Karnataka High Court
Simplex Infrastructures Ltd vs Simplex Infrastructures Ltd on 24 May, 2021
Author: B.M.Shyam Prasad
Bench: B. M. Shyam Prasad
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 24TH DAY OF MAY 2021
BEFORE
THE HON'BLE MR. JUSTICE B. M. SHYAM PRASAD
WRIT PETITION NO. 10766/2020 (T/RES)
BETWEEN :
1. SIMPLEX INFRASTRUCTURES LTD
BRIGADE PLAZA, UNIT C, 1ST FLOOR,
NO. 71/1, S.C. ROAD,
ANAND RAO CIRCLE,
BENGALURU - 560 009
REPRESENTED HEREIN BY ITS MANAGER,
MR. MD. TANVIR AKHTAR.
2. MR.S.B. DAS
SENIOR VICE PRESIDENT OF
SIMPLEX INFRASTRUCTURES LTD.
SON OF LATE R.L. DAS
AGED 63 YEARS
RESIDING AT NO. 4/54,
CHANDITOLA LANE,
KOLKATTA - 700 040.
... PETITIONERS
(BY SRI. SANDEEP HUILGOL., ADVOCATE)
AND:
1. THE JOINT COMMISSIONER OF
CENTRAL TAX
BENGALURU WEST
COMMISSIONERATE
OFFICE OF THE PRINCIPAL
2
COMMISSIONER OF CENTRAL TAX,
1ST FLOOR, BMTC BUS STAND,
KANAKAPURA ROAD, BANASHANKARI,
BENGALURU - 560 070.
2. THE SUPERINTENDENT OF CENTRAL TAX,
RANGE-E, DIVISION-5,
BENGALURU WEST COMMISSIONERATE
TTMC, BMTC BUILDING,
KANAKAPURA ROAD
BANASHANKARI,
BENGALURU - 560 070.
3. THE ADDITIONAL COMMISSIONER
OF CENTRAL TAX
(FORMERLY KNOWN AS THE ADDITIONAL
COMMISSIONER OF CENTRAL EXCISE,
BANGALORE III COMMISSIONERATE)
OFFICE OF THE COMMISSIONER OF
CENTRAL TAX PB NO. 5400,
CR BUILDING, QUEEN ROAD
BENGALURU - 560 001.
... RESPONDENTS
(BY SRI. JEEVAN J. NEERALGI, AGA)
THIS WRIT PETITION FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO
QUASH THE IMPUGNED ORDER-IN-ORIGINAL BEARING
C.NO. V/38/15/141/2017/B-III (WC-JC) AND OIO
NO.02/2019-20/5497/19 PASSED ON 14.06.2019 BY THE
1ST RESPONDENT UNDER THE CENTRAL EXCISE ACT,
1944 (ANNEXURE-A); ALTERNATIVELY, PERMITTING THE
PETITIONERS TO FILE APPEALS AGAINST THE IMPUGNED
ORDER-IN-ORIGINAL BEFORE THE COMMISSIONER OF
CENTRAL TAX (APPEALS), S1 AND S2, VINAYA MARGA,
SIDDHARTHANAGAR, MYSURU, AND DIRECTING THE SAID
FIRST APPELLATE AUTHORITY TO CONSIDER THE
APPEALS ON MERITS WITHOUT RAISING THE ISSUE OF
LIMITATION; QUASHING THE IMPUGNED LETTER
BEARING C.NO. IV/38/15/2019 EWD-5/5831 AND DIN-
3
20200957YU00002W3F0F DATED 03.09.2020 ADDRESSED
BY THE 2ND RESPONDENT TO THE PETITIONERS
(ANNEXURE-B).
THIS PETITION HAVING BEEN HEARD AND
RESERVED ON 31.03.2021 AND COMING ON FOR
PRONOUNCEMENT OF ORDERS THIS DAY, THIS COURT
MADE THE FOLLOWING:
ORDER
The first petitioner is a private limited company and the second petitioner is its Vice-president. The petitioners have filed this writ petition impugning the Order-in-original dated 14.06.2019 in No.V/38/151/141/2017/B-III (WC-JC) (referred to as, 'the Order-in-original') passed by the Joint Commissioner of Central Tax, Bengaluru West Commissionerate (the first respondent) and the Letter of Demand dated 03.09.2020 issued by Superintendent of Central Tax, Range - E, Division No. 5, Bengaluru West Commissionerate (the second respondent) demanding, pursuant to the impugned Order-in-original, excise duty of Rs.89,03,343/-, a penalty of Rs.90,08,343/- and 4 applicable interest. The petitioners have alternatively sought for permission to file the first appeal under the provisions of Section 35 of the Central Excise Act, 1944 (for short, 'the Excise Act') before the Commissioner of Central Tax (Appeals) S1 and S2, Vinaya Marga, Siddhantha Nagar, Mysore-the appellate authority.
