AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2011 (4) TMI 844
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....not received the challans within the period of 180 days from the date of despatch of the finished products from their Unit at Chinchpada and erroneously, passed the order directing the petitioner to reverse the entry in respect of Cenvat Credit availed by them. 3.The contention of the respondent, as seen from the counter affidavit, is that the writ petition is not maintainable, as there is a statutory remedy, which is efficacious one and therefore, the petitioner cannot challenge the notice without exhausting the statutory remedies. 4.It is further contended by the learned counsel for the respondent that a reading of Rule 4(5)(a) and 4(6) of the Cenvat Credit Rules, 2004, would make it clear that there is no necessity to issue show cause notice and having regard to the admitted facts, the order was passed, as the petitioner failed to prove that they received the challans within a period of 180 days from the date of despatch from their Unit at Chinchpada and therefore, the respondent has rightly directed the petitioner to reverse the entry in respect of the Cenvat Credit already availed by them and directed them to pay the said amount along with interest. 5.Besides ....
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....ns pertaining to the period from 01.03.2009 to 30.09.2009. 9.According to the respondent, the challans pertaining to the above period were seized at the Madurai Railway Station on 09.04.2010 and therefore, the petitioner has failed to comply with the vital condition viz., not in possession of job work challans from job workers within 180 days, the impugned notice was issued directing the petitioners to reverse the amount of Rs.315,91,42,459/- along with interest. 10.In the impugned order also, it was stated clearly that the deadline of 180 days for the return of the challans sent on 01.03.2009 ended on 28.08.2009 and the deadline for the return of the challans sent on 30.09.2009 ended on 29.03.2010 and the challans pertaining to the above period were seized only on 09.04.2010, which is beyond the period 180 days and therefore, the petitioner was directed to reverse the above said amount. 11.As stated above, we will have to see whether the notice issued by the respondent directing the petitioner to reverse the amount is liable to be set aside on the ground of violation of principles of natural justice or not? 12.Mr.M.Vekataraman, the learned Senior Co....
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....s. Commissioner of Income Tax, Central-I and another and (1989)1 SCC 764, in the case of H.L.Trehan and others vs. Union of India and others, in support of his contention. 17.The learned Senior Standing Counsel appearing for the respondent, Mr.B.Vijaya Karthikeyan, has relied upon my judgment rendered in W.P.(MD)No.6090 of 2009 between N.Narayanan vs. The Securities and Exchange Board of India (SEBI) & others and wherein I have held that when the alternative remedy is available, this Court has no jurisdiction to entertain the writ petition and therefore, contended that the writ petition is liable to be dismissed on that ground that the petitioner has to exhaust their remedy available under the statute. 18.In the judgment reported in (2005)6 SCC 499, in the case of State of H.P. and others vs. Gujarat Ambuja Cement Ltd and another, the Honourable Supreme Court discussed the exceptions to the doctrine of exhaustion of statutory remedies as follows:- "The power relating to alternative remedy has been considered to be a rule of self-imposed limitation. It is essentially a rule of policy, convenience and discretion and never a rule of law. Despite the existence o....
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....na [(2002) 7 SCC 484 : 2002 SCC (L&S) 1075] and GKN Driveshafts (India) Ltd. v. ITO [(2003) 1 SCC 72]. 20.In Harbanslal Sahnia v. Indian Oil Corpn. Ltd.[(2003) 2 SCC 107] this Court held that the rule of exclusion of writ jurisdiction by availability of alternative remedy is a rule of discretion and not one of compulsion and the Court must consider the pros and cons of the case and then may interfere if it comes to the conclusion that the petitioner seeks enforcement of any of the fundamental rights; where there is failure of principles of natural justice or where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged." 21.In G. Veerappa Pillai v. Raman & Raman Ltd.[1952 SCR 583 : AIR 1952 SC 192]; CCE v. Dunlop India Ltd. [(1985) 1 SCC 260 : 1985 SCC (Tax) 75 : AIR 1985 SC 330]; Ramendra Kishore Biswas v. State of Tripura [(1999) 1 SCC 472 : 1999 SCC (L&S) 295 : AIR 1999 SC 294]; Shivgonda Anna Patil v. State of Maharashtra [(1999) 3 SCC 5 : AIR 1999 SC 2281]; C.A. Abraham v. ITO [(1961) 2 SCR 765 : AIR 1961 SC 609]; Titaghur Paper Mills Co. Ltd. v. State of Orissa [(1983) 2 SCC 433 : 1983 SCC (Tax) 131 : AIR 1983 SC 603]; H.....
