, Agartala,
P.O. Agartala, West Tripura, Pin-799 001.
----Respondents
For Petitioner(s) : Mr. A. Kashyap, Advocate
Mr. P. Prasad, Advocate
Mr. K. Roy, Advocate
For Respondent(s) : Mr. P. Datta, Advocate
Mr. T. Debbarma, Advocate
Page 3 of 28
HON'BLE THE CHIEF JUSTICE MR. AJAY RASTOGI
HON'BLE MR. JUSTICE ARINDAM LODH
Judgment Reserved on : 13th June, 2018
Judgment Pronounced on : 1st August, 2018
JUDGMENT
BY THE COURT( Per Hon'ble Mr. Justice Ajay Rastogi, C.J.) This batch of writ petitions since involve a common question of law and facts, with the consent of the parties are being disposed of by the present order. The facts are being noticed from WP(C) No.1523/2017.
2. The facts, in brief, which manifest from the record and relevant for the present purpose, are that the petitioner is the manufacturer/exporter/whole sale supplier of chewing tobacco/ cosmetic products, etc. The Government of India announced a separate industrial policy for the north-eastern region of the country in December, 1997 which proposed to stimulate synergetic development of industries in the region by giving a cluster of incentives which included exemption from excise duties, transport subsidies, capital investment subsidies, interest subsidies, and other benefits, etc. Pursuant to the policy of Govt. of India, a number of notifications were issued by the Ministry concerned, being Excise Notifications Nos.32/99 and 33/99 dt.08.07.1999 by which diverse benefits were extended to the entrepreneurs who Page 4 of 28 were running their business in the north-eastern region of the country. Under the first notification, all excisable goods were exempt from duty under the Act if the goods were produced by new industrial units which commenced their commercial production on or after 24.12.1997 and were located in defined areas specified in the annexure to the notification. The said benefit was extended for a period of ten years from the date of publication of the notification or from the date of commencement of commercial productions, whichever was later.
3. The second notification exempted goods produced in specified industries located in areas outside the growth centres and procedure was prescribed before obtaining the exemption under both the notifications that the manufacturer of goods in such industrial units would have to pay excise duty and subsequently claim refund from the Excise authorities. At a later stage, notification was issued on 31.12.1999, being Notification No.45/1999 withdrawing the excise exemption to cigarettes. However, the exemption was reintroduced on 17.01.2000 by Notification No.1/2000 and it was claimed by the entrepreneurs including the petitioner that they had set up units in a specified growth centre and claimed the benefits of Notification No.32/1999. It was allowed to the new entrepreneurs for some few months.
4. It was alleged that for some months the petitioners made payment of the excise duty and they were not refunded the amount and that is why writ petitions were filed before the Page 5 of 28 Gauhati High Court and certain interim orders were passed directing the provisional refund of the excise duty by the authorities to the petitioner-entrepreneurs.
5. Pending litigation before the Gauhati High Court, S.154 of the Finance Act 2003 was enacted by Parliament. The section reads as follows:
"154.Amendment of notifications issued under Section 5-A of the Central Excise Act.--(1) The notifications of the Government of India in the Ministry of Finance(Department of Revenue) Nos.G.S.R.508(E), dated 8-7-1999 and G.S.R.509(E), dated the 8-7-1999, issued under sub-section (1) of Section 5-A of the Central Excise Act read with sub-
section (3) of Section 3 of the Additional Duties of Excise (Goods of Special importance) Act, 1957(58 of 1957) and sub- section (3) of Section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978(40 of 1978), by the Central Government shall stand amended and shall be deemed to have been amended in the manner as specified against each of them in column (3) of the Ninth Schedule, on and from the corresponding date specified in column (4) of that Schedule retrospectively, and accordingly, notwithstanding anything contained in any judgment, decree or order of any court, tribunal or other authority, any action taken or anything done or purported to have been taken or done under the said notifications, shall be deemed to be and always to have been, for all purposes, as validly and effectively taken or done as if the notifications as amended by this sub-section had been in force at all material times.
(2) For the purposes of sub-section (1), the Central Government shall have and shall be deemed to have the power to amend the notifications referred to in the said sub-section with retrospective effect as if the Central Government had the Page 6 of 28 power to amend the said notifications under sub-section (1) of Section 5-A of the Central Excise Act read with sub- section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of Section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), retrospectively at all material times.
