IMCOLA EXPORTS LTD Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) The appellant, who is the holder of ML-2 Licence issued by the Commissioner of Excise under Rule 4(1) and 7(1) of the Tamil nadu Molasses Control and Regulation Rules, 1958, (hereinafter referred to as "Molasses Control Rules") purchased 5000 MT Molasses from M/s.Sudalagunta Sugars Limited, Andhra Pradesh on 30 July 2012 and imported it into the State of Tamil Nadu for export. A surprise inspection conducted by the Assistant Commissioner, Prohibition and Excise Department revealed that the appellant stored 7785.925 MT of Molasses in their storage tank inside the Chennai Harbour. The Assistant Commissioner on verification of the records from September 2012 to 21 December 2012 satisfied that the appellant without obtaining licence in ML-5 imported Molasses and kept it in their storage point at Chennai Harbour. The appellant paid the administrative charges in accordance with Rule 7 of the Molasses Control Rules. Thereafter, the appellant filed two writ petitions, one for refund of the amount collected by the Excise authorities and another for prohibiting the Excise Department from demanding administrative service fee in respect of transactions involving purchase of Molasses from outside Tamil Nadu and exported outside India through the Chennai Port. While dismissing the writ petitions, the learned Judge opined that even without an intention to sell at the place where it was stored, but as part of the business by way of export sales, the transactions would attract the provisions of the Molasses Control Rules. The common order is under challenge at the instance of the writ petitioner.

(2.) The learned Senior Counsel for the appellant contended that the appellant purchased 5000 MT Molasses from M/s.Sudalagunta Sugars Limited, Andhra Pradesh on 30 July 201 The administrative fee for exporting the Molasses out of Andhra Pradesh was paid by M/s. Sudalagunta Sugars Limited for and on behalf of the appellant. The appellant took the molasses to Tamil Nadu only for export. Since Molasses was taken to Tamil Nadu only in the course of transit, there is no liability to take either a licence in Form No.5 or payment of administrative fee under Rule 7(2) of the Molasses Control Rules. The learned Senior ounsel contended that there was no allegation that the appellant indulged in local sale. The Molasses was kept inside the Chennai Port Trust for the purpose of export. Therefore, the appellant is not liable to pay the administrative charges. The learned Senior Counsel submitted that the administrative charges was collected forcibly and as such, the appellant was correct in filing a writ petition for refund of the amount.

(3.) The learned Additional Advocate General appearing on behalf of the State contended that the appellant kept the Molasses purchased from Andhra Pradesh along with the stock covered by the licence obtained in ML-2. There was no segregation. The learned Additional Advocate General on the strength of the documents available on record contended that the appellant stored 7785.925 MT of Molasses inside the Chennai Harbour. There was no entry in the records indicating that 5000 MT of Molasses was intended for export and the remaining for local sale. The learned Additional Advocate General further contended that there were allegations that the appellant and other dealers in Molasses were indulging in local sale of Molasses under the guise of export. The Enforcement Wing of the Prohibition and Excise Department unearthed the malpractice committed by the appellant. Thereafter, administrative charges were paid. It was further contended that the appellant is liable to pay administrative charges even for import into the local area for export out of the local area in case Molasses is imported from a place outside Tamil Nadu.