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2022-TIOL-658-HC-MAD-ST
Sir Gujan Builder Vs Designated Committee
ST - SVLDRS, 2019 - Only issue left is to issue Discharge Certificate under Form SVLDRS-4 - When this was asked for by the petitioner by a request dated 07.02.2022, the same has been rejected by the Designated Committee by order dated 22.02.2022 on the ground that since there is no provision to manually process it now, petitioner's request to issue discharge certificate cannot be acceded to; that the only situation where manual processing is possible as per Board Instruction No.01/2021-CX dated 17.03.2021 covers only those cases where the High Court has decided the case in favour of the declarant and remanded the matter back to the concerned Designated Committee for fresh decision - Consequently, Revenue has issued a show cause notice dated 26.11.2019 and that show cause notice is still pending - Challenging the earlier show cause notice dated 26.11.2019 and the present rejection order dated 22.02.2022 this writ petition has been filed.
Held: Reason cited by the respondent through the order dated 22.02.2022 is that manual process can be undertaken only pursuant to the order passed in this regard by the court of Law - The said reason cited by the respondents is totally unsustainable as it is an internal issue of the Designated Committee under the Scheme to go for an alternative mechanism to do it either manually or otherwise and, therefore, for such process, they need not wait for an order from this Court - Court is inclined to dispose of this writ petition by setting aside the impugned order dated 22.02.2022 and giving a direction to the Designated Committee to manually process the request of the petitioner dated 07.02.2022 and issue a Discharge Certificate within four weeks and as a sequel, the show cause notice issued by the Revenue dated 26.11.2019 is also set aside - Petition disposed of: High Court [para 6, 7]
- Petition disposed of: MADRAS HIGH COURT
2022-TIOL-657-HC-DEL-COFEPOSA
Zakir Khan Vs UoI
COFEPOSA - Following issues arise for consideration - (A) Whether the non-supply of certain RUDs and the supply of illegible RUDs, vitiates the subjective satisfaction arrived at by the Detaining Authority; and whether the detention orders passed are resultantly vitiated on the ground of non-application of mind; thereby rendering them invalid and bad in law. & (B) Whether in the event that issue A (supra) is answered in the affirmative, the argument premised on S.5A of the COFEPOSA Act, in the facts and circumstances of the present case will have the effect of saving the detention order from invalidation.
Held:
+ Bench observes that on a specific query from the Court as to why no criminal prosecution has been filed as yet against the Detenus resulting in their release on statutory bail under the mandate of Section 167(2) of the CrPC, no cogent or satisfactory explanation was offered or forthcoming. [para 24]
+ It was fairly admitted before this Court that several RUDs including not only those supplied to the Detenus, but also those on the record with the Detaining Authority are illegible i.e., not readable - Bench is of the view that, as the RUDs; supplied to the Detenus as well as relied upon by the Detaining Authority, in arriving at its subjective satisfaction were admittedly illegible; it has the unnerving consequence of violating the constitutional rights guaranteed to the Detenus. [para 28, 29]
+ In the grounds of detention, strong reliance has been placed upon the statements of the detenus and co-detenus, recorded under the provisions of Customs Act, 1962 - There is a considerable gap of time between the retraction of their statements by the detenus and co-detenus, and the rebuttal thereof by the DRI. This belated rebuttal on the part of the official respondents was relevant and germane and therefore, merited consideration by the Detaining Authority, particularly when extensive reliance was evidently placed upon those statements - Once the Detaining Authority has relied upon the inculpative statements of the co-accused, their retractions assumed great relevance in the factual backdrop of the present case - Consequently, the admissibility of the said statements becomes dubious once there is a retraction, which issue merited consideration, was evidently not afforded to it by the Detaining Authority. [para 32]
+ It is also trite to state that the Sponsoring Authority was under a legal obligation to have placed the said retractions before the Detaining Authority for the latter's subjective satisfaction [para 33]
+ The legal position that emerges on this aspect is that, if the documents are relevant and have a direct bearing on the case, they must be placed before the Detaining Authority for its 'subjective satisfaction'. [para 37]
+ It is trite to say that when a person is detained in pursuance to an order of preventive detention, the statutory authorities are constitutionally charged with the responsibility of ensuring that the grounds of detention, including legible copies of all RUDs and other relevant documents that are considered whilst forming the subjective satisfaction, are provided to the detenu by the Detaining Authority; so as to enable the detenu to make an effective representation to the Advisory Board, as well as to the Detaining Authority. Therefore, the failure and non-supply of legible copies of all RUDs despite of a request and representation made by the Detenus for the supply of the same, renders the order of detention illegal and bad in law; and vitiates the subjective satisfaction arrived at by the Detaining Authority. [para 39]
+ Detaining Authority gravely erred in relying upon illegible documents which is equivalent to non-placement of RUDs - Impugned detention order stands invalidated. [para 40]
+ Had the Detaining Authority himself considered the documents for arriving at subjective satisfaction, rather than adopting any draft grounds of detention, the Detaining Authority would have been alive to the fact that several RUDs placed before it were wholly illegible. The specific contention canvassed is that the subjective satisfaction of the Detaining Authority, which is condition precedent for issuance of the Detention Order, is in the circumstance vitiated for non-application of mind. If the condition precedent for issuance of a detention order is not satisfied, then such an order cannot be saved even by Section 5A of the COFEPOSA. Order of detention was passed in a tearing hurry without due application of mind. [para 42, 45]
+ It is axiomatic that it would be humanly impossible for the Detaining Authority to scrutinize 977 pages of documents and formulate the grounds of detention and thereafter pass the detention order on 26.11.2017 within a day and a half that too against two detenus.
