Madras High Court
M/S.Super Sales India Ltd vs The Customs on 22 September, 2017
Bench: S.Manikumar, V.Bhavani Subbaroyan
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 22.09.2017
CORAM:
THE HONOURABLE MR.JUSTICE S.MANIKUMAR
and
THE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN
W.P.Sr.No.71173 of 2017
M/s.Super Sales India Ltd.,
(Previously known as
M/s.Super Sales Agencies Ltd.,)
Rep. by its Authorised Signatory .. Petitioner
versus
1. The Customs, Excise and Service Tax
Appellate Tribunal,
Shastri Bhavan Annexe, Chennai-6.
2. The Deputy Commissioner of Central Excise,
Coimbatore III Division,
1237, Elgi Building, III Floor,
Trichy Road, Coimbatore 641 018.
3. The Commissioner of Central Excise (Appeals),
6/7, A.T.Devaraj Street,
Race Course Road, Coimbatore 641 018.
4. The Commissioner of Central Excise,
Chennai-III Commissionerate,
26/1, Mahatma Gandhi Road,
Nungambakkam, Chennai 600 034. .. Respondents
Writ Petition filed under Article 226 of the Constitution of India, praying for a Writ of Certiorari, to call for the records, relating to the impugned order passed by the 1st respondent in Final Order No.40582/2017, dated 03.04.2017 and quash the same.
For Petitioner : Mr.ARL.Sundaresan,
for Mr.Lakshmi Kumaran
ORDER
(Order of the Court was made by S.MANIKUMAR, J.) Writ of Certiorarified Mandamus, is sought for, to quash the order of the CESTAT, Chennai, in Final Order No.40582/2017, dated 03.04.2017. After scrutiny of the case papers, Registry has returned the same, with the following endorsement:
"When there is an appeal remedy available under 35G of Central Excise Act 1944 and Customs Act, 1962 and also as per the order passed by the Hon'ble DivisionBench in W.P.No.36051/2004 (Batch cases) as categorically stated, the Writ Petitions are not maintainable, remedy for the Writ Petition is to only file an appeal before High Court under Section 35G of Central Excise Act 1944 or under Section 130 of the Customs Act 1962 when it applies.
Therefore it may be clarified as to how the Writ Petition is maintainable U/Art. 226 Constitution of India for the reason stated supra."
2. When the writ petition came up for hearing for maintainability on 05.09.2017, a learned single Judge, has minuted as follows:
"This matter is listed today under the caption 'for maintainability'.
2. Registry has raised a doubt as regards maintainability of this writ petition, as the petitioner has challenged a final order passed by the Customs, Excise and Service Tax Appellate Tribunal. It has been pointed out by the Registry that in terms of Section 35G of the Central Excise Act, as against the impugned order, an appeal lies to the Division Bench and therefore, the Registry wanted the petitioner to explain as to how the writ petition is maintainable. On an explanation being submitted by the petitioner on 01.8.2017, still the Registry has a doubt with regard to the maintainability and therefore, the matter is before this Court under the said caption.
3. Heard Mr.Raghavan Ramabadran, learned counsel for the petitioner.
4. The learned counsel for the petitioner has pointed out that in the light of the decision of the Division Bench of this Court in the case of Tiruchitrambalam Projects Ltd. Vs. CESTAT, Chennai [reported in 2016 (43) STR 531], the writ petition is maintainable and also relied upon paragraph 10, which reads as follows:
"Therefore, we are of the considered view that the answer given in paragraph 80 of its decision by the Division Bench in Metal Weld Electrodes, is perfectly correct. But, at the same time, in exceptional circumstances carved out in the second part of paragraph 38 of the decision of the Supreme Court in Raj Kumar Shivhare, the writ petitions are also maintainable."
5. In terms of the above decision, the writ petition is maintainable, as the Division Bench has pointed out that the Hon'ble Supreme Court in the case of Raj Kumar Shivhare Vs. Assistant Director, Directorate of Enforcement [reported in (2010) 253 ELT 3J has carved out certain exceptions. However, the difficulty for this Court to decide on the maintainability is on account of the fact that the Division Bench of this Court, in Thiruchitrambalam Projects Ltd., held that writ petitions cannot be posted before Single Judges and that they have to be posted only before the Division Benches dealing with tax cases.
6. Therefore, the Registry is directed to prepare a note regarding maintainability of the writ petition and place the same before the Division Bench for orders."
