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Issues Involved:
1. Legality of pre-audit procedure for refund claims. 2. Finality and validity of the Assistant Collector's order dated 2-6-1992. 3. Validity of the impugned order rejecting the refund claim. 4. Maintainability of the writ petition in light of alternative statutory remedies. Detailed Analysis: Issue 1: Legality of Pre-Audit Procedure for Refund Claims The court examined whether the pre-audit procedure outlined in the standing order dated 7-8-1990 of the Collector (Internal Audit) and the circular dated 31-9-1990 of the Central Board of Excise and Customs was legally valid. The court held that the proceedings before the Assistant Collector for adjudicating the claim for refund of excise duty are quasi-judicial in nature and must be conducted independently and impartially. The pre-audit procedure was found to be an undue interference with the quasi-judicial discretion of the Assistant Collector, rendering him a puppet in the hands of others. The court cited the Supreme Court's decision in Orient Paper Mills v. Union of India, which emphasized that no authority can control the decision of a judicial or quasi-judicial authority. The standing order and the circular were therefore struck down as they imposed fetters on the statutory power of the Assistant Collector and were not sanctioned by law. Issue 2: Finality and Validity of the Assistant Collector's Order Dated 2-6-1992 The court considered whether the order dated 2-6-1992, prepared and signed by the Assistant Collector, amounted to "making" of the order within the meaning of Section 11B of the Central Excises and Salt Act, 1944. The court held that the order became effective when it was signed by the Assistant Collector, as there is no requirement of formal pronouncement or delivery of the order in such cases. The court cited the Supreme Court's decision in Collector of Central Excise v. M.M. Rubber Company, which held that an order becomes operative on the date it is signed. The order dated 2-6-1992 was therefore valid and effective, and the pre-audit procedure was deemed illegal. Issue 3: Validity of the Impugned Order Rejecting the Refund Claim The court examined the validity of the impugned order rejecting the refund claim on the grounds of "unjust enrichment." It was found that the succeeding Assistant Collector had no authority to issue a fresh show cause notice and pass a new order when a valid and subsisting order dated 2-6-1992 was already in place. The impugned order was deemed legally invalid as it was influenced by the pre-audit procedure, which was found to be unlawful. Issue 4: Maintainability of the Writ Petition in Light of Alternative Statutory Remedies The court addressed whether the writ petition was maintainable despite the availability of an alternative statutory remedy of appeal. The court held that the impugned order was non est factum in the eye of law due to the invalid pre-audit procedure and the violation of principles of natural justice. The court cited the Supreme Court's decision in Whirlpool Corporation v. Registrar of Trade Marks, which held that alternative remedies do not bar the maintainability of a writ petition in cases of violation of principles of natural justice or lack of jurisdiction. The writ petition was therefore maintainable. Conclusion: The petition was allowed, and the impugned order dated 27-12-1993/7-1-1994 was quashed. The respondents were directed to refund the amount of Rs. 8,45,323.10 to the petitioner as per the valid order dated 2-6-1992 of the Assistant Collector, Satna. Costs were awarded as incurred.
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