(3) No suit or other proceedings shall be maintained or continued in any court, tribunal or other authority for any action taken or anything done or omitted to be done, in respect of any goods under the said notifications, and no enforcement shall be made by any court, tribunal or other authority of any decree or order relating to such action taken or anything done or omitted to be done as if the amendments made by sub-section (1) had been in force at all material times.
(4) Recovery shall be made of all amounts of duty or interest or other charges which have not been collected or, as the case may be, which have been refunded but which would have been collected or, as the case may be, which would have not been refunded if the provisions of this section had been in force at all material times, within a period of thirty days from the day on which the Finance Bill, 2003 receives the assent of the President, and in the event of non-payment of duty or interest or other charges so recoverable, interest at the rate of fifteen per cent, per annum shall be payable from the date immediately after the expiry of the said period of thirty days till the date of payment.
Explanation.--For the removal of doubts, it is hereby declared that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable if the notifications referred to in sub- section (1) had not been amended retrospectively by that sub-section.‖ Page 7 of 28
6. The Ninth Schedule referred to in S.154(1) insofar as it is relevant seeks to amend Notification No.32/99 dt.08.07.1999 with effect from 08.07.1999 by excluding cigarettes falling under Chapter 24 of the First Schedule or the Second Schedule to the Central Excise Tariff Act, 1985. To simplify in other words, the exemption available to the manufacturers of cigarettes from 1999 up to 27.01.2001(except for a short period between 31.12.1999 and 17.01.2000 during which it was not available) was rescinded retrospectively. In consequence thereof, the excise duties already refunded to the entrepreneurs would be liable to be recovered, no further refund would be made and the entrepreneurs would be liable to pay the excise duty not paid when the exemption was in force between 08.07.1999 and 27.01.2001.
7. Batch of writ petitions were filed including by the present petitioners assailing constitutional validity of S.154 of Finance Act 2003.
8. The Apex Court in the case of R.C. Tobacco(P) Ltd. & Anr. v. Union of India & Anr. reported in (2005) 7 SCC 725 decided on 19.09.2005 upheld the constitutional validity of S.154 of the Finance Act 2003 and we consider it appropriate to quote the relevant extract of the judgment which reads ad infra:
―50. Furthermore having upheld the constitutional validity of Section 154 it would be a pyrrhic victory for the Union of India if they could not in fact recover the tax. It is not a case where the legislation has merely withdrawn the exemptions.Page 8 of 28
The consequences of the withdrawal have been statutorily provided for including the recovery of the excise duties refunded or not paid. The effective period of such imposition is about eight months. The State has been deprived of revenue without any corresponding benefit. It may be that the retrospective operation may operate harshly in some cases, but that would not by itself invalidate the demand. [See: Epari Chinna Krishna Moorthy v. State of Orissa, [(1964) 7 SCR 185 : AIR 1964 SC 1581]. It needs to be emphasized that in effect the retrospective operation extended over a very short period and principles of equity must give way to express statutory provision. As was said in Story on Equity (3rd Eng.Edn.1920) p.34:-
―Where a rule, either of the common or the statute law, is direct, and governs the case with all its circumstances, or the particular point, a court of equity is as much bound by it as a court of law, and can as little justify a departure from it."
9. After notifying S.154 of the 2003 Act, which had nullified the effect of Notification No.32/1999 retrospectively annulling the effect thereof altogether, the 1st respondent herein issued a demand notice dt.03.06.2003 to the two separate units of the petitioner-company for recovery of a sum of Rs.62,11,500/- and Rs.2,93,43,244/- in terms of the provisions of S.154 of the Finance Act 2003 to be paid within a period of thirty days from the date of the President's assent of the Finance Bill 2003 by which instrument it has been made an Act and become applicable with effect from 14.05.2003, failure to comply with the order within the specified date will entail interest at the rate of fifteen percent per annum in terms of S.154(4) and shall be payable from the date Page 9 of 28 immediately after the expiry of the said period of thirty days till the date of payment.
