Bombay High Court
M/S Siemens Ltd A Registered ... vs The Union Of India And Another on 3 October, 2023
Bench: Mangesh S. Patil, Shailesh P. Brahme
2023:BHC-AUG:21385-DB
40 WP.6757.22+.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO.6757 OF 2022
M/s. Siemens Ltd.
A Registered Company having its
factory at Plot No.E-76, MIDC,
Waluj, Aurangabad, through its
Authorised Mr. Babasaheb Salunke ... PETITIONER
VERSUS
1. The Union of India
through the Revenue Secretary,
Department of Revenue, Ministry of
Finance having his office at 128-
A/North Block, New Delhi
2. The Assistant Commissioner of Goods
and Service Tax, Aurangabad Rural
Division, having his office at N-5, Town
Centre, CIDCO, Aurangabad DN-II -
431030 ... RESPONDENTS
WITH
WRIT PETITION NO.6760 OF 2022
M/s. Siemens Ltd.
A Registered Company having its
factory at Plot No.E-76, MIDC,
Waluj, Aurangabad, through its
Authorised Mr. Babasaheb Salunke ... PETITIONER
VERSUS
1. The Union of India
through the Revenue Secretary,
Department of Revenue, Ministry of
Finance having his office at 128-
A/North Block, New Delhi
2. The Assistant Commissioner of Goods
and Service Tax, Aurangabad Rural
Division, having his office at N-5, Town
Centre, CIDCO, Aurangabad DN-II -
431030 ... RESPONDENTS
1/8
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40 WP.6757.22+.odt
WITH
WRIT PETITION NO.6761 OF 2022
M/s. Siemens Ltd.
A Registered Company having its
factory at Plot No.E-76, MIDC,
Waluj, Aurangabad, through its
Authorised Mr. Babasaheb Salunke ... PETITIONER
VERSUS
1. The Union of India
through the Revenue Secretary,
Department of Revenue, Ministry of
Finance having his office at 128-
A/North Block, New Delhi
2. The Assistant Commissioner of Goods
and Service Tax, Aurangabad Rural
Division, having his office at N-5, Town
Centre, CIDCO, Aurangabad DN-II -
431030 ... RESPONDENTS
WITH
WRIT PETITION NO.6762 OF 2022
M/s. Siemens Ltd.
A Registered Company having its
factory at Plot No.E-76, MIDC,
Waluj, Aurangabad, through its
Authorised Mr. Babasaheb Salunke ... PETITIONER
VERSUS
1. The Union of India
through the Revenue Secretary,
Department of Revenue, Ministry of
Finance having his office at 128-
A/North Block, New Delhi
2. The Assistant Commissioner of Goods
and Service Tax, Aurangabad Rural
Division, having his office at N-5, Town
Centre, CIDCO, Aurangabad DN-II -
431030 ... RESPONDENTS
2/8
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40 WP.6757.22+.odt
WITH
WRIT PETITION NO.6793 OF 2022
M/s. Siemens Ltd.
A Registered Company having its
factory at Plot No.E-76, MIDC,
Waluj, Aurangabad, through its
Authorised Mr. Babasaheb Salunke ... PETITIONER
VERSUS
1. The Union of India
through the Revenue Secretary,
Department of Revenue, Ministry of
Finance having his office at 128-
A/North Block, New Delhi
2. The Assistant Commissioner of Goods
and Service Tax, Aurangabad Rural
Division, having his office at N-5, Town
Centre, CIDCO, Aurangabad DN-II -
431030 ... RESPONDENTS
...
Advocate for petitioner : Mr. Rahul Thakur h/f Mr. Palod Lalitkumar
Advocate for Respondent Nos.1 and 2 : Mr. D.S. Ladda
...
CORAM : MANGESH S. PATIL AND
SHAILESH P. BRAHME, JJ.
Reserved on : 25.09.2023
Pronounced on : 03.10.2023
JUDGMENT :
Heard both the sides. Rule. Rule is made returnable
forthwith. At the joint request of the parties, the matters are heard
finally at the stage of admission.
2. Since a common issue arises in all these petitions filed by the
same public limited company regarding powers of the Revenue
Department to resume inquiry into the show cause cum demand notices
issued in the matters of proposed reversal under Rule 14 of the Cenvat
Credit Rules, 2004 read with Section 11A of the Central Excise Act, 1944,
40 WP.6757.22+.odt
after lapse of more than 10 years, we are disposing of these writ petitions
by this common order to avoid rigmarole.
3. The petitioner company is having a central excise
registration having been engaged in manufacturing excisable goods. The
excise returns filed by it for the period July 2010 to June 2011 were
audited by respondent No.2 which is the Assistant Commissioner of
Goods and Service Tax, Aurangabad. He found that the petitioner was
not entitled to the Cenvat Credit which it had availed of. It was served
with separate show cause notices which were responded to by the
petitioner. The information can be collated as under :
Sr. Matter Show cause Replied on Second Personal
No. notice date notice date hearing
notice
1. WP No.6757/2022 11.07.2011 04.08.2011 06.01.2022
2. WP No.6761/2022 07.09.2009 09.11.2009 06.01.2022
3. WP No.6760/2022 18.12.2008 13.04.2009 14.01.2022
4. WP No.6762/2022 07.09.2009 09.11.2009 19.01.2022
5. WP No.6793/2022 26.07.2010 09.08.2010 06.01.2022
and
19.01.2022
and
02.02.2022
4. The petitioner is aggrieved by these communications,
whereby, the respondent No.2 has now resumed the inquiries.
