V.K. Industrial Corporation Ltd. vs Union of India (UOI)

Heard learned Counsel for the rival parties Perused petition.

This petition is filed under Article 226 of the Constitution of India by the Petitioner to seek refund of amount in the sum of Rs. 2,45,02,687/- as ordered by the Settlement Commission vide its order dated 25th February, 2010. The Petitioner was required to approach this Court since said order passed by the Settlement Commission has not been acted upon by the Revenue.

Mr. Jetly, learned Counsel appearing for the Revenue submits that the Revenue has moved the Settlement Commission for rectification of the order. On being asked, we were shown a written request made to the Settlement Commission, Customs and Central Excise, Mumbai to rectify alleged mistake and the reminders issued in this behalf from time to time. Having seen the rectification request in the form of correspondence, we are surprised to see the procedure adopted by the Revenue in this behalf to seek rectification. The rectification is sought by writing a letter to the Settlement Commission as if it is one of the departments of the Central Excise Commissionerate or the department of Revenue, forgetting that it is a statutory adjudicatory body established to bring about settlement of disputes bestowed with judicial powers. The practice of entering into correspondence with the Commission is unknown to law. We have our own doubts whether the Revenue is seriously trying to get the order rectified by adopting this unpalatable process. It is nothing but delaying tactics to avoid compliance of the order of the Settlement Commission.

Mr. Jetly prayed for fifteen days time to seek appropriate orders from the Settlement Commission. The request made is not bona fide. It cannot be granted in view of the fact that as yet no notice of rectification prayer has been issued to the Petitioner. The Settlement Commission is bound to take its own time, if at all the rectification application in the form of correspondence is to be entertained by the Commission. The Petitioner cannot be asked to wait for unusually long period to get the amount of refund as ordered by the Settlement Commission vide its order dated 25th February, 2010. Considering the fact that the refund amount has not been paid for more than eight months and that it does not carry any interest, in the event of failure on the part of Revenue to pay the refund amount to the Petitioner well within reasonable time, the grant of request for adjournment would cause substantial prejudice to the Petitioner which cannot be compensated in terms of money.

In the aforesaid view of the matter, in order to do justice between the parties and to avoid prejudice to either of the parties, we direct the Revenue to deposit the amount of Rs. 2,45,02,687/- with this Court, so as to enable this Court to make interest bearing investment with any nationalised bank. Amount to be deposited within three weeks from today, failing which amount of refund shall, thereafter, carry interest at the rate of 10% per annum till deposit with this Court is made.

Stand over for four weeks.