10. The demand notice dt.03.06.2003 was in respect of the benefit being drawn by the petitioner for the period November 1999 to February 2001 in terms of Notification No.32/1999 and demand notice dt.06.06.2003 was issued by the 1st respondent directing to pay the excise duty for the said period for which the benefit was raised, that again became a subject matter of challenge which reached upto the Apex Court in the case of the present petitioner and it was decided on 14.05.2015 in Dharampal Satyapal Limited v. Deputy Commissioner of Central Excise, Gauhati & Ors. reported in (2015) 8 SCC 519.
11. It may be noticed at this stage that the main thrust to question the validity of demand notice dt.03.06.2003 at the instance of the petitioner before the Apex Court was that no such recovery proceedings could have been initiated without a show cause notice being served as contemplated u/S.11-A of the Excise Act and initiating recovery proceedings without a show cause notice being served as claimed by the petitioners is in violation of the principles of natural justice. While taking note of the submissions in detail, in para 37 of the judgment in Dharampal Satyapal Limited(supra), the Apex Court finally arrived to a conclusion that ordinarily it is a requirement and imperative to issue a show cause notice by the assessing authority before Page 10 of 28 passing the order of recovery, irrespective of the fact whether S.11-A of the Act is attracted in the instant case or not on principle. But while examining the case of the present petitioner it was observed in para 45 in Dharampal Satyapal Limited(supra) that even after arriving to the conclusion that there was an infraction of the principles of natural justice but in the given case no purpose was going to be served in issuance of a show cause notice and which would be a futile exercise after the law has been laid down by the Apex Court in R.C. Tobacco(P) Ltd.(supra). We consider it appropriate to quote para 37, 39 and 45 of the judgment reported in (2015) 8 SCC 519 which reads ad infra:
―37. Therefore, we are inclined to hold that there was a requirement of issuance of show-cause notice by the Deputy Commissioner before passing the order of recovery, irrespective of the fact whether Section 11-A of the Act is attracted in the instant case or not.
39. We are not concerned with these aspects in the present case as the issue relates to giving of notice before taking action. While emphasising that the principles of natural justice cannot be applied in straightjacket formula, the aforesaid instances are given. We have highlighted the jurisprudential basis of adhering to the principles of natural justice which are grounded on the doctrine of procedural fairness, accuracy of outcome leading to general social goals, etc. Nevertheless, there may be situations wherein for some reason-perhaps because the evidence against the individual is thought to be utterly compelling-it is felt that a fair hearing ―would make no difference‖ -meaning that a hearing would not change the ultimate conclusion reached by the decision-
maker--then no legal duty to supply a hearing arises. Such an approach was endorsed by Lord Wilberforce in Malloch v. Page 11 of 28 Aberdeen Corporation[(1971) 1 WLR 1578], who said that:
(WLR p.1595: All ER p.1294) ―......A breach of procedure...cannot give(rise to) a remedy in the courts, unless behind it there is something of substance which has been lost by the failure. The court dos not act in vain.‖ Relying on these comments, Brandon L.J. opined in Cinnamond v. British Airports Authority[(1980) 1 WLR 582] that: (WLR p.593 : All ER p.377) ―.........no one can complain of not being given an opportunity to make representations if such an opportunity would have availed him nothing'.
In such situations, fair procedures appear to serve no purpose since ―right‖ result can be secured without according such treatment to the individual.
45. Keeping in view the aforesaid principles in mind, even when we find that there is an infraction of principles of natural justice, we have to address a further question as to whether any purpose would be served in remitting the case to the authority to make fresh demand of amount recoverable, only after issuing notice to show cause to the appellant. In the facts of the present case, we find that such an exercise would be totally futile having regard to the law laid down by this Court in R.C. Tobacco(supra).‖
12. It may be relevant to note that the quantification of the amount as reflected by the respondents in their demand notice impugned before the Apex Court was not disputed, even that has not been disputed even in the instant proceedings, and taking note the Apex Court in the case of the present petitioner finally arrived to a conclusion that issuance of a show cause notice would be an Page 12 of 28 empty formality and no purpose would have been served in the instant case of service of a show cause notice before the demand notice being raised by the respondents which was impugned in the proceedings dt.03.06.2003.
