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TMI Blog1988 (9) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... and 10-A of the Central Excise Rules, hereinafter referred to as 'the Rules'. Rule 10-A had been struck down by this Court. Rule 10 governs the case of non-payment or short-levy. Under the law, the authorities have no power to collect any duty beyond the period of three months prior to the date of demand notice, and this has been finally decided in W.P. No. 4145 of 1975 and which applies to the facts and circumstances of this case. Hence, the suit had been filed to recover the illegally collected amount with interest at 12 per cent from date of payment. 2. Third defendant stated that plaintiff was allowed concessional rate of duty at the rate of Rs. 3.75 per gross from 22-7-1967 to 31-12-1974, as per Notification No. 162 of 1967, dated 21-7-1967. This Notification was amended by Notification No. 205 of 1967, dated 4-9-1967, which introduced certain conditions for grant of concessional rate of Rs. 3.75 per gross. Plaintiff did not comply with the conditions, and hence was bound to pay Rs. 4.30 per gross. As a result of the decision of the High Court of Madras striking down clauses (b) and (ia) of the proviso to Notification No. 162 of 1967 amended by Notification No. 205 of 1967, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t dated 4-11-1974, the Department could make a demand for payment of Rs. 4.30 per gross, because until then, it had to claim only at the rate of Rs. 3.75 per gross and which had prejudiced the rights of the Department. Thereafter, even though Department was entitled to collect the entire amount due, by Trade Notice (CE) 104/75, dated 27-6-1975. Union of India thought that to alleviate the difficulties of match manufacturers, who would be liable to pay huge amounts, had extended a concession that if one-third of the amount is paid by 30-8-1975, then two-thirds of the dues outstanding would not be recovered. Availing of the concession so extended and without any protest, plaintiff having made the payment, it cannot now take a different stand, as it had been coerced to make the payment by threats in the demand notice. 5. Mr. Krishnan, learned Counsel for plaintiff, in his strenuous submissions would plead that, the claim made by the Department in the demand notice in Ex.A-1 dated 4-6-1975 to pay a sum of Rs. 33,152.62, and alongside threatening that in the event of non-payment as demanded, clearance of goods would not be allowed, was an illegal demand by virtue of Section 72 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder threat of refusal to clear the goods. It is further pleaded that as per Section 72 of the Contract Act, it is implied that the demand made was vitiated by coercion. 7. This Court struck down certain clauses in Notification Nos. 162 and 205 of 1967. But for it, the plaintiff would have been always demanded to pay duty at the rate of Rs. 4.30 per gross. He did not satisfy the conditions for grant of concessional rate of Rs. 3.75 and, therefore, in law, he was liable to pay only Rs. 4.30 per gross. The demand could not be made by defendants because the appeal filed by it against the said judgment was pending in the Supreme Court, and it allowed it only on 4-11-1974. Therefore, for this period from 22-7-1967 to 31-12-1974, a sum of Rs. 33,152.62 became payable. It was on representations made by the trade, Union of India resolved to collect only one-third of the amount which had become due, and hence issued Ex. B-1 trade notice extending concession which was available only till 30-8-1975. Responding to this concession, plaintiff had paid one-third of the amount. Ex. A-2 produced by plaintiff shows that it had paid the amount of Rs. 11,839.20 on 17-6-1975 under protest. It was a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd having been made demand within the time provided thereunder; the claim that defendants had no authority to collect the amount after issue of trade notice, has to necessarily fail. 9. To claim that the defendants have practised coercion by extending threat, as pleaded in paragraph 6 of the plaint, learned Counsel relied on some decisions. The learned Judge held that any payment made in pursuance of Ex. A-1 cannot be said to be a voluntary payment. In Sri Raja Vankatadri Apparao Bahadur v. Timmaraju Venkatakutumbarao (AIR 1941 Madras 635) (D.B.), it was held that, if a payment was made into Court by plaintiff, when he applied for an order to set aside the sale of his property in execution of a decree against someone else, though not made under protest, it must be considered to be a payment made under coercion, within the meaning of Section 72 of the Contract Act. It was pointed out in Kanhaya Lal v. National Bank of India Ltd. (I.L.R. 40 Cal. 598) by the Privy Council that the word 'coercion' used in Section 72 is used in the general and ordinary sense of the word, and that its meaning is not controlled by the definition in Section 15 of the Contract Act. A Division Bench in Kar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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