9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (3) TMI 1164 - HC - Central ExciseShort paid Central Excise Duty - misdeclaration of maximum packing speed of pan masala pouch packing machines installed at petitioner's factory premises - Section 11A (4) of the Central Excise Act, 1944 read with Section 174 of the Chhattisgarh Goods Service Act, 2017 - Circular dated 10.2.2015 - HELD THAT - From the pleadings made in writ petition, it is clear that petitioner got installed different PMPMs of different MRPs at its factory premises. Main grievance raised by learned Senior Counsel for petitioner is with respect to jurisdiction of authority issuing impugned show-cause notice to petitioner. Perusal of impugned show-cause notice would show that detailed investigation has been conducted by respondent before issuing show-cause notice to petitioner. Investigation was conducted based on intelligence information. In show-cause notice, there is specific mention about difference in speed of PMPM; giving wrong information in report of Chartered Engineer regarding number of funnels in PMPM than that of number of funnels as per report of manufacturer of machines. In case of ORYX FISHERIES PRIVATE LIMITED VERSUS UNION OF INDIA 2010 (10) TMI 660 - SUPREME COURT where it was held that It is obvious that at that stage the authority issuing the charge- sheet, cannot, instead of telling him the charges, confront him with definite conclusion of his alleged guilt. If that is done, as has been done in this instant case, the entire proceeding initiated by the show cause notice gets vitiated by unfairness and bias and the subsequent proceeding become an idle ceremony - In view of above dictum of Hon'ble Supreme Court, if the facts of present case are considered, it would reveal that respondent conducted investigation based on intelligence information. Upon detailed investigation, as appearing in show-cause notice, it revealed that there was mis-declaration by petitioner, based upon which show-cause notice is issued to petitioner calling upon petitioner to submit reply within a particular period. Respondent has been authorized under Circular dated 10.2.2015 to issue show-cause notice. Hence, in the considered opinion of this Court, impugned show-cause notice cannot be stated to be issued by an authority not having jurisdiction. The respondent was having jurisdiction to issue notice as per Circular dated 10.2.2015. In impugned notice reasons for issuing show cause notice have been discussed in very detail - this writ petition at this stage is pre-mature, it is liable to be and is hereby dismissed.
Issues Involved:
1. Jurisdiction of the authority issuing the show-cause notice. 2. Validity of the show-cause notice based on alleged misdeclaration of the packing speed of machines. 3. Availability of alternative remedies for the petitioner. 4. Competence of the Principal Additional Director General to issue the show-cause notice. 5. Relevance and consideration of technical reports and findings. Issue-wise Detailed Analysis: 1. Jurisdiction of the authority issuing the show-cause notice: The petitioner contended that the Principal Additional Director General, Directorate General of GST Intelligence, New Delhi, lacked jurisdiction to issue the show-cause notice. The court examined the Circular dated 10.2.2015, which authorized officers of various ranks within the Directorate General of Central Excise Intelligence to exercise all powers under the Central Excise Act, 1944, and the rules made thereunder. The court found that the respondent was authorized under this circular to issue the show-cause notice, thereby rejecting the petitioner’s claim of lack of jurisdiction. 2. Validity of the show-cause notice based on alleged misdeclaration of the packing speed of machines: The petitioner argued that the show-cause notice was based on incorrect technical findings and misdeclarations regarding the packing speed of the machines. The respondent conducted a detailed investigation based on intelligence information, which revealed discrepancies in the number of funnels in the machines as reported by the Chartered Engineer compared to the manufacturer’s report. The court noted that the show-cause notice contained prima facie material warranting an explanation from the petitioner regarding the proposed excise duty and penalty. 3. Availability of alternative remedies for the petitioner: The respondent argued that the writ petition was not maintainable as the petitioner had an alternative remedy of submitting a reply to the show-cause notice. The court referenced several Supreme Court judgments, including Union of India vs. Bajaj Tempo Ltd. and Special Director & anr Vs. Mohd. Ghulam Ghouse & anr, which emphasized that courts should not interfere with show-cause notices unless there is a clear lack of jurisdiction. The court concluded that the petitioner should respond to the show-cause notice and allow the authorities to adjudicate the matter. 4. Competence of the Principal Additional Director General to issue the show-cause notice: The petitioner challenged the competence of the Principal Additional Director General to issue the show-cause notice. The court referred to the Circular dated 10.2.2015, which conferred powers on the officers of the Directorate General of Central Excise Intelligence to issue show-cause notices and adjudicate cases. The court found that the Principal Additional Director General was competent to issue the show-cause notice, and the petitioner’s challenge on this ground was without merit. 5. Relevance and consideration of technical reports and findings: The petitioner contended that the show-cause notice was based on a technical report by an Assistant Professor from IIT, Delhi, which was different from the earlier reports by Chartered Engineers. The court noted that the respondent’s investigation, based on intelligence information, included evaluating the technical aspects and discrepancies in the machine’s packing speed. The court held that the detailed investigation and the reasons provided in the show-cause notice were sufficient to warrant an explanation from the petitioner. Conclusion: The court dismissed the writ petition at the admission stage, concluding that the show-cause notice was issued by a competent authority with jurisdiction and that the petitioner had an alternative remedy of responding to the notice. The court emphasized that the detailed investigation and technical findings warranted an explanation from the petitioner, and the show-cause notice could not be quashed at this premature stage.
|
