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Issues: (i) Whether the challenge to the detention memos under Rule 230 of the Central Excise Rules, 1944 should be entertained in writ jurisdiction; (ii) whether detention under Rule 230 authorised sealing of the petitioner's furnaces and other plant and machinery so as to prevent their use in the factory.
Issue (i): Whether the challenge to the detention memos under Rule 230 of the Central Excise Rules, 1944 should be entertained in writ jurisdiction.
Analysis: The detention was made in connection with alleged excise duty arrears and pending disputes regarding abatement and redetermination of capacity. An appeal against detention was available under the statutory scheme, and the petitioner could also pursue grievances before the departmental authorities. In these circumstances, the writ court declined to decide whether the detention was wholly or partly justified.
Conclusion: The challenge to the detention memos was not entertained on merits in writ jurisdiction.
Issue (ii): Whether detention under Rule 230 of the Central Excise Rules, 1944 authorised sealing of the petitioner's furnaces and other plant and machinery so as to prevent their use in the factory.
Analysis: Rule 230 permits detention of excisable goods, plant and machinery and other articles for securing outstanding duty and preventing transfer or disposal. It does not authorise preventing the normal use of the detained plant and machinery in the manufacturing process. Mere user does not amount to transfer or disposal, and the statutory power of detention cannot be expanded into a power to stop operations by sealing the equipment.
Conclusion: The sealing of the furnaces, diesel generating set, cranes and transformers was unauthorised, and the petitioner was entitled to use them despite detention.
Final Conclusion: The petition succeeded only to the limited extent of removal of seals from the detained plant and machinery, while the rest of the challenge to the detention action failed.
Ratio Decidendi: Rule 230 of the Central Excise Rules, 1944 permits detention to secure outstanding duty and prevent transfer or disposal, but it does not empower the authorities to seal plant and machinery so as to prohibit its normal use.
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