Kirloskar Pneumatic Company Limited vs Union of India

By this Writ Petition under Article 226 of the Constitution of India, the petitioners are seeking the following relief:-

"that this Court be pleased to issue a Writ of Mandamus or a writ in the nature of Mandamus or any other writ, order or direction under Article 226 of the Constitution of India, ordering and directing the Respondents to (i) forthwith permit the Petitioner to correct the registration number (ECC) in GAR-7 Challan No. 00115 dated 4 January, 2011 from AAACK2479CXM002 to AAACK2479CXM003; (ii) treat payment of Rs. 81,60,000.00 deposited vide GAR-7 Challan No. 00115 dated 4 January, 2011 as duty payable by the Saswad factory for the goods cleared in the month of December 2010; and (iii) not to insist on payment of Rs. 81,60,000.00 once again with or without interest."

Ordinarily, we would have thought that parties like the petitioners should not be compelled to approach this Court for a request which is innocuous and in the facts of this case as it can be. The petitioners are engaged, inter alia, in the manufacture of excisable goods of the First Schedule to the Central Excise Tariff Act, 1985 and for their factories, inter alia, at Hadapsar Industrial Estate, Saswad Pune Road, Saswad, District Pune and at Nashik namely Eklahare Road, Deolali and Panchak, Nashik.

These factories are registered under Section 6 of the Central Excise Act and Rule 9 of the Rules. The registration numbers are also set out at para-6. The petitioners have pointed out that they have approached the authorities for the purposes of taking credit and erroneously and inadvertently they mentioned the registration number of the Hadapsar factory. The monthly returns were also filed and as is clear from para-10 to 12 of the petition. The petitioner points out that the goods have been cleared and the duty payable has been paid in full. However, they were required to approach the authorities for the purposes of making a correction and which is contained in the letter of the petitioners at Annexure-E. This letter had to be addressed because it was brought to the notice of the petitioners that though they claim to have paid the amounts in cash and taken as credit in personal ledger account and utilized for payment of central excise duty for the month of December 2010, the Challan papers appear to be in respect of Hadapsar unit/factory of the petitioner. This fact was brought to the notice of the petitioners by the official of the department namely Superintendent of Central Excise, Jejuri Range, who has jurisdiction over the Saswad factory. It is in these circumstances, that the petitioners addressed a letter dated 26th April, 2013 and what the petitioners have been informed is that there is no provision whereby any such corrections can be made. They would have to deposit the amount under the correct assessee code and apply for refund of the amount deposited under the wrong assessee code. Thus, on account of this inadvertent error the petitioners were called upon to apply for refund of the deposit made under the wrong code. The petitioners point out that there is no reason for refusing such a request because the matter does not require any adjudication or a decision. It is only a correction and which could have been permitted in the given facts and circumstances and without creating a precedent if that was the apprehension.

When this matter was placed before us, we called upon Shri Bhate appearing for the respondents to take instructions and make a statement whether the respondents are willing to make the corrections and by not calling upon the petitioners to pay duty and seek a refund. However, Mr. Bhate states that the Commissioner is of the view that there is no such power vested in him. In the absence of any legal provision, such a request cannot be granted. To our mind, the refusal to correct the assessee''s code and to insist on payment of Rs. 18,60,000/- and thereafter seek a refund of the same, is ex facie erroneous and untenable. There is absolutely no justification for calling upon the petitioners to pay the sum and which they otherwise are entitled to take credit of. In these circumstances and in the facts peculiar to the petitioners, so also without creating any precedent for future cases, we allow this Writ Petition. Rule is made absolute in terms of prayer clause (a). The corrections be made within a period of four weeks from the date of receipt of copy of this order.