13. We consider it appropriate to quote the relevant paragraphs(46 and 48) of the judgment in Dharampal Satyapal Limited(supra) which reads ad infra:
―46. To recapitulate the events, the appellant was accorded certain benefits under Notification dated 8-7- 1999. This Notification stands nullified by Section 154 of the 2003 Act, which has been given retrospective effect. The legal consequence of the aforesaid statutory provision is that the amount with which the appellant was benefitted under the aforesaid Notification becomes refundable. Even after the notice is issued, the appellant cannot take any plea to retain the said amount on any ground whatsoever as it is bound by the dicta in R.C. Tobacco(supra). Likewise, even the officer who passed the order has no choice but to follow the dicta in R.C. Tobacco(supra). It is important to note that as far as quantification of the amount is concerned, it is not disputed at all. In such a situation, issuance of notice would be an empty formality and we are of the firm opinion that the case stands covered by ―useless formality theory‖.
48. Therefore, on the facts of this case, we are of the opinion that non-issuance of notice before sending communication dated 3-6-2003 has not resulted in any prejudice to the appellant and it may not be feasible to direct the respondents to take fresh action after issuing notice as that would be a mere formality.‖ Page 13 of 28
14. Thus, other judgments of the Apex Court of which detail reference has been made stands settled so far the present petitioner is concerned holding that non-issuance of a show cause notice has not resulted into any prejudice and the demand raised by the 1st respondent dt.03.06.2003 was upheld and as regards the interest is concerned in view of S.154(4), it specifically and expressly mandated with any element of discretion to be recovered within a period of thirty days from the day Finance Bill 2003 received the assent of the President and S.11-A of the Excise Act has no application for raising demand u/S.154 of the Act. After the final view being expressed by the Apex Court the petitioner was an obligation to satisfy the demand which was raised by the respondents but still the litigation would have not been put to rest and the notices issued to the petitioner in furtherance of the demand notice dt.03.06.2003 which has attained finality after the judgment of the Apex Court in the case of the present petitioners reported in (2015) 8 SCC 519 and dismissal of their writ petitions which questioning the validity of S.154 in view of R.C. Tobacco(P) Ltd.(supra) and various civil appeal being Civil Appeal Nos.8841-8844/2003 dismissed in the light of the decision of R.C. Tobacco(P) Ltd.(supra) on 07.04.2015. Litigation was kept alive by the petitioner as one or the other ground.
15. It reveals from the record that after judgment of the Apex Court upholding the demand notice dt.03.06.2003 which was raised in terms of S.154 of the Finance Act 2003, notices served to Page 14 of 28 the petitioner in furtherance thereof as a reminder to deposit the outstanding pending interest of Rs.15,73,62,158/- by Unit-I and Rs.2,47,52,368/- by Unit-II by 10.10.2015 in terms of S.154(4) of the Act dt.30.09.2015 and that was again assailed by the petitioner by filing of writ petition questioning the quantification of the amount which was indicated by the respondents in the respective notices dt.30.09.2015 and by an interim order dt.08.12.2015 this Court directed the assessing authority to give an opportunity of hearing to the petitioner to produce its records, accounts books and other material to show what amount has already been paid to the department and the amount, if any, due in terms of the demand notice dt.03.06.2003 with liberty to the assessing authority to pass a detailed order after affording opportunity of hearing the petitioner.
16. It further reveals from the record that in compliance of the interim order of this Court dt.08.12.2015 the petitioner appeared before the assessing authority on 25.04.2016 and the grievance primarily projected was that the Department has committed an error in calculation and two calculation sheets of interest due of their two Units at the time of personal hearing was furnished and the departmental calculation was based on thirty days of exemption/relief period as provided in the Act for paying interest from 14.05.2003, the date of assent of the Finance Act 2003 by the President of India dt.12.06.2003(both days inclusive) i.e. the interest was calculated taking into account the day Page 15 of 28 13.06.2003 but the petitioner has calculated interest from 14.06.2003 excluding the date of assent on 14.05.2003 and we consider it appropriate to quote the grievance which was raised by the petitioner in computing the component of interest due and noticed by the Assistant Commissioner in its order dt.19.05.2016 which was passed after affording opportunity of hearing to the petitioner after finalization of quantification of Govt. dues payable u/S.154 of the Finance Act.
