2011 (7) TMI 778 - HC - Central Excise

Rebate - Differential duty - Notification 46/94-C.E. (N.T.), dated 22nd September 1994 - Rule 12 of the Central Excise Rules, 1944 - According to the Petitioner, the Government of India acting in its revisional capacity had passed an order in its own case on 30th June 1999 in relation to the rebate of duty on ATF provided to flights to Afghanistan, relying upon the executive instructions - The revisional authority in the present case declined to grant to the Petitioner the benefit of the administrative instructions contained in the Manual issued by the Central Board of Excise and Customs - Evidently, though the Notification restricted the grant of rebate to flights to certain specific countries, administrative instructions were issued by the Union Government in the Manual extending the benefit even further - Held that it would be necessary to set aside the impugned order of the revisional authority and to remit the proceedings back for a fresh determination

Summary

Issues:
Challenge to the correctness and legality of an order passed by the Joint Secretary to the Government of India under Section 35EE of the Central Excise Act, 1944 regarding the clearance of Aviation Turbine Fuel (ATF) to aircraft bound for Nepal and the payment of duty.

Detailed Analysis:

1. Notification 46/94-C.E. (N.T.) and Duty Demand:
The Petitioner, an oil corporation, cleared ATF to aircraft bound for Nepal between February 1998 and February 2000 under Notification 46/94-C.E. (N.T.). The dispute arose when notices were issued for payment of full duty at 16% ad valorem on the ATF supplied. Various authorities confirmed the duty demand, leading to a revision application that was rejected in April 2009.

2. Rebate Notifications and Administrative Instructions:
The Government issued Notifications in 1994, 2001, 2002, and 2003 regarding rebates on mineral oil products exported for consumption on aircraft. Administrative instructions extended the concession to countries like Nepal, Afghanistan, and Bhutan. The Petitioner cited previous orders and CESTAT rulings supporting the extension of rebates to ATF supplied to flights to Afghanistan.

3. Judicial Review and Consistency in Government Decisions:
The revisional authority denied the Petitioner the benefit of administrative instructions, citing Notification 46/94. The High Court noted the importance of consistency in the Government's determinations and highlighted the discrepancy between the Notification's restrictions and the broader administrative instructions. The Court set aside the impugned order and remitted the proceedings for a fresh determination, emphasizing the need to maintain consistency and consider the administrative instructions.

4. Conclusion:
The High Court set aside the order dated April 30, 2009, and remitted the proceedings to the revisional authority for a fresh consideration. The Petition was disposed of without costs, emphasizing the necessity of consistency in the Government's decisions and the importance of considering administrative instructions in such matters.