1997 (11) TMI 106 - HC - Central Excise

Summary

Issues:
Challenge to show cause notice under Article 226 of the Constitution of India regarding excise duty valuation and price list approval.

Analysis:
The petition challenges a show cause notice issued by the Assistant Collector, Central Excise, regarding excise duty valuation for manufacturing two-wheeler scooters. The petitioners argue that excise duty is chargeable based on value, determined under Section 4 of the Central Excises and Salt Act, 1944. They contend that the respondents had previously approved their price list, making the notice unjustified. On the other hand, the respondents argue that the petitioners sell goods to wholesale dealers in different regions at varying rates, creating a discrepancy. The respondents assert that the petitioners should appear before the authority and address the grounds of the notice.

The Counsel for the petitioners cites various judgments to support the maintainability of a writ under Article 226 even against a show cause notice, emphasizing the need to show jurisdictional issues or arbitrariness. Conversely, the respondents' Counsel relies on judgments stating that interference against show cause notices is unnecessary, and the noticee should address the authority directly.

The Court notes that the petition solely challenges the show cause notice and that the petitioners have not responded to it yet. The petitioners fear the notice is based on a judgment that has been set aside by the Supreme Court, questioning the authority's jurisdiction. Referring to legal precedents, the Court emphasizes that show cause notices are the beginning of a process and that the jurisdiction of the Court should not be invoked against such notices unless there are clear jurisdictional errors or absence. The Court declines relief to the petitioners and directs them to submit a reply within a month, allowing objections as per the law, and advises the authority to consider all aspects and provide a reasoned order after a hearing.

In conclusion, the Court dismisses the petition without delving into the case's specifics, directing the parties to handle their costs. Any security amount is to be refunded to the petitioner after verification.