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Judgment
A.R. Tiwari, J.—These petitions, filed by the same petitioner, are being heard as connected matters and are being disposed of by this common order. Petitionwise facts are as under :-
(i) M.P. No. 434/87 : The petitioner has filed this petition on 10-4-1987 under Article 226/227 of the Constitution of India for the under-noted reliefs :-
(1) A writ, order or direction in the nature of certiorari be issued to the respondents quashing the show cause notice (Annexure P).
(2) That a writ mandamus or a writ order or direction in the nature of Mandamus be issued directing the respondent not to continue with the proceedings on the basis of show cause notice dated 2-3-1987 (Annexure P).
(2A) That a writ of mandamus or a writ order or direction in the nature of mandamus be issued directing the respondents to refund to the petitioners a sum of Rs. 21,15,725.36 as per details given in Annexure L.
(2B) That a writ of mandamus or a writ order or direction in the nature of mandamus be issued declaring that in the facts and circumstances of the present case, the Modvat amount has been rightly availed and no amount is refundable by the petitioner.
(3) That the costs of the present petition be awarded to the petitioner.
(4) Such other order, writ, or direction be issued as are considered appropriate by this Hon''ble Court in the situation of the case.
Reliefs vide Para 2A and 2B are incorporated later on 19-2-1988 on leave of the Court. The main relief as incorporated in the petition initially was about quashment of notice to show cause dated 2-3-1987, C .No .V(25)15-l/87/Adj/22353, issued by the Collector of Central Excise & Customs, Indore. It was stated in the notice that the petitioner has contravened the Provisions of Rules 57G, 57H, 173G, 173F read with Rule 57-1 and 173Q(bb) of the Central Excise Rules, 1944 and evaded Central Excise Duty amounting to Rs. 43,81,758.98, on the ground that the petitioner fraudulently availed of credit of duty under Modvat. By amendment, the petitioner has also sought direction for refund of the sum of Rs. 21,15,725.36 as detailed in Annexure L. The other reliefs are ancillary in nature. Respondents No. 1,3 and 4 have filed return with preliminary objections. One such objection is about availability of alternative remedy.
(ii) M.P. No. 620/87 : This petition is filed on 21st May, 1987 for the undernoted reliefs :-
(1) a writ, order or direction in the nature of certiorari be issued to the respondents quashing the order dated 12-5-1987 (Annexure N).
(2) that a writ mandamus or a writ order or direction in the nature of mandamus be issued directing the respondents not to demand the amount demanded in order dated 12-5-1987 (Annexure N).
(3) that the costs of the present petition be awarded to the petitioner.
(4) Such other order, writ or direction be issued as are considered appropriate by this Hon''ble Court in the situation of the case.
(5) No vires is involved in this petition.
By this petition, the petitioner has questioned the validity of the order dated ll/12th May, 1987 (Annexure N) demanding the payment of the amount of Rs. 5,69,148.14 representing the credit allegedly taken wrongly under Modvat scheme. Respondents Nos. 1 to 3 have filed reply with preliminary objections. One such objection is about existence of alternative remedy by way of appeal.
I have heard Shri S.N. Kohli, learned Counsel for the petitioner and Shri B.G. Neema learned Counsel for the respondents in both these petitions.
Counsel for the petitioner forcefully submitted that show cause notice (Annexure P) and order of demand (Annexure N) are without jurisdiction and as such the validity is required to be tested in these petitions. He placed reliance on (i) 1978 (2) E.L.T. (J 632), Universal Cables Ltd. v. Union of India and Ors; (ii) Hindustan Electro Graphites Ltd. Vs. Union of India (UOI), (iii) Jayant Vitamins Limited Vs. Union of India (UOI), (iv) 1996 (66) ECR 461 (M.P.) M.P. No. 779/89; Bajaj Tempo Ltd. v. Union of India; (v) M.P. No. 1817/91, Electro Chem v. Union of India (vi) Romesh Thappar Vs. The State of Madras, ; (vii) Kavalappara Kottarathil Kochunni Moopil Nayar Vs. The State of Madras and Others, ; (viii) Gopal Vinayak Godse Vs. The Union of India and Others, ; (ix) N.P. Mathur and Others Vs. State of Bihar and Others, ; (x) Dharamsi Morarji Chemical Co. Ltd. Vs. Union of India (UOI) and Another, (xi) Tata Export Ltd. Vs. Union of India (UOI) and Others, ; (xii) Tata Yodogawa Limited and Another Vs. Union of India(UOI) and Others, ; and (xiii) Galanda Continuous Casting Ltd. Vs. Assistant Collector, Central Excise, Hyderabad and Others, .
As regards M.P. No. 434/87, the Counsel also submitted that disputed amount was deposited subject to right and decision of appeal. The appeal was filed and was disposed of by the direction of remand. The Counsel submitted that after remand, fresh show cause notice is issued. This notice is challenged in this petition.
As regards another petition, the Counsel submitted that the petitioner was eligible and entitled to obtain Modvat credit and as such the order of demand (Annexure N) is also without jurisdiction, and thus deserves to be dislodged by appropriate writ.