2. According to the petitioners, the first petitioner is in the business of executing civil works contracts for different governments and private undertakings. The first petitioner has registered itself across the country under the applicable Service Tax Acts because the execution of works contracts involves the sale of goods and taxable services, but it is not engaged in manufacture of RMC.
3. The petitioners have narrated the circumstances leading to the present petition thus. 5
3.1 M/s Tata Housing Development Corporation awarded a contract to the first petitioner to construct residential buildings in Bangalore christened Promont Hilltop Residential Project (hereafter referred to as, "the project site"). The first petitioner set up a Concrete Mix (CM) plant at the project site to discharge its contractual obligations. The petitioners transported the CM manufactured at the Project's adjacent building site, and such mix was used exclusively for construction at the site.
3.2 The Superintendent (Preventive), Office of the Commissioner of Central Excise, Bangalore- III Commissionerate, Ministry of Finance, Government of India addressed letter dated 11.01.2016 to the first petitioner asking for details such as name and address of the Projects, copies of agreements/purchase orders, details 6 (quantity/value) of Ready Mix Concrete (RMC) used in the projects and month-wise ledger extracts showing the value and quantity of RMC supplied. The petitioners provided the details on 22.01.2016 while clarifying that it was manufacturing controlled CM at the project site for exclusive use at site and it was not manufacturing RMC.
3.3 The Superintendent (Preventive) by his subsequent Communication dated 27.01.2016 called upon the petitioners to furnish further details as regards the execution of the civil works at the Promont Hillside Residential Project - the project site. The first petitioner again, along with its letter dated 08.02.2016, furnished all the documents reiterating that it had manufactured controlled CM for exclusive captive use at the site. Later, the Superintendent (Preventive) recorded 7 statements of the second petitioner and the first petitioner's another representative between March, 2016 and January 2017.
3.4 The Additional Commissioner of Central Tax (the third respondent) issued show cause notice dated 13.04.2017 to the first petitioner alleging suppression of facts and mis- declaration and calling upon the first respondent to show cause against classifying the concrete mix produced at the project site as RMC denying the benefit of exemption permissible under notification in No. 12/2012-CE dated 17.03.2012. The first petitioner was also called upon to show cause against the demand of duty in a sum of Rs.89,03,343/- and further amounts as penalty under section 11A of the Excise Act extending the period of limitation under the other provisions of such Act.
8
3.5 The first petitioner responded to such show cause notice dated 13.04.2017 by its Response dated 18.07.2017 refuting all allegations of suppression of facts or willful mis-declaration and reiterating that it had manufactured only controlled CM for the purposes of in situ utilization. The CM manufactured by the first petitioner for construction at the project site was not exigible. The petitioners did not receive any communication from the respondents pursuant to their response dated 18.07.2017 until the second petitioner received communication to file his response too, and the second petitioner filed his response on 08.06.2019 reiterating the cause shown by the first petitioner. The petitioners also filed written submissions on 10.06.2019. The first respondent, despite cause shown by the petitioners, issued the Order-in-original confirming the proposal in the show cause 9 notice dated 13.04.2017 proposing confiscation of certain goods.
3.6 The petitioners, on receipt of the Order-in-original, handed over the related papers to their tax consultants with instructions to prepare, finalize and file the first appeal before the appellate authority within the prescribed time under section 35 of the Excise Act. The petitioners were under the bona fide belief that the necessary appeal is filed in time in accordance with law. The petitioners were dismayed when they received the impugned letter dated 03.09.2020 directing the petitioners to pay the excise duty and the penalty with interest. On enquiry with the Tax Consultants, the petitioners learnt that the Tax Consultant by inadvertence and a bona fide error had not filed the necessary first appeal. The petitioners could not file such appeal even within 10 the extended period because the time in that regard had also lapsed by then.
