Page No.# 1/16 vs The North Eastern Coalfields Limited ...
2024 Latest Caselaw 8060 Gua

Gauhati High Court

Page No.# 1/16 vs The North Eastern Coalfields Limited ... on 5 November, 2024

Author: Devashis Baruah

Bench: Devashis Baruah

                                                               Page No.# 1/16

GAHC010005822014




                      THE GAUHATI HIGH COURT
  (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

                        Case No. : WP(C)/674/2014

         MAHALAXMI ASSOCIATES PVT. LTD. and 2 ORS
         A COMPANY HAVING ITS REGISTERED OFFICE AT N.H. 37, BELTALA,
         GUWAHATI, AND IS REP. BY ONE OF ITS DIRECTOR SRI NAVEEN KUMAR
         GUPTA.

         2: MAHALAXMI CONTINENTAL LTD.
         A COMPANY HAVING ITS REGISTERED OFFICE AT N.H. 37
          BELTALA
          GUWAHATI
         AND IS REP. BY ONE OF ITS DIRECTOR SRI NAVEEN KUMAR GUPTA.

         3: M/S MAA KAMAKHYA COKE INDUSTRIES
         A PARTNERSHIP FIRM
          HAVING ONE OF ITS OFFICE AT IIT COLLEGE ROAD
         AMINGAON
          GUWAHATI AND IS REP. BY ONE OF ITS PARTNER SRI NAVEEN KUMAR
         GUPTA

         VERSUS

         THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS.
         THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR, NORTH EASTERN
         COALFIELDS LTD., CHRISTIAN BASTI, G.S. ROAD, GUWAHATI, DIST.-
         KAMRUP M, ASSAM.

         2:THE GENERAL MANAGER S and M
          NORTH EASTERN COALFIELDS LTD.
         TINSUKIA
         ASSAM.

         3:COAL INDIA LTD.
          NETAJI SUBHASH ROAD
         KOLKATA
         THROUGH ITS CHAIRMAN.
                                                                           Page No.# 2/16


            4:CHIEF GENERAL MANAGER
             NORTH EASTERN COALFIELDS
             MARGHERITA
            ASSAM- 786181.

            5:THE UNION OF INDIA

             REP. BY ITS SECRETARY
             MINISTRY OF FINANCE
             NEW DELHI

Advocate for the Petitioner   : MS.B GOGOI, MR.A J HAZARIKA,MRS.B GOYAL

Advocate for the Respondent : MR.A M DUTTA, MR. C.K.S. BARUAH, SC, C.G.C.,SC, COAL
INDIA ,MR.M Z AHMED




             Linked Case : WP(C)/6151/2013

            VIRTIGO IMPEX PVT. LTD.
            A COMPANY REGD. UNDER THE COMPANIES ACT
            1956 AND HAVING ITS REGD. OFFICE AT PUNJABI BAGH
            NEW DELHI
            IS REPRESENTED BY AUTHORISED REPRESENTATIVE R.K. BANSAL


             VERSUS

            THE NORTH EASTERN COALFIELDS LMITED and 3 ORS
            THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR
            NORTH EASTERN COALFIELDS LTD.
            NORTH EASTERN COALFIELDS LTD.
            CHRISTIAN BASTI
            G.S. ROAD
            GUWAHATI
            DIST- KAMRUP METRO
            ASSAM

            2:THE GENERAL MANAGER SandM
            NORTH EASTERN COALFIELDS LTD.
            TINSUKIA
            ASSAM
                                                         Page No.# 3/16

3:COAL INDIA LTD
NETAJI SUBHASH ROAD
KOLKATA
THROUGH ITS CHAIRMAN

4:CHIEF GENERAL MANAGER
NORTH EASTERN COALFIELDS
MARGHERITA
ASSAM
PIN-786181
------------

Advocate for : MSQ DUTTA Advocate for : SC COAL INDIA appearing for THE NORTH EASTERN COALFIELDS LMITED and 3 ORS

Linked Case : WP(C)/6129/2013

ANMOL INDIA LTD.

A COMPANY REGD. UNDER THE COMPANIES ACT 1956 AND HAVING ITS REGD. OFICE AT BASISTHAPUR GHY.