―C No.IV(16)17/Tech/Recovery-Misc/CE/ACA/2015/Pt-I/1738 Dated 19.05.2016 To, M/S Dharampal Satyapal Ltd Shet No.14, Arundhutinagar Industrial Estate Agartala-799 003, Tripura Sir, Subject:- Finalization of quantification of government due, payable under section 154 of the Finance Act, 2003 in r/o M/s Dharampal Satyapal Ltd. Agartala(DSL), -regarding In compliance of Order date 08.12.15 of the Hon'ble High Court of Tripura quantification of Government due in respect of M/s Dharampal Satyapal Ltd.(Unit-I & II) Agartala(DSL) was made vide this office Order dated 04.04.2016 copy of which was endorsed to you.
In the said order dated 04.04.2016 interest calculated and payable by the assessee is as follows.
M/s DSL- Unit-I: Rs.16,38,11,349.00 & Unit-II : Rs.2,60,10,054.00.
In Para 11 of (D) Discussion and finding of the said Order dated 04.04.16 the assessee was allowed to submit their representation within 15 days from receipt of order, if they are aggrieved with the calculation of interest or any other issue.
The assessee did not submit any representation within the time period indicating their agreement, disagreement with the Page 16 of 28 calculation of the Department. However, in keeping with the tradition of the natural Justice, Personal Hearing was offered on 25.04.16 at 11.00 hrs and the assessee was informed accordingly.
The assessee M/S DSL attended the personal hearing and has submitted two calculation sheets of interest due for their two units at the time of hearing. From the calculation it appears that interest calculated by them is less than that of the interest calculated by this office. Scrutiny of their calculation reveals some differences with Department's calculation which can be attributed to the reasons mentioned below.
Departmental calculation, as it appears, is based on 30 days of exemption/leave period, as provided in the act, for paying interest from 14.05.2003, the date of assent of the Finance Act, 2003 by the President of India, to 12.06.2003(both days inclusive) i.e. interest was calculated taking into account the day 13.06.2003. But the assessee has calculated interest from 14.06.03 i.e. excluding the date of assent on 14.05.2003.
The assessee paid the principal amount during a long span of period from 2007 to 2012 i.e. long after the last due date of payment 13.06.03. Hence, there were one, two or three leap year viz 2004, 2008 & 2012 in the intervening paying period of principal amount.
In the Departmental calculation, the number of days in a leap year was counted as 366 days whereas the assessee has taken all the years as 365 days.
Hence, there is a difference of 1, 2 or 3 days against each day of payment.
Further, an amount of Rs.63,05,760/- was recovered by adjustment from the Escrow account of the assessee vide order dated 27.12.2007 issued by the Commissioner of Central Excise, Shillong. The assessee has taken the date of payment as 27.12.2007 i.e. date of order, whereas the Department has taken the date of payment as 29.12.2007.
Thus, differences, so arises between Departmental
calculate
Page 17 of 28
Sl. Assess Dept. calculation(In Rs. Assessees Difference(In
No. ee calculation(In Rs.)
Rs.)
1. M/S Unit I 16,38,11,349.00 16,36,03,934.97 2,07,414.03
DSL
Rounding off 16,38,11,349.00 16,36,03,935.00 2,07,414.00
2. M/S Unit 2,60,10,054.00 2,59,79,768.39 30,285.61
DSL II
Rounding off 2,60,10,054.00 2,59,79,768.00 30,286.00
After a careful examination of the method adopted by the assessee, M/S DSL in this regard, vis-à-vis the Departmental method, the calculation of Govt. dues as above made by the assessee and submitted during Personal Hearing on 25.04.16 appears to be reasonable and hence accepted. The calculation of Government dues(interest), payable under section 154 of the Finance Act, 2003 in respect of M/s Dharampal Satyapal Ltd.(Unit-I and II) Agartala(DSL) is hereby revised and modified accordingly.
Therefore, Government dues i.e. interest, payable under section 154 of the Finance Act, 2003 in respect of M/s DSL Unit-I is hereby finalized at Rs.16,36,03,935.00(Sixteen crore thirty six lakh three thousand nine hundred thirty five) only and in respect of M/S DSL Unit-II at Rs.2,59,79,768.00(Two crore fifty nine lakh seventy nine thousand seven hundred sixty eight) only.
The assesses are, therefore, requested to pay the said outstanding amount of interest of Rs.16,36,03,935.00(Sixteen crore thirty six lakh three thousand nine hundred thirty five) only for M/S DSL Unit-I and for M/S DSL Unit-II Rs.2,59,79,768.00(Two crore fifty nine lakh seventy nine thousand seven hundred sixty eight) only immediately.
