1984 (8) TMI 48 - HC - Central Excise

Court rules in favor of petitioner regarding excise duty refund due to ineffective communication of Withdrawal Notification.

The court held that the Withdrawal Notification rescinding an earlier Exemption Notification became effective for the petitioner from the date they were ... Effectiveness of subordinate legislation depends on publication in the Official Gazette and actual notification to the public - publication in the Official Gazette is ordinarily the mode of bringing delegated legislation to notice, but printing alone without making the Gazette available for sale does not suffice - rule 8(1) of the Central Excise Rules - mode and effect of notifications withdrawing exemptions - illegality of duty collection without authority of law and entitlement to restitution under Article 226 read with Article 265Effectiveness of subordinate legislation depends on publication in the Official Gazette and actual notification to the public - publication in the Official Gazette is ordinarily the mode of bringing delegated legislation to notice, but printing alone without making the Gazette available for sale does not suffice - rule 8(1) of the Central Excise Rules - mode and effect of notifications withdrawing exemptions - Date from which Notification No. 284/82-CE rescinding Notification No. 30/79 takes effect in relation to the petitioner - HELD THAT: - The court examined whether mere printing of the Official Gazette containing the rescinding notification, or the date borne by the Gazette, establishes the date on which the notification became operative. The court held that for notification under r. 8(1) the decisive requirement is not the date printed or the act of printing, but the date on which the Gazette containing the notification was made available to the public such that the public is put on notice. Printing and internal communication (for example by telex to officials) do not substitute for public notification. On the facts the Gazette containing Notification No. 284/82, though dated November 30, 1982, was placed on sale for the public only on December 8, 1982, and the petitioner received direct communication from the Department on December 6, 1982 (received December 7, 1982). Accordingly, insofar as the petitioner is concerned the rescinding notification became effective only on December 7, 1982.Notification No. 284/82-CE took effect for the petitioner only from December 7, 1982.Publication in the Official Gazette is ordinarily the mode of bringing delegated legislation to notice, but printing alone without making the Gazette available for sale does not suffice - rule 8(1) of the Central Excise Rules - mode and effect of notifications withdrawing exemptions - Validity of the Assistant Collector's order (O.C. No. V/4/30/103/82-T3 dated February 22, 1984) upholding operative date of Notification No. 284/82 as November 30, 1982 - HELD THAT: - The Assistant Collector had maintained that the rescinding notification was operative from the date appearing in the Gazette (November 30, 1982). Applying the legal principle that notification requires the public to be put on notice and that mere printing without release does not satisfy that requirement, the court found the Assistant Collector's conclusion inconsistent with the factual position that the Gazette was not available to the public until December 8, 1982, and that the petitioner was put on notice only on December 7, 1982. For these reasons the order declaring the notification effective from November 30, 1982, could not stand.The Assistant Collector's order of February 22, 1984, is quashed insofar as it holds the notification effective from November 30, 1982.Illegality of duty collection without authority of law and entitlement to restitution under Article 226 read with Article 265 - effect of lack of due notification on collection of duties - Whether moneys collected from the petitioner for clearances between November 30, 1982 and December 7, 1982 must be refunded - HELD THAT: - Because the rescinding notification had no legal efficacy in relation to the petitioner prior to December 7, 1982, any differential duty collected from the petitioner for clearances effected before that date was collected without legal authority. The court held that collection under a notification that is not in force vis-a-vis the petitioner is an unlawful imposition; the Government is therefore bound to repay such amounts. The court exercised its discretionary writ jurisdiction under Article 226 to order restitution, rejecting the respondents' contention that statutory limitation or procedural refund mechanisms should bar relief where the collection itself lacked legal sanction and the respondents declined to consider refund on merits.The moneys collected from the petitioner in enforcement of Notification No. 284/82-CE for the period antecedent to December 7, 1982 (i.e., November 30, 1982 to December 7, 1982) are to be refunded.Final Conclusion: The writ petitions are allowed: Notification No. 284/82-CE is held to have become effective for the petitioner only from December 7, 1982; the Assistant Collector's order treating the notification as effective from November 30, 1982 is quashed; and the respondents are directed to refund the differential duty collected from the petitioner for clearances between November 30, 1982 and December 7, 1982. Issues Involved:1. Effective date of Withdrawal Notification.2. Refund of excise duty collected for the period before the effective date.Summary:Issue 1: Effective Date of Withdrawal NotificationThe petitioner, a cigarette manufacturer, contested the effective date of the Withdrawal Notification No. 284/82-CE dated November 30, 1982, which rescinded the earlier Exemption Notification No. 30/79-CE. The petitioner argued that the Withdrawal Notification should be effective only from December 8, 1982, the date it was made available to the public. The court examined the legal requirement for notifications to be published in the Official Gazette and concluded that mere printing without making it available for public sale does not constitute effective notification. The court held that the Withdrawal Notification became effective for the petitioner only from December 7, 1982, the date the petitioner was notified by the third respondent.Issue 2: Refund of Excise DutyThe petitioner sought a refund of the excise duty collected for the period from November 30, 1982, to December 7, 1982, arguing that the Withdrawal Notification was not effective during this period. The court agreed, stating that the duty collected during this period was without the authority of law under Article 265 of the Constitution of India. The court directed the respondents to refund the excise duty collected from the petitioner for the period from November 30, 1982, to December 7, 1982. The court also clarified that the restrictions as to limitations found in the Act and the Rules cannot impede the writ jurisdiction of the court under Article 226 of the Constitution of India.Conclusion:The court allowed the writ petitions, declaring that the Withdrawal Notification took effect only from December 7, 1982, for the petitioner and directed the refund of the excise duty collected for the period from November 30, 1982, to December 7, 1982. No order as to costs was made.