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST- KAMRUP METRO ASSAM

2:THE GENERAL MANAGER SandM

NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN Page No.# 4/16

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM PIN-786181

------------

Advocate for : MR.M K CHOUDHURY Advocate for : appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS

Linked Case : WP(C)/7062/2013

ANANT INDUSTRIAL SALES CORPORATION A PROPRIETORAL FIRM HAVING ITS REGD. OFFICE AT SECTOR-4 BLOCK -B RAILWAY MAAL GODOWN ROAD MANDI GOVINDGARH PUNJAB AND IS REPRESENTED BY ITS PROPRIETOR SRI BHARTHARI PRASHAR

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS. THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST- KAMRUP METRO ASSAM

2:THE GENERAL MANAGER SandM NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM PIN-786181 Page No.# 5/16

------------

Advocate for : MR.A J HAZARIKA Advocate for : MR.M Z AHMED appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS.

Linked Case : WP(C)/6154/2013

BHEL COAL FUEL PVT. LTD.

HAVING ITS REGISTERED OFFICE AT TULSI NAGAR HOSHIARPUR PUNJAB AND IS REPRESENTED BY ITS AUTHORIZED REPRESENTATIVE SRI NARESH KUMAR.

VERSUS

THE NORTH EASTERN COALFILEDS LIMITED and 3 ORS THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G S ROAD GHY DIST. KAMRUP M ASSAM.

2:THE GENERAL MANAGER SandM NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM.

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN.

4:CHIEF GENERAL MANAGER

NORTH EASTERN COALFIELDS MARGHERITA ASSAM. PIN- 786181.

------------

Advocate for : MSQ DUTTA Advocate for : appearing for THE NORTH EASTERN COALFILEDS LIMITED and 3 ORS

Linked Case : WP(C)/6148/2013 Page No.# 6/16

KALYANI INDIA PVT. LTD.

HAVING ITS REGISTERED OFFICE AT RAILWAY MALL GODOWN ROAD P.O.- MANDI GOBINDGARH FATEHGARH SAHIB PUNJAB AND IS REP. BY ITS DIRECTOR SRI NARESH KUMAR.

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST.- KAMRUP M ASSAM.

2:THE GENERAL MANAGER S and M NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM.

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN.

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM- 786181.

------------

Advocate for : MS.B GOGOI Advocate for : SC COAL INDIA appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS

Linked Case : WP(C)/6155/2013

M/S SHRI SHIV SHAKTI COAL TRADERS A PROPRIETORAL FIRM HAVING ONE OF ITS OFFICE AT N.H. 37 BELTOLA Page No.# 7/16

GUWAHATI AND IS REPRESENTED BY ITS AUTHORIZED REPRESENTATIVE SRI SUDHIR KUMAR MANDAL

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST- KAMRUP ASSAM

2:THE GENERAL MANAGER SandM NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM

3:COAL INDIA LTD NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM PIN-786181

------------

Advocate for : MSQ DUTTA Advocate for : MR.M Z AHMED appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS

Linked Case : WP(C)/6150/2013

M/S PANKAJ COAL ENTERPRISES HAVING ITS OFFICE AT R.K. MISSION ROAD TINSUKIA AND IS REP. BY ITS AUTHORIZED REPRESENTATIVE SRI AJAY CHETRI.

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 2 ORS Page No.# 8/16

THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST.- KAMRUP M ASSAM.

2:THE GENERAL MANAGER S and M NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM.

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN.

4:CHEIF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM- 786181.

------------

Advocate for : MS.B GOGOI Advocate for : appearing for THE NORTH EASTERN COALFIELDS LIMITED and 2 ORS

Linked Case : WP(C)/6443/2013

M/S SOOD COAL TRADERS and 3 ORS. A PROPRIETORAL FIRM HAVING ITS OFFICE AMONGST OTHERS AT GURUDWARA ROAD TOWNSHIP RAJPURA PUNJAB

2: M/S PUNJAB COAL SALES A PROPRIETORAL FIRM HAVING ITS OFFICE AMONST OTHERS AT GURUDWARA ROAD TOWNSHIP RAJPURA PUNJAB

3: M/S HARI KRISHAN and SONS A PROPRIETORAL FIRM HAVING ITS OFFICE AMONST OTHERS AT GURUDWARA ROAD Page No.# 9/16

TOWNSHIP RAJPURA PUNJAB

4: M/S VINOD COAL TRADERS A PROPRIETORAL FIRM HAVING ITS OFFICE AMONST OTHERS AT GURUDWARA ROAD TOWNSHIP RAJPURA PUNJAB ALL THE PETITIONERS ARE REPRESENTED BY THEIR AUTHORIZED REPRESENTATIVE SRI SANJEEV KUMAR SOOD VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS. THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. RAOD GUWAHATI DIST- KAMRUP METRO ASSAM

2:THE GENERAL MANAGER SandM NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERIATA ASSAM PIN-786181

------------

Advocate for : MSQ DUTTA Advocate for : SC COAL INDIA appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS.

