GODFREY PHILIPS INDIA LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) Rule, by consent returnable forthwith. With the consent of the learned counsel appearing for the contesting parties, Writ Petition 967 of 2011 is taken up on Board. Both these Petitions are taken up for hearing and final disposal by consent.

(2.) The Petitioners have impugned the validity of an order dated 4 January 2011 passed by the Deputy Commissioner of Central Excise, Pune, the Third Respondent in suo moto revision of determination orders passed on 26 October 2009 and 18 December 2009. The challenge before the Court is on the ground that (i) The order has been passed in violation of the principles of natural justice; (ii) There was an inherent lack of jurisdiction on the part of the Deputy Commissioner to pass a revised order; (iii) The order is contrary to binding orders passed by the Commissioner (Appeals) on 28 September 2010 and 3 November 2010; and (iv) The order is an attempt to over reach an interim order passed by this Court initially on 6 December 2010 and continued thereafter in Writ Petition 894 of 2011.

(3.) The Petitioner is engaged in the manufacture of pan masala covered by Chapter Heading No. 2106.90.20 of the First Schedule to the Central Excise Tariff Act, 1985, at a factory situated at Baramati. The Petitioner installed four Form, Fill and Seal machines in its factory for the packing of pan masala into pouches bearing different retail sale prices. Pan masala manufactured by the Petitioner is subject to the levy of central excise duty under Section 3A of the Central Excise Act, 1944. The Central Government has notified the Pan Masala Packing Machine (Capacity Determination and Collection of Duty) Rules, 2008 on 1 July 2008, Under Rule 6 a manufacturer of notified goods has to furnish in Form-I information pertaining to the packing machines to be used by him before the commencement of commercial production. Under sub-rule (2) of Rule 6, on the receipt of a declaration referred to in sub-rule (1), the Deputy Commissioner of Central Excise or, as the case may be, the Assistant Commissioner is required after making such enquiry as may be necessary including physical verification, to approve the declaration and to determine and pass an order concerning the annual capacity production of the factory. The declaration in Form-1 which precedes the order of the Deputy Commissioner requires the manufacturer to inter alia furnish information about the number of single track packing machines available in the factory, the number of packing machines out of that which are installed and the number of packing machines therefrom which he intends to operate for the production of notified goods. Sub-rule (6) of Rule 6 stipulates that in case the manufacturer wishes to make any subsequent changes with respect to any of the parameters declared by him and approved by the Deputy Commissioner or the Assistant Commissioner such as inter alia changes relating to the addition or removal of packing machines in the factory or in the number of machines to be used or commencing manufacture of goods of a new retail sale price or discontinuation of the manufacturing of goods of an existing retail sale price, he shall file a fresh declaration in advance to the Deputy Commissioner who shall approve such fresh declaration and redetermine the annual capacity of production following the procedure specified in sub-rule (2). Under Rule 7 the duty payable for a particular month is to be calculated by the application of the appropriate rate of duty specified in the notification of the Government of India dated 1 July 2008 to the number of operating packing machines during the month. Under Rule 8 in case of addition or installation or removal or uninstallation of packing machines during the month, the number of operating packing machines for the month shall be taken as the maximum number of packing machines installed on any day during the month.