4. The petitioners' case is that this Court must interfere with the impugned Order-in-original in exercise of the extraordinary jurisdiction of the Court under Article 226 of the Constitution of India because such order is issued by the first respondent without jurisdiction. Sri Sandeep Huilgol, the learned counsel for the petitioners, argues that the petitioners can demonstrate that the Order-in-original is without jurisdiction and as such, this Court must, instead of dismissing the writ petition on the ground that the petitioners have not availed the statutory appeal remedy, interfere with the Order-in-original and grant either of the relief claimed by the petitioners. In this regard, Sri Huilgol relies upon the decision of a Division 11 Bench of this Court in Phoenix Plasts Co v. CCT (Appeals-1)1.
5. Sri Huilgol relies upon the decision of the Hon'ble Supreme Court in Larsen and Toubro Ltd. and another v. Commissioner of Central Excise, Hyderabad2 to support the petitioners' contention that the impugned Order-in-original is without jurisdiction. He argues that RMC and CM are two different products and the difference between RMC and CM is in the process of mixing. A manufacturer of RMC installs (i) stone crushers, conveyors, vibrator screens - to segregate different sizes of stone aggregates, (ii) a sand mill - to produce sand from storms, (iii) batching plants in which all aggregates are weighed and controlled by electrical controls and switches, (iv) separate silos - to store cement which is carried to the concrete mixer by a conveyor with automatic weighing gauges, (v) flow 1 2013 (298) ELT 481 (Kar) 2 (2015) 15 Supreme Court Cases Page 455 12 metres to feed water after subjecting it to chemical analysis, (vi) concrete mixer to mix stone aggregates, sand, cement and water, and (vii) transit mixer mounted on a truck chassis for transporting the concrete to the actual site of construction. However, in the present case, the petitioners have set up only a plant for manufacturing CM of required specifications using raw materials like specified size stone chips, sand, cement admixtures et cetera purchased from third party vendors; the petitioners have not installed any stone crusher or sand mill for production of stone aggregates or any specific quality of sand within the site. It is undisputed that the first petitioner, as a civil contractor in discharge of the contractual obligations, has manufactured CM and used such CM at the site entirely for captive use i.e., for construction of residential buildings at the project site. These two circumstances are significant and contradistinguish the manufacture of CM from the manufacture of RMC. The 13 first respondent has failed to appreciate the aforementioned significant aspects.
6. Sri Huilgol emphasizes that if it is established that the petitioner has only produced CM and not RMC and the CM produced is used in situ, the CM is not exigible. In support of this submission, the learned counsel relies upon (a) entry at Serial No. 51 of the notification dated 01.03.1997 in No.4/1997-CA, (b) the Central Board of Indirect Taxes and Customs (CBIC) Circular dated 06.01.1998 and (c) the entry at Serial No. 144 of the subsequent notification dated 17.03.2012 in No.12/2012-CE. The terms of these two notifications dated 01.03.1997 and 17.03.2012 relied upon by Sri Huilgol are similar, and are extracted for immediate reference:
Notification dated 01.03.1997:
Sl No. Chapter or Description of Rate Conditions heading No. Goods or sub-
heading No. 14 51 38 Concrete mix Nil -----
manufactured at the site of construction for use in construction work at such site Notification dated 17.03.2012:
Sl No. Chapter or Description of Goods Rate Conditions heading No. or sub-
heading No. 144 38 Concrete mix Nil -----
manufactured at the site of construction for use in construction work at such site The part of the CBIC clarification dated 06.01.1998 relied upon by Sri Huilgol reads as follows:
"5. A doubt has been raised as to whether concrete mix manufactured at site using large mechanical devices is a form of ready mix concrete.
6. The matter has been examined and concrete mix implies the conventional method of concrete production conforming to the ISI Standard 456-1978, which is produced and used at the site of construction. It is this concrete mixture, 15 manufactured at the site of construction which is fully exempt vide Notification No. 4/97-CE dt. 1.3.97(S.No. 51). It is thus clarified that ready mix concrete or pre- mixed concrete, by its very nature, cannot be manufactured at the site of construction and is brought from the factory of manufacturer for use in construction.
7. In view of the above and keeping in mind the distinction between Ready Mix Concrete and "Concrete Mix" it is clarified that Ready Mix Concrete is an excisable product classifiable under sub-heading 3824.20, chargeable to duty at the appropriate rate whereas "Concrete Mix"
manufacturer at the site of construction for use in construction at such site, is fully exempt vide Notification No. 4/97-CE dt. 1.3.97-(S.No. 51)."
