Karnataka High Court
The Kasturba Medical College vs The Union Of India on 4 January, 2018
Author: Vineet Kothari
Bench: Vineet Kothari
1/29 R
IN THE HIGH COURT OF KARNATAKA, BENGALURU
DATED THIS THE 4TH DAY OF JANUARY 2018
BEFORE
THE HON'BLE Dr.JUSTICE VINEET KOTHARI
WRIT PETITION No.13285 OF 2015 (T-TAR)
C/W
WRIT PETITION No.12122 OF 2015 (T-RES)
W.P.No.13285/2015
Between:
1. The Kasturba Medical College
Madhav Nagar, Manipal 576 104.
Represented by its Additional Dean
Dr.Poornima Baliga.
2. The Manipal University, Manipal
(Formerly known as Manipal Academy
of Higher Education), Madhav Nagar
Manipal 576 104.
Represented by its Registrar
Dr.G.K.Prabhu. ...Petitioners
(By:Mr.N.Anand, Advocate for
Mr.K.S.Ravi Shankar, Advocate)
And:
1. The Union of India
Rep. by Secretary
Ministry of Health & Family Welfare
Nirman Bhavan
Maulana Abul Kalam Azad Road
New Delhi 110 011.
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The Kasturba Medical College & Others Vs.
The Union of India & Others.
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2. The Director General
Directorate General of Health Services
Nirman Bhavan
Maulana Abul Kalam Azaad Road
New Delhi 110 011.
3. The Deputy Director General
Directorate General of Health Services
Nirman Bhavan
Maulana Abul Kalam Azaad Road
New Delhi 110 011.
4. The Senior Regional Director
Regional Office for Health & Family Welfare
Ministry of Health & Family Welfare
2nd Floor, 'F' Wing, Kendriya Sadan
Koramangala, Bengaluru 560 034.
5. The Commissioner of Customs
New Custom House, Panambur
Mangalore 575 010.
6. The Deputy Commissioner of Customs
New Custom House, Panambur
Mangalore 575 010.
7. The Union of India
Rep. by Secretary (Revenue)
Ministry of Finance
128-A, North Block
New Delhi 110 001. ...Respondents
(By:Mr.Gururaj Yadravi, Advocate
for R1 to R4 & R7)
This Writ Petition is filed under Articles 226 & 227 of
the Constitution of India praying to call for the records from
the R3 and quash the order dated 23.1.2015/3.2.2015
passed by the R3 vide Annexure-A, as being illegal and
untenable in law and etc.
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The Union of India & Others.
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W.P.No.12122/2015
Between:
The Medical Relief Society for South Kanara
Madhav Nagar, Manipal 576 104.
A Society registered under the
Societies Registration Act, 1860
Represented by its Joint Secretary
Dr.G.K.Prabhu. ...Petitioner
(By:Mr.N.Anand, Advocate for
Mr.K.S.Ravi Shankar, Advocate)
And:
1. The Union of India
Rep. by Secretary
Ministry of Health & Family Welfare
Nirman Bhavan
Maulana Abul Kalam Azad Road
New Delhi 110 011.
2. The Director General
Directorate General of Health Services
Nirman Bhavan
Maulana Abul Kalam Azaad Road
New Delhi 110 011.
3. The Deputy Director General
Directorate General of Health Services
Nirman Bhavan
Maulana Abul Kalam Azaad Road
New Delhi 110 011.
4. The Senior Regional Director
Regional Office for Health & Family Welfare
Ministry of Health & Family Welfare
2nd Floor, 'F' Wing, Kendriya Sadan
Koramangala, Bengaluru 560 034.
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5. The Commissioner of Customs
New Custom House, Panambur
Mangalore 575 010.
6. The Deputy Commissioner of Customs
New Custom House, Panambur
Mangalore 575 010. ...Respondents
(By:Mrs.K.Sarojini Muthanna, Advocate
for R1 to R4
Mr.N.R.Bhaskar, Advocate for R5 & R6)
This Writ Petition is filed under Articles 226 & 227 of
the Constitution of India praying to call for the records from
the R3 and quash the order dated 23.1.2015 passed by the
R3 vide Annexure-A, as being illegal and untenable in law
and etc.
