K.KARUNAKARAN Vs. ASSISTANT EXCISE COMMISSIONER

JUDGEMENT

(1.) The petitioners were licencees of an FL-1 shop No.34/99-2000 of Chathannoor Range. The said shop was auctioned in favour of the petitioners for an annual rental of Rs.61,61,611/- (Rupees Sixty one lakh sixty one thousand six hundred and eleven only). It is not in dispute that the petitioners deposited an amount of Rs.18,48,483/- (Rupees Eighteen lakh forty eight thousand four hundred and eighty three only) towards security deposit, and also stood as sureties and executed solvency towards guarantee. While the petitioners started functioning the FL-1 shop with effect from 01/04/1999, in October 1999, they were issued with a notice informing them that an amount of Rs.6,71,614/- (Rupees Six lakhs seventy one thousand six hundred and fourteen only) was due to the department as kist, and that the same was adjusted from the security deposit maintained by them with the department. They were accordingly asked to replenish the security deposit amount in a like-sum, which they failed to do. It is relevant to note that although the petitioners impugned the order seeking replenishment of security amount through writ petitions preferred before this Court, this Court did not interfere with the same. The petitioners thereafter conducted the business till the expiry of their license in March, 2000. In the meanwhile, on account of the failure on the part of the petitioners to pay the kist amount due to the department, the security deposit maintained by them with the department also stood forfeited by the respondents. It is also not in dispute that the said order forfeiting the security deposit amount was not impugned by the petitioners before any authority.

(2.) While so, when confronted with the revenue recovery proceedings for realisation of an amount of Rs.19,18,909/- together with Rs.18,29,537/- by way of interest, the petitioners approached the Government for availing the benefit of the Amnesty Scheme and for permission to settle the issue on payment of Rs.20 lakhs. Exhibit P2 series of receipts would show that by paying an amount of Rs.20 lakhs, the petitioners settled the issue regarding kist dues of the department finally. In the writ petition, the petitioners seek to quash Ext.P7 order, that was passed by the respondents on an application preferred by the petitioners for refund of the security deposit amounts forfeited by the respondents, on the contention that inasmuch as the petitioners had subsequently settled the liability towards kist dues with the department, there was no justification in the department retaining the security deposit amounts.

(3.) Although the 3 rd respondent had initially passed an order rejecting the contentions of the petitioners for refund of the security deposit amount that was forfeited, the said orders were set aside by this Court in writ petitions preferred by the petitioners citing the judgment of the Supreme Court in V.K Asokan and Others v. Assistant Excise Commissioner and Others - [2009 (5) SCJ 783]. Ultimately, wide Ext.P6 judgment, this Court directed the 3 rd respondent to pass fresh orders in the matter after considering the aforesaid judgment of the Supreme Court and its applicability to the case of the petitioners. Ext.P7 order that is impugned in this writ petition is the order passed by the 3 rd respondent pursuant to the directions of this Court in Exhibit P6 judgment.