GODFREY PHILIPS INDIA LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) To the Petitioner No. 1, Godfrey Philips India Limited, notices to show cause-cum-demand were issued under Section 11A of the Central Excises and Salt Act, (hereinafter referred to as "the Act"), that they are taking deposits from their wholesale buyers and on such deposits they are not paying interest and in turn they are earning huge profits both by earning interest and/or by utilising such amount in purchasing fixed assets and/or procuring raw materials for manufacture of finished products viz. cigarettes and this has helped them in lowering down assessable value on cigarettes. It was stated that this benefit influenced fixation of selling rates of cigarettes on lower side and price paid by such wholesale dealers cannot be treated as sole consideration for the sale. Hence a show cause notice was issued under Section 11A of the Act for allegedly short levy of excise duty by pointing out that on the basis of such under-valuation large amount of approximately Rs. 44 crores of Central Excise was to be recovered, details of which are not required to be given here.

(2.) On the basis of the said show cause notices, the matters were being heard in the office of the 3rd Respondent at Bombay. Thereafter, in a part-heard adjudication, on the basis of order dated 21st March, 1989 passed by the Central Board of Excise and Customs (Respondent No. 4), the matters were transferred to the Director General of Inspection, New Delhi (Respondent No. 2).

(3.) The Petitioners have challenged the said transfer orders by filing this petition. They have prayed that Respondents be directed forthwith to withdraw and cancel the Notification No. 159/84-C.E., dated 10th July, 1984 (Exhibit 'M') and the transfer order dated 21st March, 1989 (Exhibit 'U') and also to restrain the Respondents from taking any steps or proceedings pursuant to the show cause notices dated 28th July, 1983 (Exhibit 'E') and 30th July, 1983 (Exhibit 'I').