GATIMAN AUTO PVT LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner-company has felt aggrieved against a detention order dated March 4, 2005, Annexure P/14, whereby the Machinery/Plant of the petitioner-company has been ordered to be detained vide panchnama dated March 4, 2005, Annexure P/15.

(2.) It has been claimed by the petitioner-company that it was a purchaser of the industrial unit from M.P.F.C. The aforesaid industrial unit was originally owned and being run by M/s. Ganga Sagar and Company Pvt. Ltd. but the aforesaid company became defaulter of the Financial Corporation and as such was taken over and ultimately the said industrial unit was sold and was purchased by the petitioner-company. It appears from the record that there were certain excise dues under Central Excise Act 1944 payable by the aforesaid M/s Ganga Sagar Pvt. Ltd. but the said liabilities were not discharged. After unit was purchased and run by the petitioner-company, plant and machinery of the petitioner-company was detained by the Central Excise department and the detention order was passed. It has been pleaded by the petitioner-company that the aforesaid action was wholly unauthorized and without jurisdiction.

(3.) The claim of the petitioner-company has been contested by the respondents. The primary reliance has been placed upon proviso to Section 11 of the Act. It has been maintained that the said proviso gave a power to the department to recover the dues from the excisable goods, material, preparation, plants, machineries etc., when the original manufacturing unit had been sold by the earlier management with the liabilities to pay excise duties to a new owner. Reliance in this regard has also been placed upon Rule 230(2) of the Central Excise Rules, 1944 .