Yours faithfully (B.K. Deb) Assistant Commissioner‖
17. The petitioner, thereafter withdrew the WP(C) No.447/2015 as reveals from the order dt.15.02.2017 to ventilate his grievance taking note of the view which was expressed by the Page 18 of 28 assessing authority i.e. Commissioner of Central Excise, Shillong in its order dt.03.08.2016 in the case of some other assessee and liberty was granted to the petitioner to approach the Commissioner, Central Excise, Shillong restraining the respondents from taking any coercive measure against the petitioner.
18. It has not been placed on record that what steps were taken by the petitioner after passing of the order by this Court with liberty granted to approach the Commissioner, Central Excise, Shillong but the fact reveals that further demand notice when served upon the petitioner dt.02.05.2017 as a reminder to make the payment of interest of Unit-I and Unit-II in terms of the provisions u/S.154(4) of the Finance Act 2003. Immediately after the demand notice being served dt.02.05.2017 by the Assistant Commissioner, the petitioner again submitted two preliminary objections dt.28.06.2017 that the liability of interest needs to be computed from thirty days after the correct computation has been informed to the petitioner and this has first happened in September 2015 during pendency of writ petition by the present notice and for affording opportunity to present their case in person for the reason that the interest is required to be recalculated from applicable date.
19. Both the two objections were primarily rejected/repelled by the Apex Court after affirming the demand notice dt.06.06.2003 and so also the fact that in the instant case Page 19 of 28 the petitioner was not required to be served with the show cause notice before the demand being raised and compliance of natural justice in the facts of the instant case would be an empty formality as observed by the Apex Court, obviously have no leg to stand, and accordingly, the Assistant Commissioner dealing with the objections further issued a demand notice on 20.06.2017 followed by 14.09.2017 to make the payment of interest of Unit-I and Unit- II in terms of the provisions u/S.154(4) of the Finance Act 2003 which has been impugned by the petitioner in the instant proceedings.
20. The main grievance of the petitioner is that the demand notice dt.14.09.2017 has been issued without granting effective opportunity of hearing of the petitioner which is mandatory u/S.11-A of the Excise Act and further it has been contended that in passing of the impugned demand the order of the learned CESTAT, Kolkata in EA-89/2008 has not been taken into consideration which clearly mandates that thirty days period will commence u/S.154(4) from the date on which a recovery order, specifying the amounts and interest payable, is communicated to the assessee and according to the petitioner the interest has to be computed from the date of the issuance of the demand notice dt.30.09.2015 which according to them is for the first time a quantified computation of demand of interest has been raised. Page 20 of 28
21. The further grievance of the petitioner is that the demand notice dt.14.09.2017 has been raised without taking into consideration the interim order dt.30.11.2012 of the Apex Court restraining the respondents from taking any coercive steps for recovery of additional demand towards interest and according to the petitioner's counsel that no interest could have been levied during the period operation of the interim order and at least without explaining the computed interest which was first deducted from the final notice served upon the petitioner under impugned notice dt.14.09.2017 be quashed & set aside.
22. The respondents have filed their counter affidavit and raised preliminary objections that the writ petition is not maintainable for the reasons that the demand notice dt.03.06.2003 followed by 06.06.2003 to make payment of recoverable duty within thirty days from 14.05.2003 and in case of delay in payment interest payable at the rate of fifteen percent per annum payable from the date immediately after expiry of thirty days from 14.05.2003 till the date of payment in terms of S.154(4) of the Finance Act 2003 has been finally upheld by the Apex Court in the case reported in (2015) 8 SCC 519 filed at the instance of the present petitioner and it is not now open for the petitioner to question the subsequent demand notice which has been sent in furtherance after dismissal of their writ petition by the Apex Court with the formal intimation to comply the demand notice dt.03.06.2003 which has attained finality after the Page 21 of 28 judgment of the Apex Court and what being raised is no more res integra and open for scrutiny.
23. It has been further urged by the counsel for the respondents that the petitioner is liable to pay principal amount with interest u/S.154 of the 2003 Act of which demand was raised on 03.06.2003 but the petitioner paid the principal amount in installments but did not pay the interest but after the Apex Court has made it clear that the interest u/S.154(4) of the Finance Act 2003 is payable by the assessee the present litigation which has been initiated at the instance of the petitioner is a futile litigation and deserves outright rejection.
