Court dismisses writ petitions, orders petitioners to pay dues, interest, costs.

The court dismissed both writ petitions, holding the Petitioners liable to pay the amounts due along with interest. The court directed the Petitioners to pay costs to the Respondents quantified at Rs. 50,000 within four weeks from the date of receipt of a copy of the judgment.

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Issues Involved:
1. Legality of the recovery of Rs. 49.28 crores and the demand notice dated 29th October 2012.
2. Validity of notification No.68/63-CE dated 4th May 1963.
3. Validity of the letter dated 5th September 2012 demanding Rs. 311,16,49,260/- along with interest.
4. Applicability of interest on the amounts due under the Central Excise Act, 1944.
5. Legality of the demand for interest on the finalised provisional assessment.

Issue-wise Detailed Analysis:

1. Legality of the recovery of Rs. 49.28 crores and the demand notice dated 29th October 2012:
The Petitioners challenged the recovery of Rs. 49.28 crores and the demand notice dated 29th October 2012 as ultra vires of the Central Excise Act, 1944, and violative of Articles 14 and 19(1)(g) of the Constitution of India. They argued that no interest is chargeable under the provisions of the Act and sought a refund of amounts collected in excess by the Respondents. The court, however, found that the Petitioners were liable to pay the amount as directed by the Supreme Court and that the demand for interest was legitimate and sustainable.

2. Validity of notification No.68/63-CE dated 4th May 1963:
The Petitioners contended that notification No.68/63-CE dated 4th May 1963, which made section 142(1)(c)(ii) of the Central Excise Act, 1944 applicable to them, was illegal, without jurisdiction, and ultra vires of the Central Excise Act, 1944. The court did not find merit in this contention and upheld the validity of the notification.

3. Validity of the letter dated 5th September 2012 demanding Rs. 311,16,49,260/- along with interest:
The Petitioners questioned the validity of the letter dated 5th September 2012 issued by the Assistant Commissioner of Central Excise, Kurla Division, Mumbai-I, demanding Rs. 311,16,49,260/- along with interest. The court found that the demand for interest was made only after the order of the Supreme Court, which crystallized the liability. The court held that the demand for interest was legitimate and sustainable.

4. Applicability of interest on the amounts due under the Central Excise Act, 1944:
The Petitioners contended that no interest was payable on the amounts due as the provisional assessment was finalized before the introduction of the provision for charging interest on 1st July 2001. The court, however, held that the demand for interest was legitimate as the liability to pay interest was reiterated in the acceptance of the proposal for instalments and the Petitioners had acted upon the same. The court directed that interest be paid from the date on which it was first demanded by the Respondents, namely 5th September 2012.

5. Legality of the demand for interest on the finalised provisional assessment:
The Petitioners argued that the demand for interest was unsustainable under section 11A as the duty confirmed by the Supreme Court was not an amount determined under section 11A nor an amount being paid voluntarily. The court, however, held that the interest was not demanded under section 11AA but pursuant to the instalments facility granted in accordance with the Notification dated 2nd May 1996. The court found that the Petitioners were liable to pay interest at the rate of 18% per annum from the date of the order of the Supreme Court dated 29th August 2012 till the date of realization.

Conclusion:
The court dismissed both writ petitions, holding that the Petitioners were liable to pay the amounts due along with interest. The court directed the Petitioners to pay costs to the Respondents quantified at Rs. 50,000/- within four weeks from the date of receipt of a copy of the judgment.

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