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TMI Blog2015 (2) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... - 16-1-2015 - MR. HEMANT GUPTA AND MR. HARI PAL VERMA, JJ. Mr. Samarth Sagar, Advocate, for the petitioner JUDGEMENT HEMANT GUPTA, J. Challenge in the present writ petition is to the demand (Annexure P-13) consequent to declining of an application for stay filed by the petitioner before the Customs, Excise Gold (Control) Appellate Tribunal, New Delhi (for short the Tribunal ) against the recovery of ₹ 81,02,802.73. The petitioner, a public limited company, has invoked the writ jurisdiction of this Court challenging the demand raised under the Central Excise and Salt Act, 1944 (since re-named as Central Excise Act, 1944) (hereinafter referred to as the Excise Act ). The petitioner-company asserts that its net-worth got fully eroded in the year 1987, which compelled its management to suspend operations of all units in all States and to approach the Board for Industrial and Financial Reconstruction (BIFR), a statutory body established under the Sick Industrial Companies (Special Provisions) Act, 1985 (for short the Act ). The petitioner asserts that in respect of the dues of Sales Tax Department, the petitioner filed a writ petition bearing CWP No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has protection under Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985. Reliance is also made to a similar writ petitions filed before the Bombay High Court and Madras High Court bearing W.P.No.294 of 1993 and W.P.No.14237 of 1994 respectively. In the written statement filed, it was stated that the amount due to the Government can be recovered from the petitioner by the competent authority in exercise of the powers conferred under the Act unless the recovery is stayed by specific order of the Appellate Authority. It is further stated that the petitioner is not entitled to protection under the provisions of the Act, as the dues outstanding on account of the central excise duty are recoverable under the provisions of Excise Act. Learned counsel for the petitioner has vehemently argued that once the matter including for recovery of dues of the central excise is pending before the BIFR, therefore, all proceedings against the petitioner-company are to be suspended. In support of such argument, learned counsel for the petitioner refers to a judgment of Hon ble Supreme Court in Raheja Universal Limited Vs. NRC Limited others AIR 2012 SC 1440 considering i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Securitisation and Reconstruction of Financial Assets and the Enforcement of Security Interest Act, 2002, be the first charge on the property of the assessee or the person, as the case may be. The argument of learned counsel for the petitioner is that Sections 22 32 of the Act gives override effect to the provisions of the Act over any other law. Therefore, the proceedings for recovery under the Excise Act cannot proceeding against the petitioner in view of the fact that the reference is pending before the BIFR. Though learned counsel for the petitioner could not disclose about the status of the reference pending before the BIFR, but from the web-site of BIFR, it transpires that reference stands disposed of on 15.01.2014, as the scheme stands sanctioned. A copy of the order dated 15.01.2014 is taken on record as Mark-A. However, there is no discussion in the order available on the website regarding dues payable to the central excise department, though there is discussion in respect of the sales tax dues payable to the Government of Maharashtra. In respect of W.P.No.294 of 1993, from the website of Bombay High Court, it transpires that the said writ petition stands dispos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing effect: 60. One must clearly understand a distinction between a law being enforced retrospectively and a law that operates retroactively. The restriction in the present case is a clear example where the right to practice before a limited forum is being taken away in presenti while leaving all other forums open for practice by the appellants. Though such a restriction may have the effect of relating back to a date prior to the presenti. In that sense, the law stricto sensu is not retrospective, but would be retroactive. It is not for the Court to interfere with the implementation of a restriction, which is otherwise valid in law, only on the ground that it has the effect of restricting the rights of the people who attain that status prior to the introduction of the restriction. It is certainly not a case of settled or vested rights, which are incapable of being interfered with. It is a settled canon of law that the rights are subject to restrictions and the restrictions, if reasonable, are subject to judicial review of a very limited scope. xxx xxx 64. Earlier, the nature of law, as substantive or procedural, was taken as one of the determinati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Institutions qua the property of the borrower, therefore, the State law would prevail. It was observed as under: 114. By enacting various provisos to sub-section (9), the legislature has ensured that priority given to the claim of workers of a company in liquidation under Section 529A of the Companies Act, 1956 vis a vis secured creditors like banks is duly respected. This is the reason why first of the five unnumbered provisos to Section 13(9) lays down that in the case of a company in liquidation, the amount realized from the sale of secured assets shall be distributed in accordance with the provisions of Section 529A of the Companies Act, 1956. This and other provisos do not create first charge in favour of the worker of a company in liquidation for the first time but merely recognize the existing priority of their claim under the Companies Act. It is interesting to note that the provisos to subsection (9) of Section 13 do not deal with the companies which fall in the category of borrower but which are not in liquidation or are not being wound up. xxx xxx 115. The non obstante clauses contained in Section 34(1) of the DRT Act and Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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