24. Counsel for the respondents further submits that as and when the demand notices have been issued intimating the petitioner to pay the interest in terms of S.154(4) of the Act 2003 twice have approached this Court by filing writ petitions and by an interim order passed at one stage opportunity of hearing was also afforded and interest was recalculated as prayed for by the petitioner and nothing remained thereafter which would come to the rescue of the petitioner and the relief which the petitioner is seeking in the light of order dt.03.08.2016 passed by the ld. CESTAT, Kolkata in Appeal No.EA-89/2008 has not been looked into by the assessing authority. Once the interest is computable in terms of S.154(4) of the Finance Act 2003 and S.11(A) of the Excise Act has no application as held by the Apex Court and after Page 22 of 28 opportunity of hearing being afforded and interest being recalculated as prayed for by the petitioner which has been noticed by the assessing authority there remains no surviving grievance which could be further raised by the petitioner in the instant proceedings and what has been prayed for has been examined and settled by the Apex Court and the question is no more res integra to be examined by this Court afresh, particularly when the constitutional validity of S.154 has been upheld by the Apex Court in the case of R.C. Tobacoo(P) Ltd.(supra) and the demand notice raised in furtherance thereof by the respondents in the case of the present petitioner dt.03.06.2003 being upheld by the judgment reported in (2015) 8 SCC 519 and counsel submits that the present writ petition is not maintainable and deserves to be dismissed.
25. We have considered the submissions made and with their assistance perused the material available on record.
26. It is not disputed that the constitutional validity of S.154 of the Act 2003 has been upheld by the Apex Court in the case of R.C. Tobacoo(P) Ltd.(supra) and in furtherance thereof the demand notice which was raised by the respondents dt.03.06.2003 has been upheld by the Apex Court in the case of the present petitioner reported in (2015) 8 SCC 519 holding that there was always a requirement of issuance of show cause notice by the assessing authority before passing the order of recovery Page 23 of 28 irrespective of the fact whether S.11-A of the Act is attracted or not but in the given facts of the present petitioner the Apex Court in unequivocal terms arrived to the conclusion as observed in para 45 that any infraction of principles of natural justice in the instant case and to make a fresh demand of amount recoverable after issuance of notice to show cause, would be a useless formality and is not going to serve any purpose after the law has been laid down by the Apex Court in the case of R.C. Tobacoo(P) Ltd.(supra). More so, when the quantification of the demand raised has never been questioned by the petitioner and it was neither disputed before the Apex Court as observed in para 46 nor before us and after being settled that issuance of show cause notice in the given facts and circumstances of the present case of the petitioner would be an empty formality and no useful purpose is going to be served and once the demand notice dt.03.06.2003 has been upheld by the Apex Court further demand notice issued to the petitioner is only an intimation apprising of the demand which has not been paid for one or the other reason and at least not open for the petitioner to question the intimation which has been made to him to pay the demand after it has been upheld by the Apex Court.
27. It may be further noticed that when the notices were issued by the assessing authority to deposit the outstanding interest in terms of S.154(4) of the 2003 Act vide notice dt.30.09.2015 the petitioner submitted their objections and after affording opportunity of hearing in terms of the interim order of Page 24 of 28 this Court dt.08.12.2015 the authorized representative of the petitioner appeared before the assessing authority on 25.04.2016 and the only grievance raised was about the calculation made as to whether both days are to be made inclusive or the date of assent dt.14.05.2003 has been excluded for the purpose of computing thirty days for calculating the interest in terms of S.154(4) of the Act 2003 and the offer made by the petitioner to be calculated from 14.06.2003 was also accepted by the assessing officer as being reflected from the detailed report dt.19.05.2016 and thereafter again a notice was sent to the petitioner on 02.05.2017 followed by 20.06.2017 and thereafter 14.09.2017 and that again became a subject matter of challenge in the instant petition.