These W.Ps. coming on for Final Hearing this day, the
Court made the following:-
ORDER
Mr.N.Anand, Advocate for Mr.K.S.Ravi Shankar, Advocate for Petitioner Mr.Gururaj Yadravi, Advocate for R1 to R4 & R7 Mrs.K.Sarojini Muthanna, Advocate for R1 to R4 Writ Petition Nos.13285/2015 and 12122/2015 are being disposed of by this common order.
2. The petitioners in these two Writ Petitions are aggrieved by the impugned order Annexure-A dated 23.1.2015 passed by the Deputy Director General Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
5/29 (Medical) in the Directorate General of Health Services, Ministry of Health and Family Welfare, New Delhi, revoking the Custom Duty Exemption Certificate (CDEC) issued in favour of the petitioner-Hospitals under the Notification No.64/88-Cus. dated 01.03.1988 for import of certain medical equipments exempt from customs duty.
3. The petitioner-Hospitals imported certain medical equipments from out of India availing an exemption from customs duty under the said Notification. The said exemption was given to the petitioner-Hospitals from customs duty subject to the conditions as stipulated in the said Custom Notification No.64/88-Cus. dated 1.3.1988, which, inter alia, required the petitioner-Hospitals to provide free medical treatment on an average to 40% of outdoor patients and 10% of indoor patients. There were certain other conditions also in the said Custom Notification, Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
6/29 which was issued on 1.3.1988 and was later rescinded on 1.3.1999.
4. The impugned order inter alia referring to the decision of the Division Bench of this Court dated 19.7.2011 in Writ Appeal Nos.2369-2370/1999 and other connected Writ Appeals [The Kasturba Medical College & Others Vs. The Union of India & Others] stated that since the petitioner-Hospitals did not file their Affidavits opting for an alternative scheme evolved by the Division Bench of this Court dated 19.7.2011 despite an opportunity given to them and they have failed to give relevant evidence before the Authority for having satisfied the conditions of exemption from customs duty under the said Notification No.64/88- Cus. dated 1.3.1988, therefore, the said CDECs given to them were liable to be revoked and consequently, the customs duty exemption was withdrawn and demand for customs duty was raised by the respondent-
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7/29 Commissioner of Customs, Mangalore vide Annexure-B dated 2.3.2015 to an extent of `4,52,30,472/-. The relevant portion of the impugned order Annexure-A dated 23.1.2015 passed by the Deputy Director General (Medical) in the Directorate General of Health Services, Ministry of Health and Family Welfare, New Delhi is quoted below for ready reference:-
"In this connection, the Directorate wrote letters to the Additional Solicitor General (ASG) and Government Counsel (GC) to find out whether any of the petitioner hospital has opted for it or not. But none of the hospitals opted for it; the Directorate was directed by the Hon'ble Court to give opportunity to the petitioners on the lines of judgement passed by Supreme Court on 24.10.2007 in Sir Ganga Ram Trust Society's case.
A personal hearing was held under the chairmanship of Dr.(Prof.) B.L.Sherwal, Deputy Director General (M) on 05.05.2014 & 06.05.2014 at Senior Regional Director (H&FW)'s office in Koramangala, Bangalore to discuss the matter relating to medical equipments batch cases in Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.8/29
writ appeal Nos.2369-2370/1999 and other writ petitions filed by KMC Group of hospitals and others before the Hon'ble High Court of Karnataka at Bangalore.
There were 22 representatives of different hospitals, who came fro the hearing. They were heard by Dr.(Prof.) B.L.Sherwal, DDG(M), DGHS, Dr.Bina R, Sawhney, Add.DDG, DGHS and Dr.N.R.Suresh, Sr.Regional Director (H&FW), Bengaluru along with 02 representatives of customs department, Shri M.K.Madhyastha, Superintendent of customs & Shri V.Prabhakara, Inspector of customs.
In view of the above, a CDEC committee meeting was held on 10.06.2014 in DDG(M)'s chamber at Nirman Bhawan, New Delhi in which the minutes of the CDEC meeting were approved. It was decided that keeping with the principle of Natural Justice the Directorate has given an opportunity to be heard to all the petitioner hospitals before passing the order. Some of the hospitals have asked for time to substantiate their claim that they are fulfilling the post import conditions. They were given 15.07.14 as cut-off date for submitting the records.
