9911796707
TMI Blog1999 (2) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... s. After the petitioner made arrangements for running the factory itself, it wrote on 20-4-1991 to the Superintendent, Central Excise, Podanur Range, Coimbatore-23 of its detention to resume manufacture in the said factory. It also informed the Superintendent that they were not going to manufacture any excisable items. To its surprise, it received a communication dated 2-5-1991 from the Superintendent, Central Excise, Podanur Range, 3rd respondent herein, that by order dated 7-2-1991 of the 3rd respondent, the plant and machinery in the premises were detained under Rule 230(1) of the Central Excise Rules, that the lease cannot hand over the plant and machinery to the petitioner and unless a sum of Rs. 2,82,201.57 duty liability of the lessee Modern Steel Industries and penalty of Rs. 2,000/- is paid, they cannot permit the petitioner to commence manufacturing activity. This was followed by a further communication dated 20-5-1991 by which the Superintendent of Central Excise, Podanur Division called upon the petitioner to pay the arrears of Rs. 2,84,201.57 due from Modern Steel Industries, failing which action would be initiated against the petitioner. Aggrieved by the communication ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 220 (Mad.)]. Neither the petitioner nor M/s. Modern Steel Industries so far produced any documents relating to the lease transaction to the Range Superintendent. Notwithstanding the above, not only M/s. Modern Steels but also the petitioner are liable to discharge the duty demanded in terms of Rule 230(2) of Central Excise Rules, 1944. In such circumstances, they prayed for dismissal of the writ petition. 4.In the light of the above pleadings, I have heard Mr. R. Thiagarajan, learned Senior Counsel for the petitioner and Mr. T.L.L. Ramakrishnan, learned Additional Central Government Standing Counsel for the respondents. 5.On 1-4-1987 the petitioner leased out its Plant, Machinery and Building to Lessor. Modern Steel Industries, Coimbatore for Manufacturing M.S. Bars, M. S. Angle and M. S. Plates. It is the definite case of the petitioner that on the expiry of the lease period, the lessees surrendered the possession of the Plant, Machinery and building to the petitioner on 10-1-1991. It is also their case that the handing over and taking over of possession are vouched by records. After the petitioner made arrangements for running the factory itself, it wrote on 20-4-1991 to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d-set of papers. 6.In such circumstance, according to him, it is not open to the third respondent to claim the duty payable by M/s. Modern Steel Industries in respect of wrong availment of the benefit under Notification No. 208/83 from the petitioner much later to the taking back of plant and machinery from the lessee. It is seen from the records that on 7-2-1991, the Assistant Collector of Central Excise, Pollachi ordered detention of goods, Plant and Machinery under Rule 230 of Central Excise Rules, 1944 pending payment of demand. The said detention order was executed by the Superintendent of Central Excise, Podanur on 13-2-1991 and a copy of the detention Mahazar was served on the partner of M/s. Modern Steel Industries (lessee) who was present at the time of detention at the factory. It is further seen that in the meanwhile, M/s. Modern Steel Industries filed Writ Petition No. 4830/91 before this Court challenging the detention order of the Additional Collector. There is no dispute that the said writ petition filed by the lessee was dismissed on 10-4-1991 confirming the order of detention passed by the Additional Collector of Central Excise, Coimbatore. As rightly contended b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment regarding the said surrender on 10-1-1991. It is also the definite case of the respondents that neither M/s. S.B. Steels nor M/s. Modern Steel Industries produced any document relating to the lease transaction to the Superintendent of Central Excise, Podanur Range. Accordingly they are right in assuming that the transaction as a whole does not appear to be a bona fide one. 8.In terms of Rule 230(2) of Central Excise Rules, 1944, nor only M/s. Modern Steel Industries, but also M/s. S.B. Steels are liable to discharge the duty demanded. The said Rule is reproduced hereunder :- "RULE 230 : Goods, Plant and Machinery chargeable with duty not paid :- (1) When the duty leviable on any goods in owing from or by, any person carrying on trade or business, whether as a producer, manufacturer or as dealer in such goods, all excisable goods, and all materials and preparations from which any such goods, are made, and all plant, Machinery, Vessels, utensils, implements and articles for making or manufacturing or producing any such goods, or preparing any materials, or by which trade or business is carried on, in the custody of possession of the person carrying on such trade or busines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee failed to pay the amount of duty, the Assistant Collector of Central Excise passed a detention order on 7-2-1991 detaining the goods, Plant and Machinery under Rule 230 of the said Rules pending payment of demand. If really the Plant and Machinery were not in the hands of the lessee, the same could have been brought to the notice of the third respondent at the time of passing the detention order. Likewise, as stated above, the same was also not brought to the notice of this Court when the said detention order was challenged. In such a circumstances, the said decision is not helpful to the petitioner's case and the respondents are justified in passing the impugned order. 9.Regarding the other contention that as per Section 11A of the Central Excise Act, 1944, recovery of duties not levied or not paid, it is stated that the period of limitation is six months from the relevant date. By pointing cut the said clause regarding the limitation for taking action to recover the said amount, Mr. R. Thiagarajan, learned Senior Counsel for the petitioner, would contend that in any event, in view of the said provision, the action taken by the respondents in the year 1991 is clearly barred ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
