TaxTMI 
TaxTMI 
2009 (9) TMI 92
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....ture and supply MS (SAW) pipes from their factory in MIDC Area at Butibori. The petitioner sought exemption from Central Excise duty and therefore, obtained a Certificate from the Collector under Notification No. 6/2006, dated 1st March, 2006, issued by Government of India, Ministry of Finance. In view of this certificate the petitioner claimed exemption from payment of excise duty from respondent No. 2 Commissioner, Central Excise. By his original order dated 29th December, 2008, the commissioner confirmed the demand of Central Excise duty at Rs. 5,44,70,146/- comprised of basic excise duty of Rs. 5.28 crores, Rs. 10.57 lacs towards Education Cess and Rs. 5.28 lacs towards Secondary and Higher Education Cess. The Commissioner also ordered recovery of interest on the said amount and imposed a penalty of an equal sum on the petitioner. He also slapped penalties of Rs. One Lac each on M/s. Nagarjuna Construction Company, principal contractor and Maharashtra Airport Development Company ("MADC" for short), which had awarded the contract. A penalty of Rs. Five Lacs was also imposed on a partner of the petitioner. 3. The petitioner preferred an appeal against this order before the Cus....
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....t concerned with the question as to whether the Tribunal, in passing the order under Section 35F of the Central Excise Act and Section 129E of the Customs Act in respect to waiver has validly exercised its jurisdiction or not. Therefore, in our view no substantial question of law has actually been framed by the appellant in this appeal." 6. The learned counsel for the petitioner relied on a judgment of Division Bench of High Court of Delhi in Union of India v. Classic Credit Ltd., reported at 2009 (236) E.L.T. 12 (Del.) = 2009 (13) S.T.R. 598 (Del.), where the Division Bench was considering an appeal against a common order passed by a learned Single Judge of Delhi High Court, holding that a writ petition under Article 226 of the Constitution of India is maintainable against an order of appellate Tribunal for Foreign Exchange, whereby the Tribunal had directed pre-deposit of 50% of the demanded penalty for considering the appeal. On behalf of appellant therein a preliminary objection was raised that the assessee should have preferred an appeal under Section 35 of the Foreign Exchange Management Act, 1999 ("FEMA" for short) and not a writ petition. The learned Single Judge directe....
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.... because it does not involve a substantial question of law need not be equated to non-availability of the remedy of an appeal. To put it differently, though situations in which appeals against orders regarding waiver of pre-deposit throwing up substantial questions of law may be extremely rare, or though practically it may be extremely difficult to get such appeals admitted, it does not follow that an appeal is not available. The difficulty in making out a case for entertaining an appeal cannot be equated to non-availability of remedy of appeal. Therefore, I hold that an order dealing with question of waiver of pre-deposit passed by the Central Excise Appellate Tribunal is subject to an appeal under Section 35G of the Act. 9. Next question would be whether in view of availability of this appeal it would be inappropriate for this Court to entertain the present petition. While availability of an alternate remedy would discourage a Court from entertaining a writ petition, it is a self imposed restriction, and therefore, merely because an alternate remedy is available, a petition under Article 226 would not be barred as rule. It would have to be found out if in the circumstances unf....
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....23B of the Constitution. He submitted that the Tribunal has been constituted under Section 129 of the Customs Act, 1962 as may be seen from the definition in Clause (aa) in Section 2 of the Central Excise Act. He submitted that since the Tribunal does not owe its existence to Article 323B of the Constitution the judgment in L. Chandra Kumar would not apply and the Single Judge would have jurisdiction to entertain the petition. 12. I have carefully considered these contentions. Since it is not shown that the Tribunal has been constituted under Article 323B of the Constitution and owes its existence to Section 129 of the Customs Act, observations in L.Chandra Kumar's case would not be applicable. Therefore, a petition could be entertained even by a Single Judge of this Court. 13. Having thus, clear the decks in entertaining the petition, I would now proceed to deal with the contentions raised by the learned counsel on merits. 14. The learned counsel for the petitioner submitted that for seeking waiver under proviso to Section 35F of the Act what is required to be shown is that the deposit of duty or penalty demanded would cause undue hardship to such person. He submitted tha....
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....th January, 2004 all items of machinery, including pipes for delivery of water from its source to the water supply plant, and from there to the storage facility, are exempt from the duty. Explanation in the said notification clarifies that the water supply plant referred to in this notification would include plants for purification of water, or for carrying out similar process, intended to make water fit for agriculture or industrial use. 18. The notification of 1st March, 2006 contains following explanation : "Explanation. - For the purposes of this exemption, water treatment plants includes a plant for desalination, demineralization or purification of water or for carrying out any similar process or processes intended to make the water fit for human or animal consumption, but does not include a plant supplying water for industrial purposes." 19. Both the notifications prescribe the same condition for claiming exemption, namely, obtaining a certificate from the Collector of the District in which project is located, to the effect that such goods are cleared for the intended use specified in the said notification. 20. It is not in dispute that the petitioner did obtain a....
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....ration form in Kedarnath's case and thus understood the same consequences should ensue for the non-compliance. Shri Narasimhamurthy says that there was no way out of this situation and no adjustment was permissible, whatever be the other remedies of the appellant. There is a fallacy in the emphasis of this argument. The consequence which Shri Narasimhamurthy suggests should flow from the non-compliance would, indeed, be the result if the condition was a substantive one and one fundamental to the policy underlying the exemption. Its stringency and mandatory nature must be justified by the purpose intended to be served. The mere fact that it is statutory does not matter one way or the other. There are conditions and conditions. Some may be substantive, mandatory and based on considerations of policy and some others may merely belong to the area of procedure. It will be erroneous to attach equal importance to the non-observance of all conditions irrespective of the purposes they were intended to serve." 22. The learned Assistant Solicitor General submitted, first, that the condition of obtaining exemption certificate from the Collector in the two notifications is not an empty forma....
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....ht to have persuaded the tribunal to grant full waiver. 25. I have carefully considered the arguments advanced. This is not shown to be a case covered by any judgment so as to conclude that waiver of pre-deposit was warranted. As to petitioner having a strong prima facie case, the question as to whether the petitioner was entitled to exemption would have to be decided by the Tribunal only after considering the arguments advanced on contentious facts. From the arguments advanced by the learned counsel for the petitioner and the material placed on record by him, it cannot be readily inferred that the entire pipeline or major part of the pipeline is certified to be used for domestic water supply. As for exemption under notification dated 8-1-2004 it cannot be a matter of inference merely because the petitioner was commissioned for supplying pipes for a project, initiated by MADC, popularly known as MIHAN project which would imply an industrial use as well. 26. The learned Assistant Solicitor General had also contended that the notification dated 8-1-2004 refers to a plant which makes water fit for agricultural or industrial use, whereas notification dated 1-3-2006 refers to a pl....