Shri B.G. Neema, on the other hand, submitted that this Court has taken consistent view that such matters must be left to be decided by the proper authorities and appropriate forum. In State of U.P. and another Vs. Labh Chand, ; it is held as under :
"What a Statutory Forum or Tribunal is specially created by a statute for redressal of specified grievances of persons on certain matters, the High Court should not normally permit such persons to ventilate their specified grievances before it by entertaining petitions under Article 226 of the Constitution is a legal position which is too well settled."
I have considered the pleadings as also submissions. I find that facts are disputed and the petitions thus, involve adjudication of disputed question of facts. In my view, a writ Court is not proper forum to seek such adjudication. It is trite law that when more satisfactory solution is available on the terms of the statute itself then resort to Article 226 or 227 is impermissible in law as laid down in Shyam Kishore and others Vs. Municipal Corporation of Delhi and another, ; In State of Andhra Pradesh Vs. M/s. T.G. Lakshmaiah Setty and Sons, ; it is ruled that validity of orders of assessment, rendered under tax law, should be tested under relevant Act and in on other way.
The authorities empowered under various Acts, are expected to function properly and to show greater responsibility to avoid hardship where the same is avoidable. They are required, nay expected, to do the rational thing ever unwilling to explore other alternatives before electing to do it. Lord Keynes observed that "Men will do the rational thing but only after exploring all other alternatives." Preamble to the Constitution of India promises dignity and this then demands doing of rational thing imprimis. In my view, the day should be deemed as done when authorities could afford to search alternatives. Truth must be seen to triumph.
This Court in M.P. No. 2230/93; Grasim Industries Ltd. v. The Collector of Customs and Another; filed against show cause notice had declined on 27-1-1995 to examine merits and had left the petitioner free to contest the matter before the authorities. This order dated 27-1-1995 was upheld by the Letters Patent Bench and SLP was also dismissed by the Apex Court.
First petition is directed against show cause notice (Annexure P). The petitioner has thus opportunity to show cause and seek withdrawal of notice if it has good ground in oppugnation. No adverse order is passed. In 1977 MPWN (II) 141, Vishnu Sitaram Pandit v. Registrar, Co-operative Societies and Ors. it is held that:
"There is no adverse order as yet. The Petitioner was merely called upon to show cause why action be not taken against him. This Court does not find any reason to interfere. The petitioner could have shown cause to the authority so that no adverse order would be passed against him, provided he had good cause to show. If the action proposed to be taken or as apprehended by the petitioner to be taken against him would be illegal and contrary to law, the petitioner could have shown this cause to the Additional Registrar. Since no adverse order has yet been passed, the petitioner''s contentions are all within the domain of imagination. This is not a case for issuance of a writ."
The contention about absence of jurisdiction is different from the situation of illegal exercise of power under the relevant provision. Whether declarations to earn benefit are filed or not and, if filed, then on what date or dates; whether the credit is obtained from correct date or without entitlement and whether imposition of duty is valid or not are matters to be scrutinised on facts. But facts are disputed herein. The question of refund is also interlinked.
The second petition is filed against the order of demand (Annexure N). This rests on the linchpin whether or not the credit was obtained as per eligibility and entitlement. This also requires adjudication of facts. The appellate forum is the proper forum.
Law demands consistency and uniformity unless there are extraordinary circumstances to inhibit normal course indicated under the Act and to quell notices, demands and proceedings under extraordinary powers available to writ court. No such circumstances are shown to exist.
The objection raised by Shri Neema thus is permitted to prevail.
Accordingly, I dispose of these petitions with directions as under :-
(a) M.P. No. 434/87: The petition is disposed of with the direction that the petitioner shall have liberty to submit proper reply to notice, if not furnished so far or additional reply, if felt necessary within a period of 45 days from today wherein it can also take, if so advised, objections as to the jurisdiction for issuance of such notice or can show impermissibility on the fulcrum of order of remand and may seek proper disposal of the same from appropriate authority. The petitioner may resort to appropriate remedy as regards the question of alleged refund also, as particularised in Annexure L.
(b) M.P. No. 620/87: The petition is disposed of with the direction that the petitioner may file appeal or any other proceedings, as may be permissible under the law against the order of demand dated 11 /12-5-1987 (Annexure N) if not filed so far, within a period of 45 days from today. If such an appeal or proceeding, as the case may be, is filed within this permitted period as prayed, the same shall not be opposed or shall not fail on the ground of bar of limitation only and shall be decided on merits in conformity with law.
If such reply or additional reply is submitted or if such appeal or proceeding is resorted to, the points raised in these petitions, shall be treated as open and litigable. Similarly, the points averred in opposition by the respondents, shall also be taken as available to them for contest.
With the aforesaid directions, these petitions are disposed of but without any orders as to costs. The counsel-fee for each side, however, is fixed at Rs. 2,500/- in each petition, if certified.
Security cost, if any, shall be refunded to the petitioner in each case, after due verification.
Retain this order in M.P. No. 434/87 and place its copy in M.P. No. 620/87.