Linked Case : WP(C)/6147/2013

M.K. SHAH EXPORTS LTD Page No.# 10/16

A COMPANY REGD. UNDER THE COMPANIES ACT

HAVING ITS REGD. OFFICE AT M.K. HOUSE 2/2 JUSTICE DWARKANATH ROAD KOLKATA AND IS REPRESENTED BY ITS AUTHORIZED SIGNATORY SRI SANJIT CHALIHA

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS THROUGH ITS CHAIRMAN CUM MANAGING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST- KAMRUP ASSAM

2:THE GENERAL MANAGER Sand M NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM PIN-786181

------------

Advocate for : MR.A J HAZARIKA Advocate for : SC COAL INDIA appearing for THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS

Linked Case : WP(C)/639/2014

M/S BANUR CEMENT STORE A PROPRIETORAL FIRM HAVING ITS OFFICE AT FAUJI COLONY BANUR TEHSIL - RAJPURA Page No.# 11/16

PATIALA PUNJAB AND IS REP. BY ITS AUTHORIZED REPRESENTATIVE SRI NAVEEN MITTAL.

VERSUS

THE NORTH EASTERN COALFIELDS LIMITED and 3 ORS. THROUGH ITS CHAIRMAN CUM MANAING DIRECTOR NORTH EASTERN COALFIELDS LTD. CHRISTIAN BASTI G.S. ROAD GUWAHATI DIST.- KAMRUP M ASSAM.

2:THE GENERAL MANAGER S andM NORTH EASTERN COALFIELDS LTD. TINSUKIA ASSAM.

3:COAL INDIA LTD.

NETAJI SUBHASH ROAD KOLKATA THROUGH ITS CHAIRMAN.

4:CHIEF GENERAL MANAGER NORTH EASTERN COALFIELDS MARGHERITA ASSAM- 786181.

------------

Advocates for the petitioners: Ms. BS Goyal Mr. AJ Hazarika MSQ Dutta Ms. B Gogoi Ms. B Chauhan

Advocates for the respondents : Mr. MZ Ahmed Senior Advocate Page No.# 12/16

Mr. AM Dutta Ms. B Dutta Mr. CKS Baruah Central Govt. Counsel

BEFORE HONOURABLE MR. JUSTICE DEVASHIS BARUAH

Date : 05-11-2024

JUDGMENT & ORDER(ORAL)

Heard Ms. B S Goyal, the learned counsel appearing on behalf of the writ petitioners in the batch of writ petitions. Also heard Mr. MZ Ahmed, the learned senior counsel assisted by Mr. AM Dutta, the learned counsel appearing on behalf of the Coal India Ltd., (for short, the CIL) as well as Mr. CKS Baruah, the learned Central Government Counsel appearing on behalf of the Union of India.

2. The present batch of writ petitions have been filed assailing the actions on the part of the respondent CIL in issuance of respective debit notes and thereby demanding the petitioners in the batch of writ petitions to pay amounts on account of arrears of central excise duty and corresponding VAT/CST from 01.03.2011 to 28.02.2013 against the coal purchase from the CIL by the petitioners during the said period.

3. The case of the petitioners herein is that the petitioners in terms with the Spot E-Auction Scheme 2007 had purchased coal by making due payment of the bid price, statutory levies, surface transport charges, sizing/beneficent charges, Page No.# 13/16

taxes, cess, royalty etc., at the time of delivery of the coal during the period from 01.03.2011 to 28.02.2013. However, some time in the month of April 2013 onwards, the petitioners in the batch of writ petitions were issued debit notes respectively asking the petitioners to make payments on account of the arrear of central excise duty and corresponding VAT/CST for the period from 01.03.2011 to 28.02.2013.

4. Ms. BS Goyal, the learned counsel appearing on behalf of the petitioners submitted that the said demand so sought to be made is without any basis and vague material particulars had been arbitrarily imposed upon the petitioners. She further submits upon perusal of the debit notes as well as the enclosures thereto would show that the respondent CIL at their whims and fancies made those calculations in respect to the period of sales. The learned counsel submitted that by issuance of the debit notes, the respondent CIL are trying to make recovery through other extra judicial means. Elaborating, the learned counsel submitted that the petitioners, who are in the business of purchase from the respondent CIL and thereafter selling it is trying to appropriate their demands through appropriation from other transactions.