7. Thus, the petitioners' case hinges on the assertion that the installation at the project site for manufacture of CM (which is exempted) is different from the installations for manufacture of RMC, and they have manufactured controlled CM, as civil contractors executing civil works contract, for captive use at site and not for sale. The first respondent, without considering these circumstances, has concluded that 16 the petitioners have manufactured RMC, which is the basis for the impugned Order-in-original/Letter of Demand. This conclusion is contrary to the settled law and wholly erroneous on facts. As the petitioners have only manufactured CM, which is exempt from excise duty, the Order-in-original would be without jurisdiction.
8. Sri. Jeevan J Neeralgi, the learned counsel for the respondents, submits that the Order-in-original is dated 14.06.2019 and the present writ petition is filed in the month of September 2020 i.e., after more than one year from the date of communication of the Order- in-original. The Petitioners, if aggrieved, should have, within 60 days from the date of the communication, impugned the Order-in-original in an appeal before the Commissioner of Central Tax (Appeals) S1 and S2, Vinaya Marg, Siddharthanagar, Mysore under Section 35 of the Excise Act, and if justifiable even beyond the 17 said 60 days but within the next 30 days. In the event, the petitioners had filed such appeal they could have invoked further remedies as envisaged under the subsequent provisions of the Excise Act. The petitioners, who have not availed the statutory remedy, futilely contend that the Order-in-original (and the subsequent letter of demand) is without jurisdiction asserting that the petitioners have only manufactured CM at the project site and they have not manufactured RMC.
9. Sri. Neeralgi relies upon the decision of the Hon'ble Supreme Court in the Assistant Commissioner (CT) LTU, Kakinada and others v. M/s Glaxo Smith Kline Consumer Healthcare Ltd.3 to assert that even if the petitioners can contend that the Order-in-original is without jurisdiction (which is entirely untenable), they should have approached this Court under Article 3 2020 SCC Online SC 440, and is hereafter referred to as, the M/s Glaxo Smith Kline Consumer Healthcare Ltd case 18 226 of the Constitution of India before the expiry of the statutory period contemplated under section 35 of the Excise Act urging either that the Order-in-original is without jurisdiction or is in excess of jurisdiction. The petitioners have not explained the reason for the failure to file such appeal within the statutory period except for blaming the consultant and without detailing the steps taken by them to ensure that the appeal is filed within the statutory period. The writ petition, which is filed beyond the prescribed statutory period and without availing the statutory remedy, must be rejected as not maintainable. Sri. Neeralgi also points out that the Hon'ble Supreme Court has in M/s Glaxo Smith Kline Consumer Health Care Ltd., observed that the decision of the Division Bench of this Court in Phoenix Plasts Co v. CCT (Appeals-1) is wrongly premised, and in this regard he relies upon paragraph 15 of the decision.
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10. As regards the petitioners' contention that the Order-in-original is without jurisdiction because the first respondent has raised a demand ignoring material aspects in respect of a product that cannot be subjected to levy of excise contrary to the relevant notifications/CBIC Clarification and overlooking material circumstances, Sri. Neeralgi submits that first respondent before the issuance of the show cause notice dated 13.04.2017 conducted search operation at the project site and ascertained that the petitioners had installed batching plant consisting of three silos, one mixer for manufacturing concrete mix, one control panel, three aggregates store areas linked to the concrete mixing machine, pipe systems connected to the concrete mixing machine for receiving aggregates and connected to the three silos for cement and water tank. Further, the first respondent, after due opportunity, has recorded the voluntary statement of one of the petitioners' representative, Sri P Vinod. This 20 representative has admitted that the petitioners have installed a batching plant of 45 cubic meters per hour capacity at the project site with an automatic batching plant for more than three (3) years. He has also admitted that the petitioners purchased various aggregates as required from the third-party vendors and as such they did not have a stone crusher or sand mill or vibrator screen; that there are separate silos to stock cement and fly ash from which cement and fly ash are fed to the concrete mixer using a screw conveyor operated with automatic weighing gauges; that chemically treated water stored in a tank is fed to the batching plant as per requirement; that various admixtures like retarders, plasticizers et cetera stored in separate drums are sent to the concrete mixer by suitable pumps; that the concrete mix produced are tested for various grades and strengths; that during the breakdown or maintenance/repair of the plant, the petitioners have purchased RMC from third-party 21 vendors and there is no difference in the quality of the concrete mix manufactured at the site by the petitioners and purchased from third-party vendors. Thus, it is established that the petitioners have used a batching facility to manufacture RMC of precise quality and different grades
11. Sri. Neeralgi submits that these circumstances clearly satisfy the test prescribed by the Hon'ble Supreme Court in Larsen and Toubro Ltd. and another v. Commissioner of Central Excise, Hyderabad supra to distinguish between RMC and CM. It is conclusively established that petitioners manufactured RMC using elaborate batch plants to specific and precise requirements and standards and such mix is exigible, and the contentions that because the petitioners were producing CM as civil contractors for captive use and they did not have stone crusher or vibrators screen or sand mill at the project site do not 22 make a material difference. Therefore, the contention that the Order-in-original is without jurisdiction cannot be countenanced and the petition is liable to be rejected as not maintainable.