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Since then none of the appellants/petitioners have submitted any documentary proof in support of the claim. The Petitioner had enjoyed the fiscal benefits of exemption given by the Notification No.64/88- Cus. dated 01.03.1988 at the time but did not abide by the Undertaking given in an affidavit at the time of issue of CDECs causing loss of revenue to the public ex-chequer. Therefore, this Directorate/Department of Health has come to the conclusion that all the CDECs issued to the above institutions are hereby withdrawn and cancelled.
This issues with the approval of the competent authority.
5. It would be appropriate to quote the relevant portions of the judgment of Division Bench of this Court dated 19.7.2011 in Writ Appeal Nos.2369-2370/1999 and connected writ appeals by which painstakingly, the Division Bench of this Court headed by Hon'ble Mr.Justice J.S.Khehar, as his Lordship then was, examined all the relevant aspects of the matter and by Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.10/29
way of a concession, evolved an alternative scheme for maintaining and continuing the exemption from customs duty given to these Hospitals, departing from the conditions relaxing them further as laid down in the Notification No.64/88-Cus. dated 1.3.1988 by alternatively stipulating that instead of 40% poor patients being treated free of cost under the Notification No.64/88-Cus. dated 1.3.1988, even if the petitioner-Hospitals undertake to provide free services to 20% of the outdoor and indoor patients for a period of 20 years commencing from 1.1.2012, they would continue to have the said exemption of customs duty. The said Scheme evolved by the Division Bench of this Court was made subject to, the approval by the Central Government on or before 31.10.2011 and if either (i) such Affidavits opting for the alternative Scheme was not furnished by the petitioner-Hospitals or (ii) such alternative Scheme was not approved by the Central Government in both the cases, Authorities Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.11/29
concerned were left free to take action against the Hospitals for recovery of customs duty in question revoking the exemption given under the Notification No.64/88-Cus. dated 1.3.1988. The relevant portions of the said judgment of Division Bench of this Court is quoted below for ready reference:-
7. Keeping in mind the aforesaid aspects, in conjunction with the suggestions made at the hands of the learned counsel for the appellants/petitioners herein, and with the approval of the Additional Solicitor General of India, we have drawn a proposed alternative scheme, as a substitute for the proceedings initiated by the respondents. This proposed alternative scheme would provide succour to the poor amongst the general public, just in the same manner as the original notification dated 01.03.1988. On the other hand, if adopted by the appellants/petitioners herein, it would entail no further action against them under the original notification dated 01.03.1988.
The terms of the proposed alternative policy, as also, the reasons for each of the terms, are being expressed hereunder:-
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Firstly, the appellants would provide free inpatient treatment for atleast 20% of their inpatients, annually. Inpatient treatment is treatment requiring invasive surgery. Free inpatient treatment would include medical, surgical and diagnostic procedures, besides boarding and lodging, to the concerned patient. The original notification depicted such free treatment only for 10% of the inpatients. The instant enhancement to cover 20% of all annual inpatients, is on account of the fact, that it has been considered appropriate to do away with free outpatients' treatment, since it is virtually impossible to verify records for such large number of patients, not only on the issue of their eligibility (under the original scheme), but also in respect of treatment rendered. In case of a shortfall in a particular year, the principle of carry-forward will be adopted, to provide free medical treatment to BPL card-holders, for the following years (including the years after the expiry of the period of 20 years), till the short fall is satisfied. In case, any of the hospitals have sister/peripheral hospital(s), it shall be open to such hospitals to satisfy the obligation of 20% free inpatient treatment, by providing medical treatment in any of their sister/peripheral hospital(s).
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Secondly, the original notification dated 01.03.1988 envisaged free treatment only for persons whose family income was less than Rs.500/- per month. It may be difficult for hospitals to find even a few patients annually, who satisfy the aforesaid criteria. For the proposed alternative scheme, we consider it just and appropriate to extend the benefit of free medical treatment to all BPL (below poverty line) card-
holders. The instant change would be realistic, and would enable the concerned hospitals to carry out their annual obligations effectively, under the proposed alternative scheme.