+ The paucity of time for the Detaining Authority to himself consider the voluminous documents to form its subjective satisfaction, and thereafter to formulate lengthy grounds of detention, rather than merely approving draft grounds of detention, also tilts the scale in favour of the Detenus. [para 45]
+ In cases where orders of detention fail on the ground that the subjective satisfaction of the Detaining Authority is vitiated owing to non-application of mind; the protection afforded qua severability of grounds stipulated under the provision of 5A of the COFEPOSA Act, are neither attracted nor available, in law. [para 51]
+ Detention orders are hereby set-aside and quashed. The detenus are directed to be set at liberty forthwith unless their custody is required in connection with any other case - Writ petitions are accordingly allowed. [para 53]
- Petitions allowed: DELHI HIGH COURT
2022-TIOL-381-CESTAT-BANG
ABB India Ltd Vs CCE & ST
CX - Appellant imports AC/DC drives, Low voltage Panels/ Switchgear and parts, Air Circuit Breakers (ACB), Miniature Circuit Breakers (MCB), Moulded Case Circuit Breakers (MCCB), switch fuse units and Motor Starters classifiable under Chapter heading 8536in bulk; discharges CVD; on receipt of the goods at the warehouse, the baby boxes are removed from the Master box for conducting physical tests on the products; thereafter, the goods are packed in baby boxes and packed in a separate carton box/ Master box; labels are affixed on both the baby and the master boxes; the Appellant discharges excise duty at the time of clearance of goods from their factory, as the activity undertaken at their factory amounts to manufacture in terms of Section 2(f)(iii) of the Central Excise Act, 1944 read with Sl. No. 93 of the Third Schedule to the Central Excise Tariff Act - The packages of the goods bear a declaration that the same are meant for industrial consumers; packages weighing less than 25 kg are cleared on payment of excise duty on the MRP basis and packages weighing more than 25 kg are cleared on payment of excise duty on the transaction value under Section 4 of the Central Excise Act, 1944 -Revenue was of the view that the appellants were wrongly clearing their final products to non-industrial consumers i.e. dealers/channel partners by paying duty on transaction value u/s 4 instead of payment u/s 4A of the CEA - On receipt of Audit's letter, appellants paid differential duty with interest in respect of goods weighing less than 25 kg and contested that s.4A is not applicable to goods weighing more than 25 kg - Demands were issued dated 15.07.2013 and 01.05.2013 proposing to recover differential duty of Rs.1,28,81,098/- and Rs.3,84,50,665/- for the period April 2011 to March 2012 and April 2012 to March 2013 - As the charges were confirmed by the CCE, LTU, Bangalore, the present appeal.
Held:
+ Crux of the appellant's argument is that the impugned goods are meant for industrial consumers only and a clear mention of the same is made on the packages; it is not the case of the department that the impugned goods are sold to consumers and are used by individual consumers; the very nature of the goods and the use as seen from the Technical Literature, would indicate that the goods cannot be used by individual consumers; though the word consumer is not defined either in the Customs Act or in the Legal Metrology Act or Rules thereof, judicial pronouncements have given the scope of the meaning of the term. From the same, it is very clear that the impugned goods cannot be held to be intended for individual users. [para 14]
+ The department's contention is that the exclusion from the applicability of the Rules [Legal Metrology Packaged Commodity Rules] would be available only when the impugned goods are sold by the appellant-manufacturer directly to industrial consumers. The arguments of the appellants is that only for the reason that the impugned goods are sometimes not sold directly and are sold through channel partners, does not take away the nature of the goods of being that of industrial use. The very nature of the goods indicates that the goods are not for use by any individual consumer. The product is only for industrial use and a declaration to the same is also made on the packages whether it is less than 25 kg or more than 25 kg and whether they are sold directly to the industrial consumers or through channel partners. [para 17]
+ It is not disputed that the impugned goods are intended for industrial consumers; the endorsement that they are for industrial use only is made on the packets and that they weigh more than 25 kg.
+ The contention of the department is that when the clearance is through the channel partners, they are not excluded from the provisions of Legal Metrology Rules/Act. The dealer is not an individual consumer and the goods are routed through them to the industrial consumers. The department had no objection in case of very same goods cleared directly to the industrial consumers.
+ Such a treatment by the department defies logic as the nature of the goods is not changed just by the way they are sold. The characteristics, the usage and the users are not changed.
+ High Court of Karnataka [Ewac Alloys Ltd. - 2011-TIOL-924-HC-KAR-CX ] has dealt with this issue in an elaborate manner and have concluded that routing of the goods through dealers or intermediaries would not change the nature of the goods as long as they are not put to use by individual consumers. Going by the Technical Literature and the submissions of the appellant, it is evident that the goods are for industrial use only. Department has not shown any contrary evidence to show that the goods are used by individual consumers.
+ Moreover, the appellants have contended that the amendment carried out in 2015, to include the sales through dealers also, was by way of substitution and that it has to be construed as if the words had been written into the Act or Rules ab initio .
+ Held that the impugned goods having more than 25 kg in weight, are to be treated as to be meant for industrial use, notwithstanding the fact that some of the sales are routed through channel partners. [para 18]
+ Department has also not made out any case for invocation of extended period. [para 19]
Conclusion:
(i) Impugned goods, in packages having weight more than 25 kg are not chargeable to duty under Section 4A, only for the reason that they are sold through channel partners; differential duty demanded on this count is set aside.
(ii) All other demands, if any, within normal period are confirmed.
(iii) Penalty is set aside.
- Appeal partly allowed: BANGALORE CESTAT |
