SARDA PLYWOOD INDUSTRIES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an appeal against the judgment and order dated 28 -5 -96 of the learned single judge dismissing Civil Rule No. 5316/95.

(2.) THE facts briefly are that M/s Sarda Plywood Industries Limited (for short 'the appellant') manufactures and sells a wide variety of plywood products including block boards in its factory at Jaipur in Assam. The appellant filed classification list w.e.f. 1 -3 -92 declaring that the block boards manufactured in its factory were 'articles of wood not else were specified' as described in heading 44.10 of the Schedule of the Central Excise Tariff Act, 1985 (for short 'the Central Excise Tariff) liable to excise duty at the rate of 15% ad -valorem under Sub -heading 44.10.90 thereof but exempted under notification No. 48/87 dated 1 -3 -87. But a. show cause notice dated 1 -5 -92 was issued by the department to the appellant to show cause as to why block boards should not be classified as 'Similar laminated wood' described under heading No. 44.08 of the Central Excise Tariff liable to excise duty at the rate of 30% ad -valorem under sub -heading No. 44.08.90 thereof. The appellant filed Civil Rule No. 833/92 before this Court for appropriate relief and on 20.5.92 this Court passed interim orders in the said Civil Rule allowing levy of excise duty on such block boards at the rate of 15% ad -valorem pending disposal of the writ petition. The appellant again moved this Court on 26 -6 -92 for exemption of excise duty under notification No. 48/87 dated 1 -3 -87 but the Court refused to allow such exemption at the interim stage.

(3.) THE Superintendent of Customs and Central Excise, Naharkatia Range III then issued show -cause -cum -demand notice dated 6 -7 -95 stating therein that the Supreme Court in its judgment dated 20 -3 -95 has classified block boards under Sub -heading 44.08.90 and that the appellant was required to pay Central Excise duty for the 3 periods : November. 1989 to March, 1990, April, 1991 to October, 1991 and March 1992 to January, 1993. The annexures to the said notice indicates that a sum of Rs. 2,29,90,563.88 as basic duty and Rs. 52,65,758.58 as special duty were to be paid in respect of block boards cleared during the period from March, 1992 to January, 1993. By the said notice, the appellant was asked to show -cause as to why the aforesaid duty should not be demanded and paid by the appellant under Section 11 -A(1) of the Central Excise and Salt Act, 1944 (for short the 'Act'). In response to the said show -cause -cum -demand notice, the appellant filed its reply contending, inter alia, that the show -cause -cum -demand notice was barred by limitation under the provisions of Sub -section (1) of Section 11A of the Act. But by order dated 27 -11 -95, the Assistant Commissioner, Central Excise, Dibrugarh, held that for the period March, 1992 to January 1993, by the communication dated 9 -2 -93, the concerned range superintendent had finalised the provisional assessment as per decision dated 6.1.93 of this Court in Civil Rule 832/92 which had been affirmed by the Supreme Court, but the appellant had not adjusted the duty thereafter and hence Section 11 -A(1) of the Act was not applicable before adjustment of duty of excise after such final assessment. The department then invoked the bank guarantee for Rs. 85,00,322.00 on 29 -11 -95 and a bank draft for Rs. 85,00,322.00 was issued by the State Bank of India, respondent No. 5. on 6 -12 -95 against the said bank guarantee by debiting the said amount to the account of the appellant. Aggrieved, the appellant filed Civil Rule No. 5316/95 under Article 226 of the Constitution with a prayer for quashing the said communication dated 9 -2 -93 of the Superintendent of Customs and Central Excise, Naharkatia Range III, demanding excise duty pursuant to decision of this Court dated 6 -1 -93 in Civil Rule 833/ 92 and for a direction on the respondents No, 1, 2, 3, and 4 not. to encash the bank draft issued by the respondent No. 5. While issuing notice of motion in the said Civil Rule, the learned single Judge passed interim orders on 13 -12 -95 directing that the department may receive the Bank Draft, but it will not be encashed until further orders. But ultimately by the impugned judgment and order 28 -5 -96, the learned single Judge dismissed the said Civil Rule.