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TMI Blog1980 (2) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... factories is situated at Bangalore and tobacco products like cigarettes, tobacco and other tobacco products manufactured at Bangalore factory are subjected to excise duty under the Central Excises and Salt Act, 1944 (hereinafter referred to as the Act) within the jurisdiction of respondents 2 and 3. 3. The Company opted for what is known as `self-removal procedure' after the same was introduced in or about 1968. By this procedure, the Company is permitted to remove its manufactured goods outside the factory premises after the 2nd respondent has approved the price-list submitted by the Company and the duty on the sum total of such price-list has been worked out and paid by the Company. Prior to February 27, 1973, the Company on the basis of the self removal procedure was paying to the respondents, on the formula that the whole-sale price which is subjected to excise duty under Sec. 4(a) of the Act was inclusive of not only the cost of raw-materials, cost of manufacture, manufacturer's profits and the price charged to the wholesaler; but also the commission paid by the first wholesale dealer to his secondary wholesaler. However, it has been asserted in the pleadings, in this Writ P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h was rendered towards the end of December 1972, the Company came to realise that inclusion of commission of the secondary wholesale dealer in the wholesale price was a mistake made by them in calculating the excise duties at the relevant times. In these circumstances, on 27-2-1973 and on other dates, the petitioners wrote letters to the 3rd Respondent claiming refund in different sums totaling Rs. 1,17,86,357.04. After the above request was made in the form of letters, considerable correspondence took place between the company and 3rd respondents. In fact, the Company was permitted to file the written arguments in support of their claims for refund and also to address oral arguments. Thereafter, the various applications for refund came to be rejected by a composite order by respondent 3 in respect of all the five claims in the following terms : "Taking into consideration the pros and cons of their refund claims, I see no justification to accept them and therefore order that their claims are rejected." 6. The reasoning given in the said order or rejection is to be found in the paragraphs preceding the operative portion of the order as extracted above. It is significant to notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions between the Company and its wholesalers was at arms length in the usual course of business. The Revenue has further denied that all relevant times the Company paid excess duty under a mistake of law. On the other hand, the Revenue has asserted that those payments made before the Voltas decision was rendered by the Supreme Court were paid voluntarily. The Revenue has further denied that the Company paid the excess duty either under a mistake or misconstruction or account of the erroneous interpretation of Sec. 4(a) of the Act. In fact, it has been asserted for the Revenue that the position that followed after the decision in Voltas case by the Supreme Court was already existing on 14-8-1970 when the High Court of Judicature at Bombay had declared the law and therefore the knowledge of mistake of law was traceable to January, 1973, has been denied. It is further asserted that all refunds can only be made in terms of Rules 11 and 173-J of the Rules as they existed at the relevant time. Therefore, the authorities viz., respondents 1, 2, 3 and 4 correctly rejected those claims which did not confirm to the period of limitation prescribed under Rule 11 of the Rules. It is further ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not disputed, it is not now open to the respondents to take a contention that the case involves mixed questions of law end facts which are required to be decided only by a competent Civil Court. None of the orders made by the Revenue in regard to the claims of the Company have dealt with this aspect which is now sought to be made for the first time in this court. In spite of the decision in Miscellaneous Petition No. 1151/1975 in the High Court of Judicature at Bombay, I am inclined to take the view respectfully disagreeing with that judgment that the question raised in this writ petition can be decided in proceedings under Art. 226 of the Constitution and it is unnecessary to relegate the parties for adjudication in a Civil Court. There is one other reason to reject this contention. Admittedly, the 2nd and 3rd respondents without finding any difficulty in either fixing the point of time of limitation in accordance with Rule 11 of the Rules or in quantifying the accounts refundable, for the three claims allowed by the 4th Respondent. 