2021 (9) TMI 668 - HC - Central Excise

Area based exemption - North East Industrial Investment Promotion Policy, 2007 - vires of notifications dated 27.03.2008 and 10.06.2008 - contention is that the application of the petitioner for fixing of the special rate which was made on 13.06.2021, has not yet been given a final consideration by the Principal Commissioner, GST, Guwahati - HELD THAT - Considering the limited grievance raised, this writ petition is disposed off directing the Principal Commissioner of GST, Guwahati to pass a reasoned order on the application of the petitioner dated 13.06.2021 requesting for fixation of a special rate. By requiring the Principal Commissioner, GST, Guwahati to pass an order it is meant that the Principal Commissioner, GST may pass any reasoned order as may be advisable under the law by either accepting or rejecting the request made by the petitioner. In doing so, the Principal Commissioner, GST, Guwahati may pass any order as deemed appropriate under the law. Petition disposed off.

Summary

Issues:
1. Exemption against payment of excise duties under NEIIP, 2007.
2. Validity and vires of notifications modifying exemption.
3. Interim order for releasing 50% of amount due during appeal.
4. Applicability of interim order to similarly situated assesses.
5. Supreme Court's final consideration overturning previous judgments.
6. Dismissal of writ petitions challenging modified notifications.
7. Requirement for assesses to refund 50% amount received.
8. Entitlement to special rate under Notification No. 20/2007-CE.
9. Delay in consideration of application for fixing special rate.
10. Direction to Principal Commissioner to pass reasoned order.

Analysis:
1. The petitioner, a partnership firm manufacturing excisable goods, sought exemption under NEIIP, 2007. Modifications to the exemption were introduced through notifications in 2008, leading to legal challenges by aggrieved manufacturers. Previous judgments invalidated the notifications, but subsequent appeals upheld the modifications until the Supreme Court intervened in 2020, leading to the dismissal of writ petitions challenging the modified notifications.

2. An interim order by the Supreme Court required the GST Department to release 50% of the amount due to assesses pending appeal. The order was later clarified to apply to all similarly situated assesses. Following the Supreme Court's final decision, assesses were required to refund the 50% amount received, as the excise duty exemption under NEIIP, 1997, was no longer applicable.

3. The petitioner claimed entitlement to a special rate under Notification No. 20/2007-CE. Despite delays in the application's consideration, the petitioner received a demand notice to return the refunded amount. The petitioner sought a reasoned order on the special rate application, which had not been finalized by the Principal Commissioner, GST, Guwahati.

4. The High Court directed the Principal Commissioner to pass a reasoned order on the petitioner's special rate application within one month. The order emphasized that the Principal Commissioner could accept or reject the request as deemed appropriate under the law, providing clarity on the next steps for the petitioner in light of the changing legal landscape regarding excise duty exemptions.