ISSA INDUSTRIES Vs. UNION OF INDIA

JUDGEMENT

(1.) SHOULD a person be denied grant of certificate enabling him to claim exemption from payment of duty of excise or additional duty of excise in respect of the supply of goods made by him to an international organization merely on the ground that he had not sought for grant of exemption certificate before making the supply, particularly, when it is not disputed that the supply, so made, is in terms of the notification, dated 28. 08. 2005, issued, in this regards, in respect of goods falling under the Central Excise Tariff Act, 1985. This is the moot question, which the present writ petition has raised.

(2.) I have heard Dr. A. K. Saraf, learned Senior counsel, for the petitioner, and Mr. N. Bora, learned Central Government Counsel, appearing on behalf of the respondents.

(3.) BEFORE I deal with the issue raised for determination in this writ petition, let met take note of the admitted facts giving rise to this writ petition. These facts are, in brief, thus : Respondent No. 3, namely, Rail India Technical and Economic Services Ltd. is a Government of India undertaking with respondent No. 4 as its General Manager. By a Notice Inviting Tender (in short, "nit"), published, on 20. 7. 2000, the Ministry of Health and Family Welfare, Government of India, invited, through respondent No. 3, sealed bids from eligible bidders for supply of 60,000 mosquito bed nets for Malaria Control Project, which was sponsored by the International Development Organisation. The writ petitioner, namely, Issa Industries, which is a proprietary firm, participated in the said selection process by offering its bid. By a communication, dated 02. 11. 2000, respondent No. 4 informed the petitioner that the petitioner's bid had been accepted. On such acceptance of the bid, the petitioner made necessary supplies of the said mosquito bed nets. The petitioner, thereafter, applied to the respondent No. 4 for Project Authority Certificate in order to enable the petitioner to claim exemption from payment of excise duty in respect of the mosquito bed nets, which had been so supplied. While the respondent No. 3 did not react to the request for the Project Authority Certificate made by the petitioner, respondent No. 5, namely, Additional Director, Directorate General of Central Excise, East Zonal Unit, Kolkata, served a notice, dated 29. 01. 2003, on the petitioner directing it to show cause as to why the petitioner shall not be made to pay Central Excise Duty on the said supply of the mosquito bed nets inasmuch as the requisite certificate entitling the petitioner to claim exemption from payment of central excise duty had not been granted by the respondent No. 3. As repeated representations made by the petitioner to the respondent No. 3 for issuance of the Project Authority Certificate has not yielded any favourable result, the writ petitioner has, now, approached this Court seeking, with the help of this application made under Article 226 of the Constitution of India, issuance of appropriate Writ (s) commanding respondent No. 3 to issue Project Authority Certificate in favour of the petitioner, the petitioner's case being, in brief, thus : By a notification, dated 28. 08. 1995, issued in exercise of powers conferred by Sub-Section (1) of Sub-Section 5 A of the Central Excise and Sale Act, 1944, read with Sub-Section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957, all goods, falling under Central Excise Tariff Act, 1985, stand exempted from payment of excise duty if the supply of the goods is made to, amongst others, a project financed by the World Bank, Asian Development Bank or any international organization other than those listed in the Annexure to the said notification. As the petitioner has made supply of the said mosquito bed nets to an international organization, which is covered by the said notification and when such supply is exempted from payment of excise duty, the petitioner ought to have been granted, on the request made by it, requisite certificate by the respondent No. 3. Denial of such certificate by the respondent No. 3 is, contends the petitioner, arbitrary, unreasonable and also discriminatory inasmuch as suppliers, who had made similar supplies in the past, had been issued requisite certificate by respondent No. 3.