TaxTMI 
TaxTMI 
2010 (10) TMI 423
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....re and export of various goods. The said activity of export is carried out by the Petitioners in its capacity as a trading house whereunder the Petitioners obtain duty paid goods and subject the said goods to process of manufacture as understood in excise law and then export it to various countries. The Petitioners at the relevant time, were in the activity of export of tea which was classifiable under TI-3 of the first Schedule to the Central Excises and Salt Act, 1944 (the Excise Act for brevities sake). Under the scheme of levy of excise, Tea was required to bear duty of excise first at the garden stage and then at the packing stage after it was blended and packed. The Petitioner obtained Tea from gardens which was blended, packed and exported. The Central Government under Rule 12A of the Central Excise Rules was empowered to grant a rebate when finished goods were exported. Such rebate was in respect of duties of excise paid on raw materials used in the manufacture of such finished goods. In exercise of powers conferred by the said Rule 12A, the Central Government issued Notification No. 166/81 dated 23-9-1981 directing that rebate of duty of excise @ 0.40 per kg. shall be allo....
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....ntial quantities of tea and earned valuable foreign exchange to the tune of approximately Rs. 10.20 crores. In view of the drawback rate fixed by the Respondent No. 1, in terms of the Drawback Rules, the Petitioners were entitled to the drawback amount of Rs. 47,72,525/- which was after scrutiny and verification, granted and paid to the Petitioners. 4. It appears that on 27-6-1986 the Petitioners made another application for fixation of rate of drawback in respect of tea exported. The Petitioners were in expectation that the said application would be considered in the same manner in which the earlier application was considered. However, whilst the said application was pending consideration, the Respondent No. 1 issued a letter dated 19-1-1987 whereby it sought to retrospectively take away the right conferred on the Petitioners by rate letter dated 4-4-1986. Since the said action of the Respondent No. 1 was, according to the petitioners, in violation of law, the Petitioners challenged the said action by way of filing Writ Petition No. 992 of 1987 in this Court. This Court disposed of the said Petition by an order dated 24-4-1987. By which order the Respondents were restrained ....
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....dated 11-3-2003 mandated hearing to be granted to the Petitioners, the officer on Special Duty (Drawback) of the Respondents purported to pass an order on 15-4-2004 without affording a personal hearing to the Petitioners. This resulted in the Petitioners filing Writ Petition No. 548 of 2005 challenging the said ex parte order dated 15-4-2004 and the letter dated 12-8-2004 inter alia on the grounds mentioned in the said Petition. The said Writ Petition came to be disposed of by order dated 19-4-2005, by which order, the order dated 15-4-2004 came to be set aside and the Respondents were directed to pass a speaking order and time for passing speaking order was further extended by eight weeks. In terms of the said order dated 19-4-2005, the Respondents fixed hearing on 21-7-2005 on which day the Petitioner appeared through their advocate and solicitor before the 2nd Respondent on 21-7-2005 and made detailed submissions in the matter both on jurisdiction as well as on merits which were contained in the written submission dated 19-7-2005. The Respondents again filed a Notice of Motion No. 396 of 2005 in writ Petition No. 548 of 2005 for seeking extension of time till 31-8-2005 for compl....
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.... No. 992 of 1987 in order to decide the matter at the earliest. The Petitioners had objected to the said communication by their letter inter alia pointing out to the Respondents that proceeding with the issue in Writ Petition No. 992 of 1987 at such a belated stage would be contrary to the principles of natural justice and would also involve contempt of court on the part of the authorities. 7. Though the aforesaid conspectus of facts disclose that the hearing was only to be in respect of issues arising out of Writ Petition No. 2611 of 1988 it is required to be noted that by the impugned order dated 20-9-2005 the issues in Writ Petition No. 992 of 1987 were also dealt with and by the impugned order revocation letters dated 19-1-1987 and 20-1-1987 issued in respect of brand rate letters No. (Bom.-305) dated 4-4-86 and brand rate letter (Cal-57) dated 22-7-86 were confirmed and accordingly recovery of the drawback amount with appropriate interest was ordered. It is further required to be noted that though no findings have been recorded in respect of the issues arising out of Writ Petition No. 992 of 1987 in the operative part of the order directions as mentioned herein above hav....
