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TMI Blog2018 (8) TMI 2016X X X X Extracts X X X X X X X X Extracts X X X X ..... CISE, GAUHATI OTHERS [ 2015 (5) TMI 500 - SUPREME COURT ] holding that there was always a requirement of issuance of show cause notice by the assessing authority before passing the order of recovery irrespective of the fact whether Section 11A of the Act is attracted or not but in the given facts of the present petitioner the Apex Court in unequivocal terms arrived to the conclusion as observed in para 45 that any infraction of principles of natural justice in the instant case and to make a fresh demand of amount recoverable after issuance of notice to show cause, would be a useless formality and is not going to serve any purpose after the law has been laid down by the Apex Court in the case of R.C. Tobacco (P) Ltd. [ 2005 (9) TMI 80 - SUPREME COURT ]. It may be further noticed that when the notices were issued by the assessing authority to deposit the outstanding interest in terms of Section 154(4) of the 2003 Act vide notice dated 30-9-2015 the petitioner submitted their objections and after affording opportunity of hearing in terms of the interim order of this Court dated 8-12-2015 the authorized representative of the petitioner appeared before the assessing authority on 25-4-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng adopted of assailing for futile reasons just to defer, for the sake of convenience being affordable to the litigant, such tendency which has now been developed, is deprecated by this Court. Petition dismissed. - Ajay Rastogi, CJ. and Arindam Lodh, J. Shri A. Kashyap, P. Prasad and K. Roy, Advocates, for the Petitioner. Shri P. Datta and T. Debbarma, Advocates, for the Respondent. JUDGMENT This batch of writ petitions since involve a common question of law and facts, with the consent of the parties are being disposed of by the present order. The facts are being noticed from W.P. (C) No. 1523/2017. 2. The facts, in brief, which manifest from the record and relevant for the present purpose, are that the petitioner is the manufacturer/exporter/ whole-sale supplier of chewing tobacco/cosmetic products, etc. The Government of India announced a separate industrial policy for the north-eastern region of the country in December, 1997 which proposed to stimulate synergetic development of industries in the region by giving a cluster of incentives which included exemption from excise duties, transport subsidies, capital investment subsidies, interest subsidies, and other benefits, etc. Pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith sub-section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of Section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), by the Central Government shall stand amended and shall be deemed to have been amended in the manner as specified against each of them in column (3) of the Ninth Schedule, on and from the corresponding date specified in column (4) of that Schedule retrospectively, and accordingly, notwithstanding anything contained in any judgment, decree or order of any Court, tribunal or other authority, any action taken or anything done or purported to have been taken or done under the said notifications, shall be deemed to be and always to have been, for all purposes, as validly and effectively taken or done as if the notifications as amended by this sub-section had been in force at all material times. (2) For the purposes of sub-section (1), the Central Government shall have and shall be deemed to have the power to amend the notifications referred to in the said sub-section with retrospective effect as if the Central Government had the power to amend th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the excise duties already refunded to the entrepreneurs would be liable to be recovered, no further refund would be made and the entrepreneurs would be liable to pay the excise duty not paid when the exemption was in force between 8-7-1999 and 27-1-2001. 7. Batch of writ petitions were filed including by the present petitioners assailing constitutional validity of Section 154 of Finance Act, 2003. 8. The Apex Court in the case of R.C. Tobacco (P) Ltd. Anr. v. Union of India Anr. reported in (2005) 7 SCC 725 = 2005 (188) E.L.T. 129 (S.C.) decided on 19-9-2005 upheld the constitutional validity of Section 154 of the Finance Act, 2003 and we consider it appropriate to quote the relevant extract of the judgment which reads ad infra : 50. Furthermore having upheld the constitutional validity of Section 154 it would be a pyrrhic victory for the Union of India if they could not in fact recover the tax. It is not a case where the legislation has merely withdrawn the exemptions. The consequences of the withdrawal have been statutorily provided for including the recovery of the excise duties refunded or not paid. The effective period of such imposition is about eight months. The State has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the instance of the petitioner before the Apex Court was that no such recovery proceedings could have been initiated without a show cause notice being served as contemplated under Section 11A of the Excise Act and initiating recovery proceedings without a show cause notice being served as claimed by the petitioners is in violation of the principles of natural justice. While taking note of the submissions in detail, in para 37 of the judgment in Dharampal Satyapal Limited (supra), the Apex Court finally arrived to a conclusion that ordinarily it is a requirement and imperative to issue a show cause notice by the assessing authority before passing the order of recovery, irrespective of the fact whether Section 11A of the Act is attracted in the instant case or not on principle. But while examining the case of the present petitioner it was observed in para 45 in Dharampal Satyapal Limited (supra) that even after arriving to the conclusion that there was an infraction of the principles of natural justice but in the given case no purpose was going to be served in issuance of a show cause notice and which would be a futile exercise after the law has been laid down by the Apex Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, we find that such an exercise would be totally futile having regard to the law laid down by this Court in R.C. Tobacco (supra). 12. It may be relevant to note that the quantification of the amount as reflected by the respondents in their demand notice impugned before the Apex Court was not disputed, even that has not been disputed even in the instant proceedings, and taking note the Apex Court in the case of the present petitioner finally arrived to a conclusion that issuance of a show cause notice would be an empty formality and no purpose would have been served in the instant case of service of a show cause notice before the demand notice being raised by the respondents which was impugned in the proceedings dated 3-6-2003. 