Thirdly, the benefits under this scheme would be operational for a period of 20 years commencing from 01.01.2012, wherein, each hospital would provide free medical facilities to inpatients as already noticed above. In determining the number of inpatients entitled to free medical treatment, reference shall be made to the total inpatients treated at the hospital during the preceding year; 20% thereof shall constitute the number of patients who would be entitled to free treatment in the year in question. The same principle will be adopted annually, in each succeeding year. Wherever, there is an expected shortfall in a particular year, it shall be open to the Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
14/29 hospital(s) in question to require government hospitals, to refer BPL card-holders, for free inpatient treatment.
Fourthly, hospitals seeking the benefit of the proposed modified scheme, would announce through notices affixed at prominent places at the hospital, the facility of such free medical inpatient benefits, to persons who possess BPL cards. Due publicity shall also be provided on 'Prasar Bharathi' by respondent No.1. Simultaneously, press releases shall be issued by the State of Karnataka, periodically informing the general public of the free medical inpatient facility, available at the hospitals in question. Fifthly, all hospitals concerned shall maintain complete records and details, to identify the beneficiaries under the modified scheme, as also, the details of the treatment rendered to them. The Director General, Health Services, Government of India, or an agency nominated by him, will have the liberty, to carry out quarterly inspections, so as to ascertain the veracity of the records maintained by the concerned hospitals. Records shall be maintained, so as to be available for inspection for a period of one year. During an inspection it shall be open to the concerned authority, to scrutinize Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
15/29 records, pertaining to a period of one year preceding the inspection in question.
8. We are of the view, that the proposed alternative scheme should be placed for consideration before the Central Government by the Additional Solicitor General of India, who represented the Central Government in this bunch of cases. The Central Government shall take a decision thereon, in terms of the spirit of the original notification dated 01.03.1988, and the instant order, in consultation with the Additional Solicitor General of India. The Central Government shall take its decision, one way or the other, by 31.10.2011.
9. Such of the appellants/petitioners who desire to be governed by the proposed alternative scheme, shall file affidavits within four weeks from today, with the Director General, Health Services, Government of India, consenting to be governed by the proposed alternative scheme. Those of the appellants/petitioners who have filed an affidavit in the terms referred to herein-above, would not be proceeded against in furtherance of the earlier notification dated 01.03.1988. They would be entitled to the return of their Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
16/29 machinery unconditionally; they would also be entitled to refund of customs duty, if any, deposited by them; all bonds and bank guarantees (or the like) shall be returned to the concerned parties on or before 31.12.2011, which will be deemed to have been cancelled on the exercise of option and the acceptance of the proposed alternative scheme. In sum and substance, the proceedings initiated against hospitals agreeing to be regulated by the proposed alternative scheme, shall come to an end.
10. Such of the hospitals who do not file their affidavit(s) in the manner expressed herein- above, shall be proceeded against by the concerned competent authority in consonance with the order passed by the Supreme Court on 24.10.2007 in Sir Gangaram Trust Society and another vs. Union of India and others (Civil Appeal No.7284/2005). Likewise, if the proposed alternative scheme is not approved by the Central Government by 31.10.2011, those who have opted for the proposed alternative scheme, shall also be proceeded against by the concerned competent authority in consonance with the order passed by Supreme Court on 24.10.2007 in Sir Gangaram Trust Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
17/29 Society's case (supra). In such of the matters which have to be proceeded with, in terms of the order passed by the Supreme Court, we hope and expect, that the final orders shall be passed within six months from today. This is imperative, as we are informed, that in many cases proceedings under the notification dated 01.03.1988 came to be initiated 18 years ago.
6. It appears that the Central Government did not take any decision in the matter either approving or not approving such alternative scheme evolved by the Division Bench of this Court, nor the petitioner- Hospitals filed the Affidavits opting for the said alternative Scheme and while the matter rested there, in 2014, the Addl. Deputy Director General (BRS), in the Directorate General of Health Services issued a notice to the petitioner-Hospitals Annexure-U dated 15.4.2014 providing an opportunity to appear before the Deputy Director General (Medical) in his Chambers at Bengaluru only on 5th and 6th of May 2014 to satisfy as to whether they complied with the conditions of grant of Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
18/29 exemption under the Notification No.64/88-Cus. dated 1.3.1988.
7. The petitioner-Hospital in W.P.No. 13285/2015 appears to have filed a reply thereto before the Regional Director, Health & Family Welfare, Kendriya Sadana, Koramangala, Bangalore, vide Annexure-V dated 4.7.2014 alongwith certain details of the patients treated by them in Kasturba Medical College, Manipal and Kasturba Medical College, Mangalore, during the period 2005 to 2014.
