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TMI Blog2023 (8) TMI 1451X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture of Ayurvedic Medicines falling under Chapter 30 of the First Schedule of the Central Excise Tariff Act, 1985. The petitioner No.1 is a firm registered with the Goods and Service Tax (erstwhile Central Excise Act, 1944). The petitioner Nos. 2 & 3 are partners in petitioner No.1- Firm. The petitioners had the business transactions with respondent No.7- M/s. Gagan Pharmaceuticals having principal place of business at Sriganganagar, Rajasthan. The petitioner-Firm made their purchase of goods/ material/ medicines from the respondent No.7. The officials respondent authorities on the basis of an intelligence input, issued show cause notice dated 28.09.2020 to the petitioners and the respondent No.7. The respondent No.7- M/s. Gagan Pharmaceuticals, Sriganganagar has assailed the notice issued to it by way of filing a writ petition before this Court. In the same fashion, the petitioners were also issued the show cause notice by the respondent No.1 which has been impugned in the present writ petition and a prayer has been made for quashing of the same besides other prayers. 3. A reply has been filed by the respondent - Union of India, wherein a preliminary objection has been ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in paragraphs 20 & 21 of the writ petition, tried to demonstrate that the part of the cause of action has arisen to the petitioner-Firm and, therefore, the writ petition before this Court is maintainable. The learned Sr. Counsel further submitted that the entire proceedings emanates from the file on the basis of which the show cause notice has been issued to the petitioners as well as respondent No.7- M/s. Gagan Pharmaceuticals, Sriganganagar. He submits that manufacturing of goods, on the basis of which it has been alleged that Central Excise Duty was not paid, was made at the factory located at M/s. Gagan Pharmaceuticals, Sri Ganganagar, Rajasthan. The show cause notice to M/s. Gagan Pharmaceuticals, Sri Ganganagar was issued in June, 2020 and based on the same, the consequential show cause notice has been issued to the petitioner-Firm. Therefore, this Court has territorial jurisdiction to entertain the present writ petition. 10. Learned counsel submits that since the show cause notice to the petitioner-Firm has been issued for evasion of the Central Excise Duty on the manufacturing of the goods made by M/s. Gagan Pharmaceuticals, Sri Ganganagar and subsequently, sold to the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioner-Firm and service of the same was also effected in the State of Punjab although the show cause notice emanates from the file of the respondent-Department which is common to both the petitioner-Firm and respondent No.7 for issuance of notices. It is also clear that the evasion of the Tax liability on both petitioner-Firm as well as the respondent No.7 is not similar and they are held liable for the violations/infractions respectively at their own ends. The petitioners were receiving the goods for onward sale etc. in the State of Punjab were manufactured by the respondent No.7 in the State of Rajasthan. 15. The pleadings with respect to the cause of action or part of cause of action which arose to the petitioners read as under:- "20. It is further humbly submitted here that entire proceedings in the present case has been initiated on the basis of proceedings initiated on M/s Gagan Pharmaceutical, Sri Ganganagar by the respondent No.1 and the same is sole reason for issuance of the impugned show cause notice by the Respondent No.1. 21. At this juncture it would not be out of place to mention here that initially a show cause notice issued by the respondent No.1 was pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent No.7 and certain evasions having been pointed out in the same, will not give any cause of action to the petitioner-Firm to approach this Court by way of filing the present writ petition. 17. Secondly, merely because the show cause notice has been issued to the petitioner-Firm on the basis of a common file maintained by the official respondents, will not be relevant to draw a presumption that part of cause of action has arisen to the petitioner-Firm in the territorial jurisdiction of this Court, merely because on the basis of the same common file, the show cause notice has been issued to the respondent No.7. 18. The Hon'ble Supreme Court in the case of Kusum Ingots and Alloys Ltd. V/s Union of India (UOI) & Ors. reported in 2004(6) SCC-254 held as under:- "5. On the other hand, the contention of the learned counsel appearing on behalf of the respondent is that as no cause of action arose within the territorial jurisdiction of the High Court of Delhi, the writ petition has rightly not been entertained. Cause of Action: 6. Cause of action implies a right to sue. The material facts which are imperative for the suitor to allege and prove constitutes the cause of acti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kour v. Partap Singh (15 IA 156), it was held: "... the cause of action has no relation whatever to the defence which may be set up by the defendant, nor does it depend upon the character of the relief prayed for by the plaintiff. It refers entirely to the ground set forth in the plaint as the cause of action, or, in other words, to the media upon which the plaintiff asks the court to arrive at a conclusion in his favour." 12. This Court in Oil & Natural Gas Commission v. Utpal Kumar Basu and Ors. (1994 (4) SCC 711) held that the question as to whether the court has a territorial jurisdiction to entertain a writ petition, must be arrived at on the basis of averments made in the petition, the truth or otherwise thereof being immaterial. 13. This Court in Oil and Natural Gas Commission's case (supra) held that all necessary facts must form an integral part of the cause of action. It was observed: "So also the mere fact that it sent fax messages from Calcutta and received a reply thereto at Calcutta would not constitute an integral part of the cause of action..." 17. Recently, in National Textile Corpn. Ltd. and Ors. vs. M/s Haribox Swalram and Ors. [JT 2004 (4) SC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opriate cases, the Court may refuse to exercise its discretionary jurisdiction by invoking the doctrine of forum conveniens. (See Bhagar Singh Bagga v. Dewan Jagbir Sawhany, AIR 1941 Cal; Mandal Jalan v. Madanlal, (1945) 49 CWN 357; Bharat Coking Coal Limited v. M/s Jharia Talkies & Cold Storage Pvt. Ltd. (1997) CWN 122; S.S.Jain & Co. & Anr. v. Union of India & Ors. (1994) CHN 445; M/s. New Horizon Ltd. v. Union of India, AIR 1994 Delhi 126)." 19. In view of authoritative pronouncements of the judgments by the Hon'ble Supreme Court, the arguments of learned Sr. Counsel that the proceedings out of the present show cause notice have started from a file of even number from which the proceedings were started against the respondent No.7, has no bearing giving rise to any cause of action to file the present writ petition before this Court. Further, merely because the petitioner-Firm is having a business transaction with respondent No.7, who is located in the State of Rajasthan and on certain transactions, the evasion of duty is alleged will not give any cause of action to the petitioner-Firm for filing writ petition before this Court for the simple reason that the evasion, if any, don ..... X X X X Extracts X X X X X X X X Extracts X X X X
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