12. In rejoinder,4 Sri Huilgol submits that the Hon'ble Supreme Court in Glaxo Smith Kline Consumer Healthcare case has not declared that a petition under Article 226 of the Constitution of India would not be maintainable after the period prescribed for filing statutory appeals but has only declared that the exercise of such jurisdiction must be with self imposed restraint and in the light of the legislature's intendment in prescribing statutory period for filing an appeal. He argues that the decision in Glaxo Smith Kline Consumer Healthcare Ltd case has been accordingly considered by a Division Bench of the High Court of Judicature at 4 The rejoinder submissions by Sri Huilgol and the subsequent submissions by Sri Neeralgi are completed by the learned counsel after the petition was listed on the request of Sri Huilgol for further hearing.
23Madras in W.A. No. 493 of 2010 and CMP No. 1959 of 20215. He submits that the Division Bench was examining the merits of the rejection of a writ petition relying upon the aforesaid decision in Glaxo Smith Kline Consumer Healthcare Ltd, and he draws the attention of this Court to paragraphs 6 and 8 which read as follows:
"6. On a reading of the above extracted paragraphs, it is seen that the Hon'ble Supreme Court, after referring to the decision of the Constitution Bench in the case of Thansingh Nathmal, held that although the power of the High Court is very wide, the court must exercise self imposed restraint and not entertain the writ petition. Further in paragraph 15, the Hon'ble Supreme Court observed that the High Court may accede to such a challenge and can also non-suit the petitioner on the ground that alternative efficacious remedy is available and that be invoked by the writ petitioner. In addition, in paragraph 19, the Hon'ble Supreme Court took note of the fact that when the High Court refuses to exercise the jurisdiction under article 226 of the Constitution of India, it would be necessary for the court to record that there was no case of violation of the principles of natural justice or non-compliance of statutory requirements in any manner".
5 The writ appeal and the petition are disposed of by the Division Bench on 18.2.2021 24 "8. Further, it would be highly beneficial to refer to the celebrated decision of the Constitution Bench of the Hon'ble Supreme Court in the case of Mafatlal Industries Ltd v. Union of India (reported in 1997 (5) SCC
536) wherein it was held that the jurisdiction of the High Courts under Article 226 and that of the Hon'ble Supreme Court under article 32 of the Constitution of India could not be circumscribed by the provisions of the enactment (Central Excise Act) and they would certainly have due regard to the legislative intent evidenced by the provisions of the Act and would exercise their jurisdiction consist provisions of the Act. Further, the Court directed that the writ petition would be considered and disposed of in the light of and in accordance with the provisions of section 11 B of the Central Excise Act and for such a reason, the power under article 226 of the Constitution of India has to be exercised to effectuate rule of law and not for abrogating".
13. Sri Huilgol submits that the opinion that the Hon'ble Supreme Court in Glaxo Smith Kline Consumer Healthcare Ltd has declared (i) that the writ petition cannot be maintained against an Order-in-original if the statutory remedy is not availed and (ii) that the decision of the Full Bench of the Gujarat High Court in Panoli Intermediate (India) Private Ltd. v. Union of India and 25 others and the Division bench decision of this Court in Pheonix Plasts Co. Ltd supra cannot be applied, would be contrary to the settled propositions of law that the jurisdiction under Article 226 of the Constitution of India is an alternative remedy provided by the Constitution (on certain grounds) and not in supersession of the ordinary or statutory remedies. Sri Huilgol, relying upon the decision of the Hon'ble Supreme Court in Sudama Devi versus Commissioner and others6 and Sri Vallabh Glass Works Ltd versus Union of India7, argues that when a person, who could not avail either the ordinary or statutory remedy, approaches the High Court under Article 226 of the Constitution of India on specific grounds, it would be appropriate to ordinarily construe any unexplained delay in filing the petition after the expiry of the limitation prescribed as unreasonable, and subject to this condition, a writ petition can be entertained if it is 6 (1983) 2 SCC 1 7 (1984) 3 SCC 362 26 shown that the impugned order is without jurisdiction. He reiterates that in the present case the petitioners have sufficiently explained the reason for not filing the statutory appeal and demonstrated that the Order-in- Original is without jurisdiction.
