1986 (10) TMI 43 - HC - Central Excise

Dismissal of Petition Challenging Duty on Dross & Skimmings for Prematurity; Emphasizes Statutory Remedies

The court dismissed the petition challenging the duty on dross and skimmings under the Central Excises and Salt Act, 1944, as premature since the ... Exhaustion of alternate remedy - efficacious alternate remedy under Chapter VIA - extraordinary writ jurisdiction under Article 226 - assessability to excise duty under a tariff item - personal hearing before the assessing authorityExhaustion of alternate remedy - efficacious alternate remedy under Chapter VIA - extraordinary writ jurisdiction under Article 226 - Maintainability of the writ petition in view of the availability of an alternate statutory remedy under Chapter VIA of the Central Excises and Salt Act, 1944. - HELD THAT: - The Court held that Chapter VIA of the Act provides a real and efficacious alternate remedy, including appeal and further references up to the highest courts, which the petitioner had not availed. Although the writ petition was admitted in 1977, that fact alone does not preclude the Court from declining to entertain the petition on merits where the statutory remedy has not been exhausted and remains available and not time-barred. Reliance was placed on the principle that Article 226 should not be used to short-circuit statutory appellate machinery in revenue matters unless the alternate remedy is illusory or unavailable; Titagarh Paper Mills and Dunlop India Ltd. were cited for this proposition. Annexure 6 itself called for a personal hearing before the Assistant Collector and did not constitute a final adjudication; the petitioner could still appear, contest the demand and pursue the statutory route. The Court accordingly declined to decide the substantive question whether dross and skimmings are leviable to excise duty and dismissed the petition for failure to exhaust the statutory remedy. [Paras 5, 6, 7, 8, 9]Writ petition dismissed for non-exhaustion of the alternate statutory remedy under Chapter VIA; Court declined to decide the substantive question on excisability.Final Conclusion: The petition was dismissed without expressing any opinion on whether dross and skimmings are excisable; the petitioner remains at liberty to avail the remedy provided under Chapter VIA of the Central Excises and Salt Act, 1944. Issues:Challenge to legality of order advising to pay duty on dross and skimmings under Central Excises and Salt Act, 1944. Availability of alternate remedy under Chapter VIA of the Act.Analysis:The petitioner, a private limited company, challenged an order advising to pay duty on dross and skimmings, contending they are not excisable goods. The order was based on Item No. 68 of the First Schedule, which levied duty on all goods not elsewhere specified. The petitioner argued that dross and skimmings are not manufactured goods. The respondents claimed the petition was premature as the petitioner had not exhausted the alternate remedy under Chapter VIA of the Act. The court noted that the petitioner had not utilized the available remedy, which included appeal options up to the apex court. The court emphasized that the alternate remedy was real and efficacious, and the petitioner had not availed it, making the petition premature.The court highlighted that the petitioner did not appear before the Assistant Collector to contest the duty on dross and skimmings as advised in the order. Citing relevant case law, the court emphasized the importance of exhausting statutory remedies before approaching the court under Article 226 of the Constitution. The court noted that the petitioner's failure to utilize the available alternate remedy under Chapter VIA of the Act led to the dismissal of the petition. The court stressed that the alternate remedy was still open to the petitioner, and the petition could not be entertained without exhausting the statutory remedy.The court rejected the petitioner's argument citing a judgment from the Bombay High Court, emphasizing that the case law referred to a different tariff item and did not apply to the current situation. Despite not expressing an opinion on the duty leviability of dross and skimmings, the court dismissed the petition due to the petitioner's failure to exhaust the available alternate remedy under Chapter VIA of the Act. The court concluded by dismissing the writ petition without any costs, maintaining that the alternate remedy was still open to the petitioner for recourse.