3. Thus, W.P.Sr.No.71173 of 2017, is listed before us, for maintainability.
4. Inviting the attention of this Court to Paragraph 44 of the judgment made in Metal Weld Electrodes v. CESTAT reported in 2014 (299) ELT 3 (Mad.), considered in Tiruchitrambalam Projects Ltd. Vs. CESTAT, Chennai reported in 2016 (43) STR 531, wherein, a Hon'ble Division Bench of this Court held that writ petition, against the order of CESTAT, is maintainable and further contending that when CESTAT, Madras, in the case of the petitioner, on the same set of facts, passed two different orders, Mr.ARL.Sundaresan, learned Senior Counsel for the writ petitioner submitted that the instant writ petition, filed against the order of CESTAT, Chennai, is maintainable.
5. Heard the learned Senior Counsel appearing for the petitioner and perused the materials available on record.
6. Point for consideration in the Writ Appeal is, whether the Writ Petition is maintainable under Article 226 of the Constitution of India, without exhausting the alternative remedy, under Section 35G of the Central Excise Act, 1944, let us consider few decisions, on the aspect of availability of an alternative remedy and filing of a writ jurisdiction.
(i) In Union of India v. T.R.Verma reported in AIR 1957 SC 882, the Hon'ble Supreme Court held that it is well settled that when an alternative and efficacious remedy is open to a litigant, he should be required to pursue that remedy and not invoke the special jurisdiction of the High Court, to issue a prerogative writ. Apex Court held that it will be a sound exercise of discretion to refuse to interfere in a petition under Article 226 of the Constitution, unless there are good grounds to do otherwise.
(ii) In C.A.Ibrahim v. ITO reported in AIR 1961 SC 609, H.B.Gandhi v. M/s. Gopinath & sons, reported in 1992 (Suppl) 2 SCC 312 and Karnataka Chemical Industries v. Union of India reported in 1999 (113) E.L.T. 17(SC) = 2000 (10) SCC 13, the Hon'ble Supreme Court held that where there is a hierarchy of appeals provided by the statute, the party must exhaust the statutory remedy, before resorting to writ jurisdiction.
(iii) In A.Venkatasubbiah Naidu v. S.Chellappan reported in (2000) 7 SCC 695, at Paragraph 22, the Hon'ble Supreme Court deprecated the practice of exercising the writ jurisdiction, when an efficacious alternative remedy is available.
(iv) In Sheela Devi v. Jaspal Singh reported in AIR 1999 SC 2859 and Punjab National Bank v. D.C.Krishna reported in 2001 (6) SCC 569, the Hon'ble Supreme Court held that if the statute provides for remedy of revision or appeal, writ jurisdiction should not be invoked.
(v) Further, in the case of National Insurance Co. Ltd., v. Nicolletta Rohtagi reported in (2002) 7 SCC 456, the Hon'ble Supreme Court held that appeal being a product of a statute, it is not open to an insurer to take any plea other than those provided under Section 149(2) of the Act. The said decision of the Hon'ble Supreme Court was followed, in the case of Sadhana Lodh v. National Insurance Co.Ltd., reported in (2003) 3 Supreme Court Cases 524 and held that the right of appeal, is a statutory right and where the law provides remedy by filing an appeal, on limited grounds, grounds of challenge cannot be enlarged, by filing a petition under Articles 226 of the Constitution of India.
7. Material on record further indicates that the issue raised by the petitioner, involves a dispute, in relation to classification, in which event, it is our considered opinion that the appropriate remedy, would be an appeal, provided under the statute. Though the learned Senior Counsel appearing for the petitioner, contended that CESTAT, Madras, has passed two sets of orders on identical facts, that alone would not give rise to a cause to file a writ petition, when there is an effective and alternative remedy, by way of an appeal under Section 35G of the Central Excise Act, 1944. On the issue raised in the writ petition, at this juncture, it is relevant to consider, Section 35G of the said Act, (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment), if the High Court is satisfied that the case involves a substantial question of law.
(2) The Principal Chief Commissioner of Central Excise or Commissioner of Central Excise or the other party aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-Section shall be -
(a) filed within one hundred and eighty days from the date on which the order appealed against is received by the Principal Chief Commissioner of Central Excise or Commissioner of Central Excise or the other party;
(b) accompanied by a fee of two hundred rupees where such appeal is filed by the other party;
(c) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved.
(2A) The High Court may admit an appeal after the expiry of the period of one hundred and eighty days referred to in clause (a) of sub-Section (2), if it is satisfied that there was sufficient cause for not filing the same within that period.