14. Sri Huilgol further submits that an opinion that the Hon'ble Supreme Court in Glaxo Smith Kline Consumer Care Ltd has declared that a writ petition which is filed after the expiry of the statutory period cannot be maintained would be contrary to the settled propositions relied upon by him and the Hon'ble Supreme Court8 has held that if there are conflicting views by two coordinate benches, the former view must prevail. As such, the writ petition cannot be rejected solely on the ground that it is not maintainable because the petitioners have not filed statutory appeal. 8 Sundeep Kumar Bafna v. State of Maharashtra [(2014) 16 SCC 623] and National Insurance Co Ltd v. Pranay Sethi [(2017) 16 SCC 680 27
15. The points for consideration would be:
a. Whether the writ petition is liable to be rejected as not maintainable because the petitioners have not filed this petition impugning the Order-in-original within the statutory period prescribed under Section 35 of the Excise Act even if they could demonstrate that the Order-in-original is without jurisdiction ; and 9 b. Whether the first respondent could have classified the concrete mix manufactured by the petitioners at the project site as RMC though the petitioners had not installed Stone crushers with vibrators or sand mill as part of their Batching Plant and the petitioners had manufactured concrete mix as civil contractors for captive use at the site and not for sale.
c. If so, whether the Order-in-original is indeed without jurisdiction and this Court must interfere.
9 If the answer to this question is in the negative, the other submission by Sri. Huilgol would not arise for consideration.28
16. The petitioners could have availed statutory remedy against the impugned Order-in-original under section 35 of the Excise Act if they could invoke such jurisdiction within 60 days from the date of communication of the order or the next 30 days10. However, the petitioners have not filed such appeal. The petitioners' explanation for not filing the appeal is that they had entrusted the papers to their consultants 10 Section 35. Appeals to Commissioner (Appeals): -
(1) Any person aggrieved by any decision or order passed under this Act by a Central Excise Officer, lower in rank than a Commissioner of Central Excise , may appeal to the Commissioner of Central Excise (Appeals) hereafter in this Chapter referred to as the Commissioner (Appeals) within sixty days from the date of the communication to him of such decision or order :
Provided that the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days, allow it to be presented within a further period of thirty days.
(1A) The Commissioner (Appeals) may, if sufficient cause is shown at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing:
Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal 29 with instructions to file the appeal and the concerned were under the bona fide belief that such appeal was filed until the impugned letter of demand dated 03.09.2020 was received. The petitioners, except for vague assertions in this regard, have not furnished the details such as the date of communication of the impugned Order-in-original, the date on which the records were handed over to the consultants, the details of the consultants, and the action taken, if any, for the failure by the consultants to file the appeal. As pointed out by Sri Neeralgi, the petitioners have also not detailed the steps taken by them to ensure that the appeal is filed after the records were handed over, if indeed the records were handed over. The petitioners, who are very superfluous in their explanation of the delay/ failure to avail the appeal remedy, have challenged the Order-in-original on the ground that the same is without jurisdiction asserting that the first respondent, overlooking material circumstances, has 30 classified the CM manufactured at project site for captive use as RMC. The objection as regards maintainability of the writ petition is because of the pronouncement in Glaxo Smith Kline Consumer Health Care Limited.
17. The Hon'ble Supreme Court in this decision has examined the question, "whether the High Court in exercise of its jurisdiction under article 226 of the Constitution of India ought to entertain a challenge to the assessment order on the sole ground that the statutory remedy of appeal against that orders stood foreclosed by the law of limitation". This question has come up before the Hon'ble Supreme Court because the assessee filed a writ petition impugning the assessment order on the ground that it was without jurisdiction and in violation of principles of natural justice though it had unsuccessfully filed a belated statutory appeal against the order of assessment under the Central Sales Tax Act 31 after filing an application for correction of error under the relevant Rules but without impugning either the dismissal of the appeal on the ground that it was beyond the prescribed statutory period or the rejection of the application for correction of error. This writ petition being allowed relegating the assessee before the concerned authority for reconsideration of the matter after a fresh opportunity of personal hearing, the matter is taken up in challenge before the Hon'ble Supreme Court.