13. Shri Ashok H. Desai, learned Counsel appearing for the Company, has contended that collection and retention of revenue without the authority o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant's contention and directed the re-assessment of import duty on two of the items on the basis of their invoice price and also directed the refund to the Appellant-Company the excess import duty charges on such items, because the revision petition was pending in respect of the two disputed items. The Appellant-company therein did not file separate appeals or revision reading other items which were similarly subjected to higher customs duty while the revision petition was pending, assuming that the Department would follow the decision rendered in the revision petition. Thus, the customs authorities granted refund on some of the items in whose case the invoice value had not been accepted and declined to refund the excess duty in respect of some other items on the sole grant that refund in respect of those items had not been claimed within the time prescribed by Sec. 40 of that Act. The appellant Patel India (P) Ltd., thereupon filed a writ petition in the High Court of Punjab at Delhi under Art. 226 of the Constitution pleading that Sec. 40 of that Act had no application that the Union of India was not entitled to appropriate or retain the said excess duty, the Appellant-Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eason to extend the principle and hold that no petition for the issue of a writ of mandamus would be normally entertained for the purpose of merely ordering a refund of money to the return of which the petitioner claimed a right. In fact there is no dispute that the case was so decided. But the learned Counsel has overlooked the use of the term "normally" in the decision. In other words, if properly understood, it cannot be said that in all cases that a mandamus will not issue for a mere refund of illegally collected taxes or other kind of compulsory levies. What the decision really laid down was that as far as possible the machinery provided under the Act must be made use of for obtaining the refund and nothing more. But, if, as in the instant case, on the basis of the ruling of the Supreme Court in Patel India's case Rule 11 of the Rules has no application, then there is no provision under the Act for claiming refund of excise duty which had been levied and collected contrary to law. In such a position, the trend of subsequent decisions of the Supreme Court has been to give relief to the petitioner on the facts of each case and has not laid any broad propositions of law for biddi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r a mere refund, the petitioner could not maintain a writ of mandamus. But in that case also all the earlier cases have been reviewed by the Supreme Court, but distinguished only on the facts of that particular case. That cannot be of much assistance to the Revenue on the facts of this case. In this case, it is not disputed that claim for refunds were made on various dates soon after the Voltas case was decided by the Supreme Court. On the extent of failure the Company perused the remedy under the provisions of the Act itself and it was only on failing to secure the appropriate relief in revision by the 1st respondent - Union of India that they have invoked the jurisdiction of this Court under Art. 226 of the Constitution. If this is borne in mind, then it cannot be held that this is a petition which is maintained only for purpose of refund and for no other purposes. On the other hand, it is clear from the pleadings and the prayer in the petition that the impugned order of the first respondent - Union of India in revision is sought to be set aside on the ground that there has been failure to exercise jurisdiction vested in it and the prayer for mandamus is only an consequential rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue Authorities and finally pad Rs. 3,59,113.68 ps., "under protest" for clearance of fertilisers under Rule 52. The payment, the company represented in unequivocal terms, was made as a measure in business expediency under the compulsion of circumstance. The payment in such circumstances it can be lost sight of the fact was never made under item 14HH or under any other provision of the Central Excises and Salt Act, 1944 : The ..."Payment was made under force of authority and in that sense under - "mistake" or under "coercion" no doubt in a question headed in unusual difficulty and intermixed with legal niceties and capable of no easy answer. In the instant case, it is not necessary to unravel the knot for the claim is made under the jurisdiction of Article 226 of the Constitution of India. There is power within that jurisdiction to exercise the powers of discretion of this Court as held in Bhailal Bhai's case - (6) 1964 (6) SCR 261 and as exercised by three of the Judges in the case of (4) (above) even if the claim is barred under the Status of Limitation." 25. Shri U.L. Narayana Rao, learned Counsel appearing for the respondents, has tried to distinguish all these decisions refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it palatable to our jurisprudence to turn down the prayer for high prorogative writs, on the negative pleas of `alternative remedy' since the root principle of law married to justice, is ubi jus ibi remedium." 29. I have extracted the above passage only to emphasise the trend of the decisions continously in the Supreme Court of India and the High Courts has been to use Art. 32 or Art. 226 of the Constitution, as the case may be, to further the ends of justice and not to deny the same on technicalities of law. In this view of the matter, the petitioners succeed, a writ in the nature of certiorari will issue quashing, Annexure `J' the order in revision made by the 1st respondent Union of India and also that portion of the order of the 4th respondent (Annexure `F') which limits the refund of the excess amount by the Company to a period of one year from the date of application. As I have held that Rule 11 of the Rules has no application and the limitation prescribed therein read with Rule 173-J of the Rules as it was then have no application to the facts of the case, a writ in the nature of mandamus will issue to the respondents 2 and 3 to refund the amounts in respect of the claims ..... X X X X Extracts X X X X X X X X Extracts X X X X
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