9911796707
TMI Blog1990 (9) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... rit Petition No. 7254 of 1975, but the writ petition was dismissed. An appeal was preferred against the dismissal of writ petition No. 7254 of 1975. A Division Bench of this Court, after elaborate discussion, came to the conclusion that the respondent-company in producing 'furacin Syrup' was not engaged in the process of manufacture so as to attract levy under Section 3 of the Central Excise and Salt Act, 1944. Consequently, Writ Appeal No. 251 of 1978 was allowed. The appellants questioned the judgment in writ appeal No. 251 of 1978 through Special Leave Petition No. (Civil) 10150 of 1985 before the Supreme Court of India. The Special Leave Petition was, however, dismissed on 5-11-1985. Since the appellants had collected excise duty amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of Rs. 32,75,720-91 and later on, on 10-7-1987 refunded a sum of Rs. 1,65,364-56. These refunds were, however, made during the pendency of the writ petition filed by the respondent, bearing No. 3267 of 1986. The respondent had sought a writ of mandamus directing the authorities to forthwith refund Rs. 34,61,711-66 on account of wrongly collected duty on "Furacin Syrup" for the period from 24-5-1972 to 21-1-1985 together with interest at the rate of 18 per cent per annum from 5-11-1985 till the date of payment. A learned Single Judge of this Court, after hearing the parties and noticing that during the pendency of the writ petition refund of Rs. 34,41,085-47 had been made, directed that the appellants would be liable to pay interest at 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n demand by the respondent. Undoubtedly there was no justification to withhold the amount after the judgment of the Supreme Court wherein the right to collect excise duty on "Furacin Syrup" had been negatived. In fairness, the appellants should have immediately made the refund. They did not do so. They withheld the amount unjustifiably and illegally. 4. The argument of the learned Counsel for the appellants, however, is that since the Central Excises and Salt Act, 1944 does not contain any provision for grant of interest on amounts wrongfully withheld by the department, the learned Single Judge should not have, in exercise of the writ jurisdiction, awarded interest at 12 per cent per annum in favour of the respondent. We cannot agree. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Thus, in an excise matter itself, interest was directed to be paid on the wrongfully withheld amount. 6. In the instant case, we find on the admitted facts that the appellant had wrongfully withheld the refund of Rs. 34,41,085-47, the excess duty which it had collected by mistake. No justification has been offered for withholding the refund of the amount from the respondent. These circumstances clearly attract the equitable jurisdiction of this Court and there can, therefore, be no doubt that interest could be allowed to the respondent on the amount which was wrongfully withheld from it. The facts are not in dispute in the case. The circumstances are tell-tale. Of course, there is no express provision of law, authorising the award of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court itself refunded the amount wrong-fully collected by it from the respondent. It chose not to do so without offering any justification for it and we are, therefore, of the opinion that substantial justice was done by the learned Single Judge in burdening the State with payment of interest for the money wrongfully withheld by it from the respondent. 7. In view of the aforesaid discussion, we find that the interest awarded at the rate of 12 per cent per annum by the learned single Judge for the period during which the amount had been wrongfully withheld from the respondent is perfectly justified, fair, reasonable and equitable. No cause has been made out for interference by this Court. There is no merit in this writ appeal which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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