18. While examining the aforesaid question in the light of the above facts and circumstances and the decision in Oil and Natural Gas Corporation Limited v. Gujarat Energy Transmission Corporation Ltd and others11, Mafatlal industries Ltd and others versus Union of India and others12 as also other 11(2017) 5 SCC 42 12(1997) 5 SCC 536 and also referred to by the Division Bench of the Judicature of Madras relied upon by Sri. Huilgol 32 decisions, the Hon'ble Supreme Court has delineated the settled propositions such as;
a. that even though the High Court can entertain a writ petition against any order or direction passed/taken by the State under article 226 of the Constitution of India, it ought not to do so as a matter of course when the aggrieved person could have availed alternative remedy in the manner prescribed by law;
b. that although the power of the High Court under article 226 of the Constitution is very wide, the courts must exercise self imposed restraint and not entertain the writ petition if an alternative remedy is available to the aggrieved person;
c. that even the Hon'ble Supreme Court while exercising its plenary jurisdiction under article 142 of the Constitution of India is required to bear in mind the legislative intent and should not render the statutory provision otiose; and what cannot be done by the Hon'ble Supreme Court in exercise of its jurisdiction under article 142 of the Constitution of India, cannot be done by the High Court in exercise of its jurisdiction under article 226 of the Constitution of India though such jurisdiction is wide."
19. In Mafatlal Industries Ltd and others versus Union of India and others13, per majority, the 13 Ibid 33 Constitutional Bench, while examining different significant questions (in the words of the Hon'ble Court, significant questions in all its shades involving the correctness of certain earlier decisions, concept of unjust enrichment, interpretation of Article 265 of the Constitution of India and of the provisions of the Central Excises and Salt Act, 1944 under Customs Act et al) has declared that when a refund of tax/duty is claimed on the ground that it has been collected by misinterpreting or mis-applying the provisions of the relevant act or the rules or regulations or the notifications, such a claim has to be preferred in accordance with the provisions of the respective enactments before the authorities specified thereunder and within the period of limitation prescribed therein, and while the jurisdiction of the High Courts under article 226 of the Constitution of India cannot be circumscribed by the provisions of the said enactments, the Courts will certainly have due regard to the 34 legislative intent evidenced by the provisions of the Acts. The third proposition underscored in the Glaxo Smith Kline Consumer Healthcare Limited echoes this proposition declared by the Constitutional Bench.
20. The Hon'ble Supreme Court in M/s. Glaxo Smith Kline Consumer Health Care Ltd., while underscoring the aforesaid proposition, has held in paragraph 15 as follows, and it has also later examined whether in the facts of the case on hand it could be reasonably opined that the assessee did not have an opportunity and the explanation offered is considered. Paragraph 15 reads as follows:
"We may now revert to the Full Bench decision of the Andhra Pradesh High Court in Electronics Corporation of India Ltd., (supra), which had adopted the view taken by the Full Bench of the Gujarat High Court in Panoli Intermediate (India) Pvt. Ltd. vs. Union of India & Ors.19 and also of the Karnataka High Court in Phoenix Plasts Company vs. Commissioner of Central Excise (Appeal), Bangalore. The logic applied in these decisions proceeds on fallacious premise.
For, these decisions are premised on the logic that provision such as Section 31 of the 1995 Act, cannot curtail the jurisdiction of the High 35 Court under Articles 226 and 227 of the Constitution. This approach is faulty. It is not a matter of taking away the jurisdiction of the High Court. In a given case, the assessee may approach the High Court before the statutory period of appeal expires to challenge the assessment order by way of writ petition on the ground that the same is without jurisdiction or passed in excess of jurisdiction - by overstepping or crossing the limits of jurisdiction including in flagrant disregard of law and rules of procedure or in violation of principles of natural justice, where no procedure is specified. The High Court may accede to such a challenge and can also nonsuit the petitioner on the ground that alternative efficacious remedy is available and that be invoked by the writ petitioner. However, if the writ petitioner chooses to approach the High Court after expiry of the maximum limitation period of 60 days prescribed under Section 31 of the 2005 Act, the High Court cannot disregard the statutory period for redressal of the grievance and entertain the writ petition of such a party as a matter of course. Doing so would be in the teeth of the principle underlying the dictum of a three Judge Bench of this Court in Oil and Natural Gas Corporation Limited (supra). In other words, the fact that the High Court has wide powers, does not mean that it would issue a writ which may be inconsistent with the legislative intent regarding the dispensation explicitly prescribed under Section 31 of the 2005 Act. That would render the legislative scheme and intention behind the stated provision otiose."