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..... 2611 of 1988 as the applications for extension of time were only in respect of the issues arising out of the said Writ Petition and never was there any mention of the issues arising in Writ Petition No. 992 of 1987. He further submitted that the Respondents in deciding the issues arising out of Writ Petition No. 992 of 1987 have thereby violated the principles of natural justice as no hearing was granted to the Petitioners in respect of the issues arising out of the said Writ Petition No. 992 of 1987. 11. Per contra, it is submitted by the learned counsel for the Respondents Mr. Jetly that the issues involved in Writ Petition No. 992 of 1987 and the issues involved in Writ Petition No. 2611 of 1988 are two sides of the same coin. The learned counsel for the Respondents submitted that the issues in Writ Petition No. 992 of 1987 though pertaining to revocation of the drawback granted to the Petitioners with retrospective effect are related to the issues in Writ Petition No. 2611 of 1988 inasmuch as the said Writ Petition is concerned, the issue is as regards rejection of the Petitioners' applications for fixation of brand rate. He therefore submitted that underlying issue in ....
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....n No. 2611 of 1988. It appears that the said Writ Petition was admitted by this Court, however, no interim reliefs were granted. The said Writ Petition ultimately came to be disposed of in terms of the Minutes of Order dated 11-3-2003. By the said order, the impugned communications were to be treated as show cause notices in respect of the various periods covered by each of the said communications. The Respondents were also directed to furnish such material as would be sought to be relied upon by the Respondents. The Petitioners were directed to file their written explanation to the show cause notices within eight weeks and the Respondents were directed to adjudicate upon the said show cause notices/communications after granting hearing to the Petitioners and to pass a speaking order on or before 31-8-2003. The said order dated 11-3-2003 reads thus :- "Parties to Petition have prepared minutes of order under Joint Signature. The same is taken on record and marked "X' for identification. Petition stands disposed of in terms of minutes of order handed in and marked "X". Rule made absolute as per minutes. No order as to costs." The said Minutes of Order dated 11-3-2003 read t....
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....ved communication dated 13-7-2005 from the Respondent No. 1 in its Ministry of Finance. What is relevant to note from the point of view of the present Petition is that in the said communication subject matter was the order passed in Writ Petition No. 548 of 2005 and the Petitioners were asked to remain present before the concerned officer on 21-7-2005 at 11 A.M. The Petitioners accordingly by their communication dated 19-7-2005 replied the said communication and in the said communication the Petitioners have referred to Writ Petition No. 548 of 2005 and issue arising out of Writ Petition No. 2611 of 1988 which were as regards the applications for fixation of brand rate. The Respondents again filed Notice of Motion No. 396 of 2005 in which an order came to be passed on 23-8-2005 by this Court again extending the time for passing the order. The impugned order ultimately came to be passed on 30-9-2005. As can be seen from the conspectus of facts as narrated above, the issue in Writ Petition No. 2611 of 1988 was in respect of the communications by which the applications of the Petitioners for fixation of brand rate were rejected. The Petitioners had also in Writ Petition No. 548 of 20....
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....rable merit in the submission of the learned counsel for the Petitioners that the impugned order is passed in breach of the principles of natural justice. Firstly as recorded by us earlier, the authorities had proceeded on the basis that the issues in Writ Petition No. 2611 of 1988 were only to be adjudicated as can be seen from the pleadings of the various proceedings filed in this Court relating to the compliance of the order dated 11-3-2003 passed in Writ Petition No. 2611 of 1988. Therefore clubbing the issues arising in Writ Petition No. 992 of 1987 without the petitioners being granted the opportunity to deal with the same as also heard in respect of the same would, in our view, be in the breach of the principles of natural justice. It is pertinent to note that except referring to the said Writ Petition in the subject column of the order, there is absolutely no reference to the issues arising in the said Writ Petition No. 992 of 1987 in the body of the impugned order except the operative part. Such facts therefore give an impression that the authorities have merely gone through the Motion of adjudicating upon the issues arising in Writ Petition No. 992 of 1987 without there b....