8. The arguments of learned counsel for the petitioner, Mr.N.Anand before this Court is that while passing the impugned order Annexure-A on 23.1.2015, the respondent-Deputy Director General (Medical) did not take into account the said reply and the explanation furnished by the petitioner and has illegally revoked the exemption from customs duty given to the petitioner Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
19/29 revoking the CDECs as well. Aggrieved by that, the petitioners are before this Court.
9. The Learned counsel for the petitioner also relied upon certain judgments to support his contention that the principles of natural justice have been breached in the aforesaid manner and consequently, the impugned order deserves to be quashed.
10. On the other hand, the learned counsel for the respondent-Union of India, Ms.K.Sarojini Muthanna has supported the impugned order and has urged before the Court that the petitioners have failed to adduce any evidence before the concerned Authority for satisfying the conditions of exemption under the Notification No.64/88-Cus. dated 1.3.1988, despite an opportunity given to them and CDECs of 392 Institutions/Hospitals out of 396 beneficiant Institutions were revoked, who misused the said exemption from customs duty by not satisfying the Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
20/29 conditions thereof by providing free medical treatment to the poor sections of the Society.
11. Though the learned counsel for the respondent-Union of India was unable to point out before this Court any specific order or stand taken by the respondent Union of India, despite specific Court's query, in view of the directions of the Division Bench of this Court in the judgment dated 19.7.2011 about the approval of alternative scheme evolved by the Division Bench of this Court, she however submitted that the said judgment itself permitted that if the said alternative scheme was not approved by the Central Government Authorities concerned before 31.10.2011, they could proceed against the petitioner-Institutions and other similarly situated Institutions for revocation of CDECs or withdrawal of exemption from customs duty and that is why he proceedings were undertaken in the year 2014 by issuing the notice vide Annexure-U dated Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
21/29 15.4.2014 and this has finally resulted in the impugned order Annexure-A dated 23.1.2015.
12. The learned counsel for the respondent- Union of India was also not able to point out any specific consideration of the reply filed by the petitioner- Institution vide Annexure-V dated 4.7.2014 in whose Office, the Deputy Director General (Medical) was to consider the case of petitioner-Institutions on 5th and 6th of May 2014 as stipulated in the notice Annexure-U dated 15.4.2014. There is no mention of the said reply Annexure-V dated 4.7.2014 in the impugned order Annexure-A dated 23.1.2015 also.
13. I have heard the learned counsels for the parties at length and perused the records.
14. Beyond a pale of doubt, the provisions relating to exemption from tax or duties have to be strictly construed and except upon satisfaction of the Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
22/29 conditions for grant of such exemptions stricto sensu, the exemption from customs duty cannot be given by way of largesse to the beneficiaries, like Hospitals and Medical Institutions in the present case.
15. It is indeed unfortunate that in a batch of cases of this nature, including those of the petitioner- Institutions having been decided by the Division Bench of this Court in Writ Appeals and certain Writ Petitions, despite a concession extended by the Division Bench of this Court, upon agreement of learned counsels on both sides, and even deviating from the original terms and conditions of grant of such exemption under the Notification No.64/88-Cus. dated 1.3.1988 in the judgment dated 19.7.2011 in Writ Appeal Nos.2369- 2370/1999 and connected writ appeals, the petitioners, for the reasons best known to them, did not file their Affidavits giving their option for such alternative Scheme evolved by the Division Bench of this Court.
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23/29 There is no document on record to establish it nor it is a contention raised before this Court. That shows lack of bona fides on the part of the petitioners. It is equally unfortunate for the Union of India and the concerned Department or the Authority, who were to take a call and respond to the said alternative scheme evolved by the Division Bench of this Court, they maintained a stony silence in the matter, showing scant regard for the directions of this Court.
16. Be that as it may, the situation as per the terms of Division Bench's judgment in these circumstances thus reverted back to the conditions as stipulated in the Custom Notification No.64/88-Cus. dated 1.3.1988 and therefore, satisfying of the conditions of that Notification stricto sensu became sine qua non for the petitioners to establish before the concerned Authorities.
