KRISHNAKANT SAKHARAM GHAG Vs. UNION OF INDIA

JUDGEMENT

(1.) BY this petition, the petitioner seeks a declaration to the effect that the Notification No. 48/97-CE dated 2/9/97 amending Notification No. 68/63-CE dated 4/5/63 is ultra vires Section 12 of the Central Excise Act, 1944, that the order in original dated 24/12/1991 to the extent it demands interest on delayed payment of duty is illegal and contrary to law and a declaration that even if interest is recoverable pursuant to an order passed by the Delhi High Court, the revenue cannot seek to recover such interest by initiating recovery procedure prescribed under the Act. Accordingly, the petitioner seeks an order for lifting the attachment levied on the property belonging to the petitioner.

(2.) THE basic contention of the petitioner is that, section 12 of the Excise Act does not empower the Central Government to import the recovery provisions contained in the Customs Act, 1962 and, therefore, Notification No. 48/97 issued by the Central Government empowering the excise authorities to invoke the recovery provisions contained in sub-clause (ii) of clause (c) of sub-section (1) of Section 142 of the Customs Act, 1962 in respect of the duties imposed by section 3 is ultra vires section 12 of the Excise Act. It is further contended that at the material time there was no provision under the Excise Act to demand interest on the delayed payment of duty and, therefore, the impugned order in original dated 24/12/91 in so far as it purports to demand interest on delayed payment of duty is illegal and contrary to law. Alternatively, it is contended that assuming the revenue is entitled to recover interest pursuant to an order passed by the Delhi High Court then, such interest levied by the Court has to be recovered as a decree of a Civil Court and not by resorting to the recovery provisions contained in the Excise Act or the Customs Act applied to Excise Act. In other words, the submission is that, where any amount is due to the Government pursuant to an order of the Court and not under the Excise Act or Customs Act, then, that amount ordered by the Court has to be recovered as a decree of a Civil Court in the manner provided in the Code of Civil Procedure and the revenue cannot resort to the machinery prescribed under the Act to recover such amount.

(3.) THE relevant facts are that at the material time the petitioner was a partner in a partnership firm known as M/s. Amit Textile Processors (the firm for short ). The said firm was engaged in the processing of man-made fabrics at its factory at Vikhroli, Bombay.