TaxTMI 
TaxTMI 
2016 (7) TMI 1342
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....6394-6395, 7185-7186, 7245-7246, 7364 & 7366 of 2014, 260 & 340 of 2015 and 1036 of 2016 JUDGMENT [Judgment per : B.P. Dharmadhikari, J.]. - Considering the nature of controversy, the fact that interim orders are operating in all these matters and disposal of identical challenges by other High Courts, we have heard matters finally by issuing "Rule" in all, making it returnable forthwith, with the consent of all the parties. 2. In all these writ petitions filed under Article 226 of the Constitution of India, the challenge is identical, and relief claimed is also same. Writ Petition No. 1425 of 2013 has been accepted as a main matter representing the challenges. Learned Senior Counsel Shri M.G. Bhangde argued on behalf of petitioner therein. Senior Counsel A.S. Jaiswal advanced contentions on behalf of petitioners in Writ Petition No. 2703 of 2013. Rest of the learned counsel have adopted the same. Senior Counsel Shri S.P. Dharmadhikari has replied to the same for respondents Western Coal Fields (hereinafter referred to as "WCL" for short) and its holding Company M/s. Coal India Ltd. 3. The question raised is - Whether additional (differential) Central Excise duty paid ....
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....ause notice and summons under Section 14 of the Excise Act. In this hearing, Coal India was informed that after 2011 amendment to Finance Act, "Royalty and Stowing Charges" were not the other taxes and needed to be added to the coal value for determination of assessable value of coal. 7. On 8-3-2013, respondent No. 1 WCL issued notice and pointed out to petitioners that these two components needed to be treated as part of coal value and called upon them to pay the excise duty accordingly from 1-3-2013. Petitioners opposed it and on 12-3-2013, wrote back that they have calculated the purchase price on bid price as per terms of E-auction Scheme, as also sale price; and any retrospective deviation therein would put them to irreparable loss. They also point out that on 12-3-2013 itself Coal India has written to WCL to keep ready, only for audit purposes, the supplementary bills raised on petitioners for such differential duty for the period from 1-3-2011 to 28-2-2013. Thus, according to them, Coal India has not asked WCL to recover it from the petitioners. 8. It is urged that the reference of an issue by the Hon'ble Apex Court to its Larger Bench does not have the effect of....
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....Bench of Allahabad High Court in Writ Tax No. 460 of 2014 on 1-9-2014 - Logic Trading Private Ltd. v. Coal India Ltd. & Others [2014 (310) E.L.T. 263 (All.)], and by Jharkhand High Court W.P. (Tax) 3087 of 2013 with connected matters on 27-11-2015 - M/s. Gyan Enterprises Trade Division v. Coal India Ltd. & Others are relied upon to buttress the submissions. Orders of Chhattisgarh High Court in W.P. (T) 65 of 2013, dated 11-9-2013 - M/s. Hind Energy & Coal Beneficiation (India) Ltd. v. South Eastern Coal Fields Ltd. are also pointed out to support the prayer to dismiss these writ petitions. 11. Shri Bhangde, learned Senior Counsel, in reply submits that the legal principle that reference to the Larger Bench of Hon'ble Apex Court does not alter the settled law which needs to be enforced till such adjudication by the Larger Bench, was not required to be looked into by the Allahabad or the Jharkhand or the Chhattisgarh High Court. Similarly, point regarding the non-permissibility of extra-legal coercive recovery did not fall for consideration there. 12. The learned Single Judge of Chhattisgarh High Court after taking note of contention that the contract is not statutory one....
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....o the judgments of Chhattisgarh High Court, Allahabad High Court and Calcutta High Courts taking same view. 14. The Allahabad High Court judgment is the first Division Bench view in point of time which looks into Section 4(3)(d) of the Excise Act, arbitration clause and the reference made to Bench of 9 Judges in Mineral Area Development Authority & Ors. v. Steel Authority of India Ltd. & Ors. (supra) about nature of royalty and of question whether the majority view in State of West Bengal v. Kesoram Industries Ltd. & Ors. (supra) runs counter to view of Hon'ble 7 Judges Bench in India Cement Ltd. & Ors. v. State of Tamil Nadu & Ors. (supra). It then proceeds to examine whether interference in writ jurisdiction was warranted and notices that contract was a non-statutory one, the differential burden was deposited by the respondents, Clause 4.4 of the terms and conditions obliged the petitioners to shoulder the same and its Clause 11.12 provided an arbitration. It found that if Larger Bench of Hon'ble Apex Court finds that these components constitute "tax" and cannot be recognized as part of the "transaction value", remedies for refund under Section 11B of the Excise Act needed ....
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....inion that royalty is a tax, and as such a cess on royalty being a tax on royalty, is beyond the competence of the State Legislature because Section 9 of the Central Act covers the field and the State Legislature is denuded of its competence under Entry 23 of List II. In any event, we are of the opinion that cess on royalty cannot be sustained under Entry 49 of List II as being a tax on land. Royalty on mineral rights is not a tax on land but a payment for the user of land." Thereafter, in next paragraph, i.e., Paragraph No. 57, the Hon'ble Apex Court (Five Judges) point out that vide Paras 22 and 31, which precede Para 34 (reproduced above), the Hon'ble 7 Judges Bench has held that "royalty" is not a tax. The Hon'ble Five Judges Bench records - "57. In the first sentence the word "royalty" occurring in the expression "royalty is a tax", is clearly an error. What the majority wished to say, and has in fact said, is "cess on royalty is a tax". The correct words to be printed in the judgment should have been "cess on royalty" in place of "royalty" only. The words "cess on" appear to have been inadvertently or erroneously omitted while typing the text of the judgment". 17.&ems....
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....Excise duty? Whether such payment binds these petitioners? If not, Whether petitioners independent of pending reference before the Nine Judges of the Hon'ble Apex Court, can still oppose its recovery from them? are neither raised nor argued before us. The only effort of the petitioners has been to demonstrate that pendency of that reference has no bearing and till its adjudication, the law in force needs to be enforced. This effort is apparently misconceived and they cannot succeed with such an argument, in present facts. Moreover, this contention and the plea that they cannot now recover this differential Excise duty from their purchasers or consumers, at the most indicate breach of a contractual term which in present facts, is amenable to arbitration. The understanding of a legal provision and position by the WCL, its notice dated 22/25-3-2011 in this regard, its impact in law on civil rights of parties and claims (if any) arising therefrom, are all the disputes arising under the non-statutory contract and forum of arbitration is accepted therefor by the petitioners. It cannot be said that reliefs sought in these writ petitions do not emanate from the contract between the parties....