5. On the other hand, Mr. MZ Ahmed, the learned senior counsel appearing on behalf of the CIL submitted that the CIL came within the purview of the Central Excise Act, 1944 (for short, 'the Act of 1944') w.e.f. 01.03.2011. Earlier to that, there was no central excise duty on coal. He further submitted that at the time of filing of the returns under the Act of 1944, the Central Excise Department did not agree to the interpretation of the CIL that the royalty and stowing excise duty would not come within the purview of the transaction value and, as such, Page No.# 14/16

imposed the additional amount upon the CIL in view of the increase in the transaction value on account of inclusion of the stowing excise duty as well as the royalty. This increase in the central excise duty which the CIL had to pay is sought to be recovered by way of issuance of these debit notes.

6. This Court had duly heard the learned counsels appearing on behalf of the parties and have given an anxious consideration to the submissions made.

7. The petitioners in the instant batch of writ petitions have assailed the actions of the respondent CIL on the ground that they have resorted to an illegal and arbitrary means to recover certain amounts not only without providing details, but also by appropriating from other transactions carried out between the CIL and the petitioners. Be that as it may, one aspect is very clear that the petitioners herein have not assailed as to whether the stowing excise duty as well as the royalty would form a part of the transaction value on which the central excise duty is liable to be paid. Under such circumstances, what transpires from the materials on record, as well as the submissions so made by the learned counsels appearing on behalf of the parties is that the CIL is trying to recover certain amounts from the petitioners by issuance of these debit notes along with the enclosures. It further appears from the enclosures to the debit notes issued to the petitioners that the same are vague and lacks material particulars as regards how the said demanded amount is arrived at against the various transactions carried out during the period from 01.03.2011 to 28.02.2013.

Page No.# 15/16

8. Be that as it may, it is relevant to take note of the submissions of the learned counsel for the petitioners wherein it was emphasized that basing upon the debit notes and the enclosures, the respondent CIL is trying to recover from other transactions carried out by the petitioners with the CIL. This Court is of the opinion that the issuance of the debit notes along with the enclosures can at best be construed to be demands made by the CIL upon the petitioners. If such demands are rejected and the petitioners refuse to pay, the same would result in a dispute between the respondent CIL and the petitioners. Clause 11.12 of the Spot E-Auction Scheme 2007 categorically mandates that if disputes arise, the same is to be resolved by way of Arbitration as per the provisions of the Act of 1996. Additionally, nothing could be shown by the Senior Counsel appearing for the CIL that in respect to some other sale transactions, amounts can be appropriated or forfeited from some other transaction. In fact, Clause 11.11 of the Spot E-Auction Scheme 2007 would show that sale under each e-auctions shall be individual, independent, unique and complete transaction.

9. Accordingly, this Court is of the opinion that by issuance of a debit note, the CIL cannot recover such amounts from other transactions. However, in terms with Clause 11.12 of the Spot E-Auction Scheme 2007, it is the opinion of this Court that if the CIL wants to recover such amounts, the said amounts can be recovered by the process mandated in the said Scheme i.e. by way of Arbitration. Accordingly, the instant batch of writ petitions stand disposed of with the following observations and direction(s):

(i). The petitioners herein have not assailed as to whether the stowing excise duty as well as the royalty would form a part of the transaction value Page No.# 16/16

for levying central excise duty.

(ii). The debit notes which have been issued and the enclosures therewith would merely be demands made for realization of amounts. If the petitioners disputes the said demands, it would result in respective dispute, coming within the ambit of Clause 11.12 of the Spot E-Auction Scheme 2007, and, such disputes can be only resolved by way of Arbitration.

(iii). The CIL is given the liberty to initiate proceedings for recovery, if they wish to recover such amounts by following the due procedure i.e. by way of Arbitration in terms with Clause 11.12 of the Spot E-Auction Scheme 2007.

(iv). This Court had also taken note of that the demands so made vide impugned debit notes were sub-judice before this Court. Accordingly, the period from the date of filing of the writ petition by each of the petitioners till date be excluded while computing the period of limitation.

10. With the above, the instant batch of writ petitions stand disposed of.

JUDGE

Comparing Assistant