The underlining is by this Court 36
21. In the light of the above, this Court must opine that the Glaxo Smith Kline Consumer Healthcare does not lay down the law that a writ petition, which is filed after the expiry of the statutory period for availing the statutory remedy and without availing such remedy, must be rejected as not maintainable. The principle underscored by the Hon'ble Supreme Court is that merely because a party/ an assessee contends that the impugned order (against which a statutory remedy of appeal is provided but is not availed) is without jurisdiction or in violation of the principles of natural justice or is based on misinterpreting or misapplying the statutory provisions, there cannot be interference with such order in exercise of the jurisdiction under article 226 of the Constitution of India, and the interference, even if any in the peculiar facts and circumstances of a particular case, must be made bearing in mind the prohibitions under the statute. The first question is answered holding that this writ petition cannot be 37 rejected merely because a statutory appeal has not been preferred by the petitioners within the prescribed period.
22. This Court, on examining the explanation offered by the petitioners for not filing statutory appeal and because of the absence of the necessary details, has opined in paragraph 16 above that the petitioners are superfluous in their explanation of the delay in availing/failure to avail the appeal remedy. The delay in impugning the Order-in-original, which is not sufficiently explained, must be construed as unreasonable14 and therefore, the writ petition must fail at this threshold bar. This consideration would be distinct and separate from examining the explanation offered for the purposes of condoning the delay which would be in the teeth of the decision of the Hon'ble Supreme Court in Oil and Natural Gas Corporation As laid down by the Hon'ble Supreme Court in Sri Vallabh Glass 14 Works Ltd versus Union of India supra 38 Limited v. Gujarat Energy Transmission Corporation Ltd and others supra
23. Even otherwise, the petitioners' case that the order-in-original is without jurisdiction will have to fail in light of the decision in Larsen and Toubro Ltd. and another v. Commissioner of Central Excise, Hyderabad supra. The Hon'ble Supreme Court has held that "it is the process of mixing the concrete that differentiates between CM and RMC" and has also extracted with approval the summation as regards the difference between the two products in the following words:
"From the literature quoted above it is clear that Ready Mix Concrete is an expression now well understood in the market and used to refer to a commodity bought and sold with clearly distinguishable features and characteristics as regards the plant and machinery required to be set-up for its manufacture and the manufacturing processes involved, as well as its own properties and the manner of delivery. RMC refers to a concrete specially made with precision and of a high standard and as per the particular needs of a customer and delivered to the customer at his site. Apparently due to the large demand resulting from rapid urbanization and pressure of completing 39 projects on time, consumption of RMC has steadily grown replacing the conventional/manual concreting works. Today leading cement companies have entered the field by setting-up RMC plants in which L&T ECC is one. RMC is slowly replacing site or hand mixed concrete because of the distinct advantages due to technology, speed and convenience. Furthermore, absence of the need to deal with multiple agencies for procuring and storing cement, sand, blue metal and water as well as the absence of the need to handle unorganized labour force are factors influencing customers to go in for RMC in preference to CM." In this backdrop, the only question is as to whether RMC manufactured and used at site would be covered by notification. Answer has to be in the negative inasmuch as Notification No. 4 dated March 01, 1997 exempts only 'Concrete Mix' and not 'Ready Made Mixed Concrete' and we have already held that RMC is not the same as CM."
24. Thus, whether a concrete mix manufactured at the site can be classified as RMC will have to be decided based on (1) the plant and machinery set-up for its manufacture, (2) the manufacturing processes involved, (3) the properties of the concrete mix and (4) the manner of delivery. It is undisputed that the petitioners have set-up a batching plant comprising of separate silos and concrete mixer with necessary pumps, piping system and control panel to manufacture 40 concrete mix of required grades and quality as per the contractual terms and the concrete mix manufactured by them was no different from the concrete mix purchased by the petitioner in case of breakdown or maintenance. The petitioners, only because they had not installed either stone crushers with vibrators or sand mill or because they purchased stone aggregates, sand and other raw material from third-party vendors, cannot be permitted to contend that the machinery installed by them and the manufacturing process adopted by them are different and distinct from the machinery installed and process followed for manufacturing RMC. If the petitioners have manufactured RMC, it would be of no significance, given the text of the exemption under the relevant notification and the clarification, that it is used for captive use and not for sale.
41
For the foregoing, the writ petition is rejected concluding that the first respondent has rightly classified the concrete mix manufactured by the petitioners at the project site as RMC and the Order-in- original does not suffer from lack of jurisdiction.
SD/-
JUDGE nv*