(3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question.
(4) The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question : Provided that nothing in this sub-Section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question.
(5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit.
(6) The High Court may determine any issue which-
(a) has not been determined by the Appellate Tribunal; or
(b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-Section (1).
(7) When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two Judges of the High Court, and shall be decided in accordance with the opinion of such Judges or of the majority, if any, of such Judges.
(8) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it.
(9) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this Section."
8. In Union of India v. Guwahati Carbon Ltd., reported in 2012 (11) SCC 651, after considering a catena of judgments and Section 35G of the Central Excise Act, 1944 and on the facts and circumstances of the case, relating to determination of the assessable value of the commodity in question, for the purpose of levy of duty, under the Central Excise Act, 1944, at Paragraphs 4, 15 and 16, held as follows:
"4. We reiterate that the High Court, under article 226 of the constitution of india, has vast powers as this Court has under article 32 of the constitution of india, but such powers can only be exercised in those cases where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice.
...........
15. In our opinion, the assessee ought not to have filed a writ petition before the High Court questioning the correctness or otherwise of the orders passed by the Tribunal. The Excise Law is a complete code in order to seek redress in excise matters and hence may not be appropriate for the writ court to entertain a petition under article 226 of the Constitution. Therefore, the learned Single Judge was justified in observing that since the assessee has a remedy in the form of a right of appeal under the statute, that remedy must be exhausted first. The order passed by the learned Single Judge, in our opinion, ought not to have been interfered with by the Division Bench of the High Court in the appeal filed by the respondent assessee.
16. In view of the above, we cannot sustain the judgment and order passed by the Division Bench of the High Court. Accordingly, we allow these appeals and set aside the impugned judgment."
It is also worthwhile to extract the judgments considered in Guwahati Carbon Ltd.,'s case (cited supra), "8. Before we discuss the correctness of the impugned order, we intend to remind ourselves the observations made by this Court in Munshi Ram v. Municipal Committee, Chheharta [1979 (3) SCC 83]. In the said decision, this Court was pleased to observe that: (SCC p. 88, para 23) 23. when a revenue statute provides for a person aggrieved by an assessment thereunder, a particular remedy to be sought in a particular forum, in a particular way, it must be sought in that forum and in that manner, and all the other forums and modes of seeking [remedy] are excluded.
9. A Bench of three learned Judges of this Court in Titaghur Paper Mills Co. Ltd. v. State of Orissa [1983 (2) SCC 433], held: (SCC p. 440, para 11) 11. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under article 226 of the Constitution. It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed.
10. In other words, existence of an adequate alternative remedy is a factor to be considered by the writ court before exercising its writ jurisdiction (see Rashid Ahmed v. Municipal Board, Kairana [AIR 1950 SC 163]).
11. In Whirlpool Corpn. v. Registrar of Trade Marks [1998 (8) SCC 1], this Court held: (SCC pp. 9-10, para 15) "15. Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the fundamental rights or where there has been a violation of the principles of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged.
9. Lack of jurisdiction would be ground, for invoking the extraordinary remedy, under Article 226 of the Constitution of India, which is not the one pleaded in this case. In Raj Kumar Shivhare v. Assistant Director, Directorate of Enforcement reported in 2010 (253) ELT 3 (SC), the exceptions carved out are, where there is a lack of jurisdiction of the tribunal to take action or there has been a violation of rules of natural justice or where the tribunal has acted under a provision of law, which is declared ultra vires and in such cases, notwithstanding the existence of such a Tribunal, the High Court can exercise its jurisdiction to grant relief. None of the exception is applicable to the case on hand.
10. On the facts and circumstances of this case, decisions relied on by the learned Senior Counsel for the petitioner in Raj Kumar Shivhare v. Assistant Director, Directorate of Enforcement reported in 2010 (253) ELT 3 (SC) and Tiruchitrambalam Projects Ltd. Vs. CESTAT, Chennai reported in 2016 (43) STR 531, would not lend support to the contention that a writ petition is maintainable. For the reasons, stated supra, the present Writ Petition filed under Article 226 of the Constitution of India, is wholly misconceived and that the same is not maintainable.
11. Hence, writ petition pending in SR stage, is not maintainable and rejected.
(S.M.K., J.) (V.B.S., J.) 22.09.2017 Index: Yes Internet: Yes skm S.MANIKUMAR, J.
AND V.BHAVANI SUBBAROYAN, J.
skm W.P.Sr.No.71173 of 2017 22.09.2017