2002 (2) TMI 132 - HC - Central Excise

Summary

Issues Involved:
1. Jurisdiction to issue notices u/s 11A without challenging the original order.
2. Applicability of amended Section 11B to refunds granted before its enactment.

Summary:

Issue 1: Jurisdiction to issue notices u/s 11A without challenging the original order

The Petitioners challenged various show cause notices issued by the Respondents u/s 11A of the Central Excise & Salt Act, 1944, seeking to recover amounts erroneously refunded. The Petitioners argued that the refund granted as a consequential relief by accepting the order-in-original dated 11-9-1984 had attained finality and could not be reopened without challenging the original order. The Court held that u/s 11A, the Central Excise Officer had jurisdiction to issue notices to recover erroneous refunds without challenging the original order. The issuance of a notice u/s 11A is a primary and fundamental requirement for recovery of any money erroneously refunded, and there are no preconditions attached for issuing such notice.

Issue 2: Applicability of amended Section 11B to refunds granted before its enactment

The Petitioners contended that the 1991 amendment to Section 11B of the Act did not apply to refunds granted before its enactment. The Court referred to the decision of the Apex Court in Mafatlal Industries Ltd. v. Union of India, which held that the amended Section 11B applies to all pending proceedings where the refund has not been made finally and unconditionally. Since the refund in the present case was conditional and subject to the decision of the Apex Court in M.R.F. Ltd., the Court concluded that the show cause notices issued u/s 11A were valid and the issues raised in these notices must be adjudicated in accordance with the amended provisions of Section 11B.

Order

The Court upheld the validity of the show cause notices and directed the Respondents to adjudicate these notices in accordance with the amended provisions of Section 11B, after giving a personal hearing to the Petitioners. The adjudication was to be completed as expeditiously as possible, preferably within six months. All the Writ Petitions were dismissed, and the Rules were discharged with no order as to costs.