28. But to make it clear that the demand notices which were issued to the petitioner are in furtherance of the demand notice originally served dt.03.06.2003 for payment of interest in terms of S.154(4) of Finance Act 2003 and after the first demand notice dt.03.06.2003 has been upheld by the Apex Court, we find no reason to question the subsequent notices served upon the petitioner, more so, when the calculation was originally neither challenged before the Apex Court and nor before this Court but still when the opportunity was afforded the petitioner raised objection about one day of computation for the day on which the President's assent has to be excluded dt.14.05.2003 and that was noticed by the assessing authority before the impugned demand Page 25 of 28 notices being raised and we find no reason for the petitioner in filing the present batch writ petition and questioning the demand notices.
29. The submission of the petitioner's counsel of questioning the last demand notice dt.14.09.2017 without affording opportunity of hearing as mandated u/S.11-A of the Act we are extremely sorry to say that his very contention was repelled by the Apex Court at the stage when he questioned the first demand notice impugned dt.03.06.2003 regarding applicability of u/S 11-A of the Excise Act in the judgment reported in (2015) 8 SCC 519 of which a detail reference has been made by us and needs outright rejection.
30. The further submission made that the order of the CESTAT, Kolkata has not been considered by the assessing authority for computing the date of thirty days u/S.154(4) from the date amount of interest has been communicated to the assessee is wholly fallacious and deserves rejection for the reason that after the constitutional validity of S.154 of the Act 2003 has been upheld by the Apex Court, being clear & self explicit in terms that recovery of all amounts of duty or interest or other charges under the section has to be made within a period of thirty days from the date of interest or other charges which have not been collected for one time refunded would have to be collected if the provisions of this section had been in force at all material times, Page 26 of 28 within a period of thirty days from the day on which the Finance Bill 2003 receives the assent of the President and in the event of non-payment of duty or interest or other charges so recoverable, interest has been mandated to be charged at the rate of fifteen percent per annum payable from the date immediately after the expiry of the said period of thirty days till the date of payment under the mandate of law as being referred to u/S.154(4) of the Finance Act 2003 leaving no discretion with the assessing authority to charge interest at the rate of fifteen percent per annum, payable immediately after the expiry of the said period of thirty days till the date of payment and after being considered in detail in reference to the demand notice served upon the petitioner dt.03.06.2003 by the Apex Court, we are very sorry to say that it is not open for the petitioner to question in this Court after the demand notice dt.03.06.2003 has been upheld and notice issued in furtherance thereof and will not give a fresh cause of action to the petitioner questioning the validity of the subsequent demand notices served intimating to make the payment in terms of the notices earlier served impugned in the proceedings.
31. Further submission made by the petitioner's counsel that notice dt.14.09.2017 has been issued without taking into consideration the interim order of the Apex Court dt.30.11.2012 is without substance for the reason that the interim order passed by the Apex Court was merged into final judgment in the case of the petitioner repelling all his contentions and upholding the demand Page 27 of 28 notice dt.03.06.2003 which is not open to question of which a detail reference has been made in the case of the present petitioner reported in (2015) 8 SCC 519.
32. Before parting with the order we would like to express that a litigant has a right to invoke the inherent jurisdiction of this Court u/Art.226 of the Constitution for legitimate cause or any injustice being caused in the hands of the administration but must always honour after he met with the final fate of litigation. In the instant case, after the constitutional validity of S.154 of the Finance Act 2003 being upheld by the Apex Court in the case of R.C. Tobacoo(P) Ltd.(supra), the appeals preferred by the petitioner also came to be dismissed questioning the constitutional validity of S.154 of the Finance Act 2003 and after the demand notice dt.03.06.2003 served upon the petitioner in exercise of power u/S.154 of the Finance Act 2003 being upheld by the Apex Court repelling all his contentions by detailed judgment reported in (2015) 8 SCC 519 it was expected from the petitioner to come forward and volunteer to deposit in terms of the demand notices served by the department and honour the view expressed by the Apex Court and this practice being adopted of assailing for futile reasons just to defer, for the sake of convenience being affordable to the litigant, such tendency which has now been developed, is deprecated by this Court.
33. Consequently, in our considered view, the writ petitions are wholly without substance and accordingly dismissed. Mere Page 28 of 28 dismissal will not be suffice and we consider it appropriate to impose cost upon the petitioner.
34. Accordingly, the writ petitions are dismissed with cost of Rs.50,000/- each to be deposited with the Secretary, State Legal Services Authority.
(ARINDAM LODH), J (AJAY RASTOGI), CJ