13. We consider it appropriate to quote the relevant paragraphs (46 and 48) of the judgment in Dharampal Satyapal Limited (supra) which reads ad infra : 46. To recapitulate the events, the appellant was accorded certain benefits under Notification dated 8-7-1999. This Notification stands nullified by Section 154 of the 2003 Act, which has been given retrospective effect. The legal consequence of the aforesaid statutory provision is that the amount with whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he record that after judgment of the Apex Court upholding the demand notice dated 3-6-2003 which was raised in terms of Section 154 of the Finance Act, 2003, notices served to the petitioner in furtherance thereof as a reminder to deposit the outstanding pending interest of ₹ 15,73,62,158/- by Unit-I and ₹ 2,47,52,368/- by Unit-II by 10-10-2015 in terms of Section 154(4) of the Act dated 30-9-2015 and that was again assailed by the petitioner by filing of writ petition questioning the quantification of the amount which was indicated by the respondents in the respective notices dated 30-9-2015 and by an interim order dated 8-12-2015 this Court directed the assessing authority to give an opportunity of hearing to the petitioner to produce its records, accounts books and other material to show what amount has already been paid to the department and the amount, if any, due in terms of the demand notice dated 3-6-2003 with liberty to the assessing authority to pass a detailed order after affording opportunity of hearing the petitioner. 16. It further reveals from the record that in compliance of the interim order of this Court dated 8-12-2015 the petitioner appeared before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DSL attended the personal hearing and has submitted two calculation sheets of interest due for their two units at the time of hearing. From the calculation it appears that interest calculated by them is less than that of the interest calculated by this office. Scrutiny of their calculation reveals some differences with Department s calculation which can be attributed to the reasons mentioned below. Departmental calculation, as it appears, is based on 30 days of exemption/leave period, as provided in the Act, for paying interest from 14-5-2003, the date of assent of the Finance Act, 2003 by the President of India, to 12-6-2003 (both days inclusive) i.e. interest was calculated taking into account the day 13-6-2003. But the assessee has calculated interest from 14-6-2003 i.e. excluding the date of assent on 14-5-2003. The assessee paid the principal amount during a long span of period from 2007 to 2012 i.e. long after the last due date of payment 13-6-2003. Hence, there were one, two or three leap year viz. 2004, 2008 2012 in the intervening paying period of principal amount. In the Departmental calculation, the number of days in a leap year was counted as 366 days whereas the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 3-8-2016 in the case of some other assessee and liberty was granted to the petitioner to approach the Commissioner, Central Excise, Shillong restraining the respondents from taking any coercive measure against the petitioner. 18. It has not been placed on record that what steps were taken by the petitioner after passing of the order by this Court with liberty granted to approach the Commissioner, Central Excise, Shillong but the fact reveals that further demand notice when served upon the petitioner dated 2-5-2017 as a reminder to make the payment of interest of Unit-I and Unit-II in terms of the provisions under Section 154(4) of the Finance Act, 2003. Immediately after the demand notice being served dated 2-5-2017 by the Assistant Commissioner, the petitioner again submitted two preliminary objections dated 28-6-2017 that the liability of interest needs to be computed from thirty days after the correct computation has been informed to the petitioner and this has first happened in September, 2015 during pendency of writ petition by the present notice and for affording opportunity to present their case in person for the reason that the interest is required to be recalculate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the demand notice dated 3-6-2003 followed by 6-6-2003 to make payment of recoverable duty within thirty days from 14-5-2003 and in case of delay in payment of interest payable at the rate of fifteen per cent per annum payable from the date immediately after expiry of thirty days from 14-5-2003 till the date of payment in terms of Section 154(4) of the Finance Act, 2003 has been finally upheld by the Apex Court in the case reported in (2015) 8 SCC 519 filed at the instance of the present petitioner and it is not now open for the petitioner to question the subsequent demand notice which has been sent in furtherance after dismissal of their writ petition by the Apex Court with the formal intimation to comply the demand notice dated 3-6-2003 which has attained finality after the judgment of the Apex Court and what being raised is no more res integra and open for scrutiny. 23. It has been further urged by the counsel for the respondents that the petitioner is liable to pay principal amount with interest under Section 154 of the 2003 Act of which demand was raised on 3-6-2003 but the petitioner paid the principal amount in installments but did not pay the interest but after the Apex Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the present petitioner reported in (2015) 8 SCC 519 holding that there was always a requirement of issuance of show cause notice by the assessing authority before passing the order of recovery irrespective of the fact whether Section 11A of the Act is attracted or not but in the given facts of the present petitioner the Apex Court in unequivocal terms arrived to the conclusion as observed in para 45 that any infraction of principles of natural justice in the instant case and to make a fresh demand of amount recoverable after issuance of notice to show cause, would be a useless formality and is not going to serve any purpose after the law has been laid down by the Apex Court in the case of R.C. Tobacco (P) Ltd. (supra). More so, when the quantification of the demand raised has never been questioned by the petitioner and it was neither disputed before the Apex Court as observed in para 46 nor before us and after being settled that issuance of show cause notice in the given facts and circumstances of the present case of the petitioner would be an empty formality and no useful purpose is going to be served and once the demand notice dated 3-6-2003 has been upheld by the Apex Court f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without affording opportunity of hearing as mandated under Section 11A of the Act we are extremely sorry to say that his very contention was repelled by the Apex Court at the stage when he questioned the first demand notice impugned dated 3-6-2003 regarding applicability of under Section 11A of the Excise Act in the judgment reported in (2015) 8 SCC 519 of which a detailed reference has been made by us and needs outright rejection. 30. The further submission made that the order of the CESTAT, Kolkata has not been considered by the assessing authority for computing the date of thirty days under Section 154(4) from the date amount of interest has been communicated to the assessee is wholly fallacious and deserves rejection for the reason that after the constitutional validity of Section 154 of the Act, 2003 has been upheld by the Apex Court, being clear and self explicit in terms that recovery of all amounts of duty or interest or other charges under the section has to be made within a period of thirty days from the date of interest or other charges which have not been collected for one time refunded would have to be collected if the provisions of this section had been in force at a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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