2019 (2) TMI 670 - HC - Central Excise

Reconstitution of the firm - re-opening of the Bar - time for making deposit - Held that - Considering the fact the licence expires on 31.03.2019, we cannot grant the time sought for by the appellant. We direct that 50% of the balance amounts be paid on or before 07.03.2019 failing which the license would stand cancelled on 08.03.2019. If such amounts are paid within the time stipulated, then, the appellant can be allowed to continue operating the Bar till 21.03.2019, by which time, the appellant will pay 50% of what is remaining to be paid after the remittance on 07.03.2019. Writ appeal is disposed of with limited interference to the order of the learned Single Judge.

Issues:
1. Compliance with interim order for remittance of demanded amounts.
2. Alleged violations in reconstitution of the firm leading to the impugned order.
3. Appellant's request for leeway in making deposit and reopening the Bar.
4. Payment schedule and conditions for avoiding cancellation of license.
5. Disposition of the writ appeal with limited interference.

Compliance with interim order for remittance of demanded amounts:
The appellant sought time to remit the demanded amounts upon appeal admission. The appellant undertook to pay ?55 lakhs immediately and requested to reopen the Bar with a condition to pay the balance within three months. The Court insisted on the initial remittance of ?55 lakhs, which the appellant complied with, leading to the prayer for reopening the Bar.

Alleged violations in reconstitution of the firm leading to the impugned order:
The Government Pleader highlighted serious violations in the reconstitution of the firm, alleging it as a sale of the license by accepting money from inducted directors. The Excise Commissioner passed the impugned order following a recommendation by the Deputy Commissioner due to these violations. The Department emphasized the need for payment to avoid license cancellation, as the appellant failed to notify the change in Directors and obtain approval as required by the Foreign Liquor Rules.

Appellant's request for leeway in making deposit and reopening the Bar:
While the Court acknowledged no commendable ground for interference with the Single Judge's order, it recognized the appellant's need for time to make the deposit. Considering the Bar's closure since September and the appellant's payment of ?55 lakhs as per the Court's oral direction, some leeway was granted for the deposit timeline.

Payment schedule and conditions for avoiding cancellation of license:
Given the license's impending expiry on 31.03.2019, the Court directed 50% of the balance amounts to be paid by 07.03.2019 to avoid license cancellation on 08.03.2019. Further payment deadlines were set, with stringent penalties for non-compliance, including cancellation of the license, forfeiture of the right to reapply for a license, and an additional ?25 lakhs penalty for failure to comply with the Court's undertaking.

Disposition of the writ appeal with limited interference:
The writ appeal was disposed of with limited interference in the Single Judge's order, allowing all issues to be raised in the writ petition without specific observations in the judgment. No costs were awarded in the matter.

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