2001 (9) TMI 106 - HC - Central Excise

Summary

Issues: Classification of edible preparations for excise duty, validity of show cause notice, availability of alternative remedies under the Act.

Classification of Edible Preparations: The petitioner challenged a show cause notice alleging manufacture of edible preparations like Turmeric Powder, Chilly Powder, and Masala Powder under Central Excise Tariff sub-heading 2108.90. The petitioner argued that these items should be classified under 0903.00 and not attract any Excise Duty. The Department cited a Ministry of Finance circular classifying certain products as spices under sub-heading 0903.00 with NIL duty, while instant mixes fell under sub-heading 2108.90 with 20% duty. The court noted the Ministry's instructions and approved the classification of the petitioner's goods under 0903.10 as spices, quashing the show cause notice for items under 0903.00.

Validity of Show Cause Notice: The Department contended that the petitioner should have pursued alternative remedies provided under the Act instead of approaching the High Court at this stage. The court acknowledged the general principle that when alternative remedies are available, the High Court should not entertain matters under Article 226. However, considering the Department's acceptance of the petitioner's contention regarding classification, the court found it unnecessary to direct the petitioner to go through the show cause process. The court quashed the show cause notice for items falling under 0903.00 based on the Department's stand in the counter affidavit.

Availability of Alternative Remedies: The respondents argued that the writ petition was premature and should be dismissed since the petitioner did not exhaust alternative remedies before approaching the court. While acknowledging the importance of pursuing statutory remedies, the court found it unnecessary in this case due to the Department practically accepting the petitioner's classification argument. The court disposed of the writ petition without costs, allowing the Department to proceed in accordance with the law for any items not falling under the approved classification.