Civil suit maintainable against excise demand issued beyond Rule 10; statutory bars do not cover unauthorised notices.

A civil suit remains maintainable where an excise demand is challenged as ultra vires the governing rules, because statutory remedies and bars do not protect acts done without jurisdiction. Rule 10 governed recovery of short-levied duty within a three-month period, while Rule 10A operated only residually where no specific rule applied. A demand issued outside Rule 10 could not be validated by invoking Rule 10A. Sections 35, 36 and 40 did not bar the suit, since they do not shield unauthorised or illegal demands made beyond the officer's powers. The civil court therefore had jurisdiction to examine the validity of the excise notices.

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Issues: Whether the civil court had jurisdiction to entertain the suits challenging the excise notices, and whether the notices for additional duty were validly issued under Rule 10A instead of Rule 10 of the Central Excise Rules, 1944.

Analysis: The dispute turned on whether the Central Excise Officer acted within the powers conferred by the Act and the Rules. Rule 10 governed recovery where duty had been short-levied and imposed a three-month limit, while Rule 10A was a residuary provision applicable only where no specific rule covered the demand. If Rule 10 was the proper provision, a demand issued after the prescribed period could not be sustained by invoking Rule 10A. The court held that the challenge was to the legality and jurisdiction of the demand itself, not merely to an order passed in the ordinary exercise of statutory power. Sections 35 and 36, which provide appellate and revisional remedies against orders passed under the Act or the Rules, did not bar a suit where the officer had acted beyond authority. Section 40 also did not exclude the suit, because it protected only acts or orders done in good faith under the Act, not an illegal or unauthorised demand.

Conclusion: The civil court had jurisdiction, the notices were beyond the officer's powers, and the demand could not be sustained under Rule 10A. The finding was in favour of the assessee.

Ratio Decidendi: A civil suit is maintainable where an excise authority issues a demand outside the scope of the statutory rule governing the matter, because the statutory bar on suits does not protect acts done without jurisdiction or beyond the powers conferred by the Act and the Rules.

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