2016 (7) TMI 983 - HC - Central Excise

Maintainability of writ petition - alternative appellate remedy - demands of excise duty and customs duty - petitioner submitted that, (i) the Commissioner acted without jurisdiction; (ii) Although the petitioner had responded to the show cause notice dated October 7, 2013 by submitting a detailed written reply, the Commissioner observed that the petitioner had failed to respond;The petitioner was not asked to show cause notice under section 114A of the 1962 Act and by imposing penalty thereunder, it was practically condemned unheard. Held that - The argument of Mr. Roy, insofar as the jurisdictional point based on notification dated September 16, 2014, prima facie appears to be sound. There is no stipulation in the notification dated September 16, 2014 that any show-cause notice issued prior thereto by a commissioner of a particular region shall be taken to its logical conclusion by such commissioner even though on and from the date of the notification, the jurisdiction of the commissioner might suffer a change. In order to encourage the Bench to go ahead and entertain the writ petition based on the point of error of jurisdiction, the petitioner was required to satisfy the Bench that the error of jurisdiction attributed to the Commissioner, Durgapur Commissionerate is clear, conspicuous and obtrusive. Unfortunately, in its pursuit to satisfy this Bench the petitioner has miserably failed and hence, no exception can be taken to the impugned order by reason of the plea raised by Mr. Sen at least at this stage. It appears from paragraph 55 of the writ petition that presentation of this writ petition has been occasioned to avoid the pre-deposit that is required to be made by the petitioner in terms of section 35F of the 1994 Act. The petitioner ought not to be permitted to abandon the machinery for escaping payment as envisaged in the statute, and to invoke the jurisdiction of the High Court under Article 226 of the Constitution when the remedy open to him by an appeal to the Appellate Tribunal is adequate and efficacious. The writ petition is not entertained and stands dismissed, without costs.

Summary

Issues Involved:
1. Jurisdiction of the Commissioner, Durgapur Commissionerate.
2. Alleged non-response to the show-cause notice.
3. Imposition of penalty under section 114A of the Customs Act, 1962 without notice.
4. Availability of an alternative appellate remedy.

Detailed Analysis:

1. Jurisdiction of the Commissioner, Durgapur Commissionerate:
The petitioner challenged the jurisdiction of the Commissioner, Durgapur Commissionerate, arguing that the first two show-cause notices were issued by the Commissioner, Central Excise, Bolpur, and hence, the Commissioner, Durgapur, lacked the authority to decide the proceedings. The respondents countered this by presenting a notification dated September 16, 2014, which specified the jurisdiction of various commissioners. The court found the notification to be prima facie sound, indicating no error of jurisdiction by the Commissioner, Durgapur Commissionerate. The court held that the petitioner failed to demonstrate a clear, conspicuous, and obtrusive error of jurisdiction.

2. Alleged Non-Response to the Show-Cause Notice:
The petitioner contended that although a detailed reply was submitted to the show-cause notice dated October 7, 2013, the Commissioner, Durgapur Commissionerate, incorrectly recorded that no reply was submitted. The court acknowledged the incorrect recording but noted that the reply to a subsequent show-cause notice dated April 29, 2014, was considered in detail. Since there was no material difference between the two replies except for a plea of limitation, the court concluded that there was no gross violation of the principles of natural justice.

3. Imposition of Penalty under Section 114A of the Customs Act, 1962 without Notice:
The petitioner argued that the penalty under section 114A was imposed without being given an opportunity to respond, as the show-cause notice only mentioned section 112. The court noted that this point only challenged a part of the impugned order. Entertaining the writ petition on this ground alone would leave the demands of excise duty, customs duty, and interest unchallenged, which would be detrimental to the petitioner.

4. Availability of an Alternative Appellate Remedy:
The court emphasized that the availability of an alternative remedy under section 35B of the Central Excise Act, 1994, should generally preclude the writ court from entertaining the petition. The court cited several Supreme Court decisions, including Sales Tax Officer vs. Shiv Ratan G. Mohatta and Titaghur Paper Mills Co. Ltd. v. State of Orissa, which established that when a statutory forum is available for redressal, a writ petition should not be entertained. The court found no exceptional circumstances warranting the exercise of its extraordinary jurisdiction under Article 226 of the Constitution.

Conclusion:
The court dismissed the writ petition, directing the petitioner to seek remedy through the appellate mechanism provided under the 1994 Act. It emphasized that the petitioner should not bypass the statutory machinery to avoid the pre-deposit required under section 35F of the Act. The court also refused the petitioner’s request for a stay of operation of the judgment and order.