1978 (11) TMI 76 - HC - Central Excise

Summary

Issues Involved:

1. Jurisdiction of Rule 9 and Rule 10 under the Central Excises and Salt Act, 1944.
2. Timeliness and validity of the appeal filed by the petitioner.
3. Applicability of the extraordinary remedy under Article 226 of the Constitution.

Issue-wise Detailed Analysis:

1. Jurisdiction of Rule 9 and Rule 10 under the Central Excises and Salt Act, 1944:

The petitioner, a manufacturer of tread rubber, argued that the cuttings returned for reprocessing were not excisable as they had already been subjected to a levy. The Assistant Collector of Customs issued a demand notice (Ext. P1) under Rule 9(2), which the petitioner contended was without authority. Rule 9 prohibits the removal of excisable goods until duty is paid and allows for penalties and confiscation if goods are removed without payment. Rule 10, on the other hand, deals with the recovery of duties short-levied or erroneously refunded and has a stipulated time limit for action. The petitioner argued that the goods in question should fall under Rule 10, subject to a one-year limitation period per Rule 173J, as they had been self-assessed and shown as nil-assessed. The court noted that it was unclear whether the goods fell under Rule 9 or Rule 10, and the respondents had not established that the goods came within the ambit of Rule 9.

2. Timeliness and validity of the appeal filed by the petitioner:

The petitioner filed an appeal (Ext. P3) against the order (Ext. P2) rejecting their contention, but the appeal was dismissed as time-barred by the Appellate Collector of Central Excise (Ext. P4). The petitioner claimed the appeal was sent by registered post on 2-4-1974 but was mistakenly addressed to the Appellate Collector of Customs, Cochin, instead of Madras. The court found that the respondents did not provide sufficient details about the transmission and receipt dates of the appeal, which were within their special knowledge. The court noted that if the appeal had not been wrongly addressed, it would have likely reached the appellate authority within the stipulated period.

3. Applicability of the extraordinary remedy under Article 226 of the Constitution:

The petitioner sought an extraordinary remedy under Article 226, arguing that justice and equity required a hearing on merits. The respondents opposed this, stating the appeal was clearly out of time and the petitioner had slept over their rights. The court recognized the difficult questions raised and the unclear facts regarding the applicability of Rule 9 or Rule 10. Given the peculiar circumstances and the jurisdictional questions, the court deemed it appropriate to allow the petitioner an opportunity to be heard by the appellate authority, even if the appeal was received outside the period of limitation due to the wrong address.

Conclusion:

The court set aside the order of the Appellate Collector (Ext. P4) and directed him to consider the petitioner's appeal (Ext. P3) on merits. The court emphasized that its observations did not touch upon the merits of the case and allowed the original petition without costs.