5. The learned advocate for the petitioner by referring to catena
of judgments, to which we shall advert a little later, would submit that
the inquiries have been sought to be resumed after lapse of inordinate
40 WP.6757.22+.odt
delay of 10 to 13 years. The respondent No.2 was bound to take decision
pursuant to the show cause notices issued and the reply filed within a
reasonable time as provided in Section 11A (11). He would submit that
due to inordinate and unexplained delay in adjudicating the matters after
issuance of show cause notices which were promptly replied, the
respondent No.2 is not entitled to resume the inquiries. Petitioner cannot
be kept under the hanging sword for years together and a mandamus be
issued directing the respondents to drop the proceeding.
6. The learned advocate would rely upon the following
decisions :
i. Raymond Ltd. Vs. The Union of India ; 2019-VIL-405-BOM-CE
ii. Parle International Ltd. Vs. Union of India and others;
2020-VIL-592-BOM-CE
iii. Sushitex Exports (India) Ltd. & Ors. Vs. The Union of India & Ors.;
2022-VIL-55-BOM-CU
iv. The Bombay Dyeing and Manufacturing Company Ltd. Vs. Deputy
Commissioner of CGST & CX ; W.P. No.2874 of 2022, order dated
14.02.2022
v. Reliance Transport and Travel Pvt. Ltd. Vs. The Union of India ;
2022-VIL-238-BOM-ST
vi. ATA Freight Line (I) Pvt. Ltd. Vs. Union of India;
2022-VIL-244-BOM-ST
vii Conventry Estates Pvt. Ltd. Vs. The Joint Commissioner CGST and
Central Excise & Anr.; W.P. No.4082/2022 vide order dated
25.07.2023
7. The learned advocate Mr. Ladda for the respondents
referring to the affidavit-in-reply would submit that there is no dispute
40 WP.6757.22+.odt
about the fact that the petitioner company was served with the show
cause notices for reversal of the Cenvat Credit availed by it to which it
was not entitled to. He also submits that even the petitioner had
promptly responded to the show cause notices but submits that there
were peculiar reasons why the inquiries were held up. He would point
out that the petitioner company had availed the Cenvat Credit to which it
was not entitled to. The department had filed an appeal before the
Supreme Court in the matter of availment of inadmissible credit in terms
of Rule 2(1) of the Cenvat Credit Rules, 2004. As per the office
procedure of the Department of Administrative Reforms and Public
Grievances the petitioner's cases were transferred to the Call Book
maintained by the department as at the relevant time no action to
expedite its disposal was possible. It was pursuant to the orders of the
Range Commissioner Excise that the cases were kept pending. The
appeal was however withdrawn by the department on account of low tax
effect in terms of the CBEC's instructions dated 11.07.2018. Accordingly
the Supreme Court dismissed the Special Leave to Appeal on 06.02.2019.
Subsequently the pending call book cases have been revived in the light
of provisions of Section 11A (8) to 11 A (11) of the Central Excise Act
and the period for the alleged delay should only be counted from
06.02.2019 when the matter before the Supreme Court was disposed of.
Since there was pandemic thereafter, some time was lost. There is no
intentional or deliberate attempt to protract the inquiries. The petitioner
40 WP.6757.22+.odt
is a public limited company and cannot be allowed to take such technical
defence.
8. We have carefully considered the rival submissions and
perused the papers. As far as the facts are concerned regarding issuance
of the show cause notices and the petitioner's replies to those, there is no
dispute. Since the proposed action regarding reversal was contemplated,
the provisions of Section 11A of the Central Excise Act, 1944 are sought
to be invoked for raising the demand and recovery. The provision of
Section 11A inter alia provides for a period of limitation within which the
notices are supposed to be issued to make the recoveries and provides
that the action of recovery has to be initiated within six months/2 years
from the date of notice depending upon the facts whether it is a case
falling under Sub-Section 1 or Sub-Section 2 respectively. It is, therefore,
abundantly clear that contrary to this statutory time limit, the
respondents have now revived the inquiries after more than a decade and
the action would apparently be illegal. Precisely in similar set of fact, in
the aforementioned matters, coordinate benches of this Court have from
time to time struck down similar actions revived belatedly.
9. Though the respondents are now coming with a stand about
the petitioner's show cause notices having been kept in the Call Book in
the light of the CBEC's circular, the conspicuous absence in the reply
about the petitioner having ever been informed about it in view of the
pendency of the appeal before the Supreme Court clearly demonstrates
40 WP.6757.22+.odt
that the explanation for the delay is coming forth as an after thought. It
was imperative for the respondents if they were intending to keep the
show cause notices in abeyance, to have informed the petitioner about it.
This is what has been emphasised by this Court in the matters of
Raymond Ltd. and Parle International Ltd (supra).
10. Even in respect of similar proceedings under the service tax
matters under Section 73 of the Finance Act, coordinate benches of this
Court in the matters of Reliance Transport and Travel Pvt. Ltd., ATA
Freight Line (I) Pvt. Ltd. and Coventry Estate Pvt. Ltd. (supra), the
actions initiated after prolonged period have been struck down.
11. In our considered view, the impugned actions are clearly
iniquitous and arbitrary. In view of the consistent observation of this
Court in catena of judgments (supra), the impugned actions of reviving
the inquiries which were in cold storage for more than a decade are
clearly contrary to the law and is liable to be struck down.
12. The writ petitions are allowed.
13. The Rule is made absolute in all these petitions in terms of
prayer clauses 'B'.
(SHAILESH P. BRAHME, J.) (MANGESH S. PATIL, J.)
habeeb