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....ion of the principles of natural justice. We may add that where the proceedings itself are an abuse of process of law the High Court in an appropriate case can entertain a writ petition." 19.In the judgment reported in (1989)1 SCC 264, the Honourable Supreme Court has held that when the adverse action involved civil consequences, the principles of natural justice has to be followed. The same principle is also reiterated in the judgment reported in (2008)14 SCC 151 [Sahara India (Firm), Lucknow vs. Commissioner of Income Tax, Central-I and another]. 20.In the judgment reported in 2008(14) SCC 151, in the case of Sahara India (Firm), Lucknow vs. Commissioner of Income Tax, Central-I and another, the Honourable Supreme Court dealt with section 142(2-A) of the Income Tax Act and held that even though, section 142(2-A) did not contemplate, giving an opportunity before passing any order as the power exercised under 142(2-A) leads to serious civil consequences, the requirement of observance of principles of natural justice is to be read into the said provision, even in the absence of express provision for affording an opportunity of pre-decisional hearing to an assessee. &....
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....itted to maintain the details of Part II and Part III of the challans through a computer net-work connection between Tuticorin and Silvassa and they were advised to file hard copies serially numbered, generated on a daily basis kept in a file for inspection of the excise officials, whenever required and as per the conditions, they were maintaining the records and documents on-line and the petitioner has to file valid documents to substantiate their case and therefore, submitted had opportunity been given to them, they would have proved that there was no violation of permission granted to them and they were maintaining the challans as per the permission granted and without giving them opportunity, the respondent on the basis of the alleged seizure of challans on 09.04.2010 at the Madurai Railway Station presumed that the petitioner's Company have not received the challans within the period of 180 days and passed the impugned order. 26.According to me, even though Rule 4(5)(a) and 4(6) are silent about the issuance of show cause notice, having regard to the facts stated above, the issuance of show cause notice before passing the order can be read into those provisions, before....
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.... days he has to pay the interest or even after the receipt of the challans after 180 days he is entitled to take Cenvat Credit. 28.Considering all these aspects, I am of the opinion that the respondent ought to have been given an opportunity to the petitioner to show cause why the entry should not be reversed regarding the Cenvat Credit already availed by them and without giving an opportunity, the respondent has passed the impugned order and therefore, there is violation of principle of natural justice and the order is liable to be set aside. 29.It is submitted by the learned Senior Counsel appearing for the petitioner that the respondent pre-determined the matter while passing the impugned order and therefore, as per the judgment reported in (2006)12 SCC 33, [Siemans Ltd., vs. State of Maharashtra and others], the writ is maintainable and the impugned order is liable to be set aside. 30.The learned Senior Counsel further submitted that the order, which is impugned in W.P.(MD)No.8135 of 2010 passed by the first respondent, also would prove that there was pre-determination of issue and therefore, the impugned order is liable to be set aside. 31.I am not abl....
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....f Central Excise, as annexed in the list attached to the communication. 35.It is submitted by the learned Senior Counsel appearing for the petitioner's Company that pre-determination mind of the 1st respondent is proved by the communication sent by the 1st respondent to various Officers and as a result of the communication, various buyers of the petitioner's Company were asked to reverse their entries and the 1st respondent has came to the definite conclusion that there was total violation of CENVAT Rules and the petitioner's Company has evaded the customs duty till 2000 Crores and therefore, the communication issued by the 1st respondent has to be stayed. 36.On the other hand, the learned Senior Standing Counsel appearing for the respondents submitted that it is not an order passed by the 1st respondent and it is only an internal communication between the Officials and that cannot be challenged in the writ petition and in the said communication, the 1st respondent has only stated his opinion and called for the report from the other Officials about the action taken at their end to update the records and that cannot be challenged. 37.According to me, a perusal of th....