BPL Sanyo Utilities and Appliances Ltd. vs Commr. of C. Ex.

C. Shivappa, J.—Though the writ petition is listed for admission, after notice to the learned Additional Central Government Standing

Counsel appearing for the respondents and with the consent of both the parties, the matter is taken up for final hearing.

The petitioner is seeking for a direction to quash the order of respondent No. 2 (CEGAT), passed on the stay application dated 18-2-1998.

The petitioner had been engaged in the manufacture of washing machines and parts thereof at Bangalore, since April 1992. The Commissioner

of Central Excise, Bangalore, the respondent No. 1 herein, had issued a show * cause notice dated 4-1-1996, directing the petitioner to show

cause as to why the clearance of spare parts like sub-assemblies in washing machines should not be treated as clearance of complete washing

machines in terms of interpretative Rule 2(a) of the Rules for interpretation of the schedule to the Central Excise Tariff Act and as to why the

various rates applicable to the washing machines should not be denied for payment of duty etc., the matter was finally adjudicated by the

Commissioner, by an order dated 29-4-1997, wherein it was held that the petitioner is liable to pay the differential Central Excise Duty of Rs.

1,10,50,630/- plus penalty of Rs. 25 lakhs and a redemption fine of Rs. 30 lakhs.

On appeal, the petitioner had filed an application u/s 35F of the Central Excise Act and that application was rejected by the Appellate Tribunal,

holding that there is no merit, and waived the penalty and fine and directed the petitioner to deposit the duty amount of Rs. 1,10,50,630/-.

The learned Senior Counsel for the petitioner Mr. C. Natarajan, inter alia, contended that the respondent No. 2 had not even looked into the

fact that the demand was barred by limitation as per proviso to Section 11A of the Act and that there was Notification No. 217/86 , dated 2-4-

1986, which provided an exemption for inter-factory movement, so that the deemed manufacture at Bangalore and its clearance is exempted, the

moment the goods were transported for de facto manufacture. He further contended that the authority had not considered the undue hardship.

The impugned order being a discretionary order, a reference is made to the financial position of the petitioner, in such a situation, it cannot be

said that there is non-consideration.

However, the learned Senior Counsel seeks for an early disposal of the appeal and has no objection to deposit 50% of the duty amount only.

Hence, the petitioner is directed to deposit 50% of the duty amount, viz., 50% of Rs. 1,10,50,630/- within a period of four weeks from today and

on deposit of such amount, the respondent No. 2 to register an appeal and to dispose of the same within a period of three months from the date of

entertaining such an appeal.

The writ petition is ordered accordingly. However, there will be no order as to costs. Consequently, the connected miscellaneous petition is

closed.