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17. A bare perusal of the impugned order Annexure-A dated 23.1.2015, the relevant part of which is quoted above, would indicate that though 22 representatives of different Hospitals were present in the personal hearing before the Deputy Director General (Medical) on 5th and 6th of May 2014, including the present petitioners but none of them submitted any documentary proof in support of their claim of exemption establishing with the relevant record and evidence that they have actually provided 40% of services to the poor sections of the Society free of cost. The burden of proof obviously was upon the persons claiming such exemption to prove and satisfy the conditions of exemption and it could be proved only with the relevant evidence.
18. The representative of the present petitioners before this Court are also said to have personally attended these hearings before the respondent-Deputy Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
25/29 Director General (Medical) on 5th and 6th of May 2014, but had failed to establish with the relevant evidence before the concerned Authority referring to its reply Annexure-V dated 4.7.2014 that it really complied with the conditions of exemption, in letter and spirit with data and record before the concerned Authority. If it is factually an incorrect position noted by the said Deputy Director General (M) in the impugned order that none of the appellants/petitioners have submitted any documentary proof in support of the claim, the petitioners could have immediately approached the said Authority pointing out the existence of reply Annexure-V dated 4.7.2014 on its own record with the data given therein. But again there is nothing on record from the side of the petitioners to establish any such approach by the petitioner to the respondent Authority in this regard and therefore, there is nothing on record to believe the stipulation in the impugned order that none of the appellants/petitioners have submitted any Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
26/29 documentary proof for the exemption claimed in discharge of their burden of claim of exemption by satisfaction of conditions ex post facto availing such exemption while importing such medical equipments by adducing the relevant evidence.
19. The facts stated in the impugned order Annexure-A dated 23.1.2015 that CDECs (Exemption Certificates) issued to as many as 392 out of 396 Institutions were revoked is a glaring one. It reflects a gross abuse of such customs duty exemption given to the petitioner-Hospitals and other Institutions. Exemption from tax or customs duty is a burden on the public Ex-chequer or public revenue and to that extent, the public loses its money in favour of the beneficiary institutions. Therefore, it is all the more necessary that a strict, meticulous and complete compliance of conditions with the relevant and cogent evidence is proved beyond doubt before the concerned Authorities.
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27/29 A casual, cavalier or compliance by a paper formality is not enough to allow such Institutions to avail exemption under the said exemption notifications. The very purpose of such exemption will be defeated if the conditions are allowed to breached with impunity and then glossed over by a paper exercise in the name of submitting of a so-called reply furnished by the petitioner in the present case, Annexure-V dated 4.7.2014 , which does not inspire any confidence. The failure on the part of the petitioner to bring forth the said reply and the relevant data with evidence before the concerned Authority during the course of personal hearing on 5th and 6th of May 2014, speaks volumes against the petitioner-Institutions and shows the lackadaisical manner in which it sought to fortify its claim for exemption of customs duty in the aforesaid manner.
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20. The gross abuse of customs duty exemption by these Institutions and as many as 392 Institutions out of 396 given such exemption lost their CDECs, defeats the very purpose for which such exemption was given, for the avowed purpose of providing free medical aid to the poor sections of the Society.
21. The petitioners, therefore, do not deserve any liberal or sympathetic view in the matter which is even otherwise prohibited by the settled canons of interpretation of taxing statutes or exemption Provisions, viz., to strictly construe the same.
22. This Court does not find any illegality, perversity or arbitrariness in the impugned order passed by the respondent-Authority which could be quashed on the anvil of Article 14 of the Constitution of India. There is no breach of principles of natural justice, as the petitioners and the whole lot of them were provided adequate opportunity to establish their Date of Order -04-01-2018 W.P.No.13285/2015 c/w W.P.No.12122/2015 The Kasturba Medical College & Others Vs. The Union of India & Others.
29/29 claims, but they not only failed to avail such opportunity before the concerned Authority, but the concerned Authority noted that despite personal presence of 22 representatives, none of them have produced any documentary proof including the representatives of petitioner-Hospital. This not only surprises and shocks the conscience of this Court as to the nonchalant manner in which the petitioner- Institutions took their exemption from customs duty for granted, without satisfying the conditions therefor.
23. The Writ Petitions thus being devoid of any merit are liable to be dismissed and they are accordingly dismissed. No order as to costs.
Sd/-
JUDGE VGR