Jurisdictional defect in excise notice barred differential duty recovery under Rule 9(2); writ of prohibition was maintainable.

Rule 9(2) of the Central Excise Rules, 1944 could not be invoked to recover differential excise duty where removals were not clandestine and had taken place with departmental knowledge after filing the required forms. The show cause notice disclosed a jurisdictional defect on its face because the provision contemplated duty, penalty and confiscation for contravention of Rule 9(1), not recovery of differential duty in these facts. A writ of prohibition was therefore maintainable and was issued, rendering the departmental notice unsustainable.

---

---

Issues: Whether the show cause notice proposing recovery of differential excise duty could be sustained under Rule 9(2) of the Central Excise Rules, 1944, and whether a writ of prohibition could issue on the ground of want of jurisdiction.

Analysis: The notice sought to recover differential duty after the departmental action under Rule 10A had been set aside and fresh proceedings were initiated under Rule 9(2). Rule 9(2) contemplates duty on excisable goods removed in contravention of Rule 9(1), together with penalty and confiscation, but it does not provide for recovery of differential duty in a situation where removal was not clandestine and had been made with departmental knowledge after filing the required forms. On the admitted facts, the attempt to invoke Rule 9(2) for differential duty disclosed a jurisdictional defect on the face of the notice.

Conclusion: The show cause notice could not be proceeded with under Rule 9(2), and the writ of prohibition was maintainable and deserved to be issued in favour of the assessee.

Final Conclusion: The proceeding was terminated by acceptance of the jurisdictional challenge, leaving the departmental notice unsustainable.

Ratio Decidendi: A writ of prohibition lies where the initiating notice itself reveals a clear lack of jurisdiction, and Rule 9(2) of the Central Excise Rules, 1944 cannot be used to recover differential duty in the absence of clandestine removal.

---