Allowed

M/S.Larsen & Toubro Ltd. v. Union of India

Madras HC12 Sept 2019WP/19607/2006

Case brief

AI extract

What is this about?

Concurrent excise rebates on exported steel products and their inputs were disputed. Following the Supreme Court's decision permitting both rebates, the court set aside the impugned revision orders and allowed the writ petitions without costs.

What did the court decide?

The impugned revision orders were set aside; all three writ petitions were allowed without costs.

M/S.Larsen & Toubro Ltd. Vs Union of India — Customs and Excise | Madras HC (2019)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED: 12.09.2019

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CORAM

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THE HONOURABLE Dr. JUSTICE ANITA SUMANTH

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W.P.No.19607 to 19609 of 2006

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M/s.Larsen & Toubro Ltd.,
ECC Division,
Mount Poonamallee Road
Manapakkam, Chennai – 89.
...Petitioner in the above W.Ps
Vs.
1. Union of India,
rep. By Joint Secretary,
Department of Revenue,
Ministry of Finance (Revision
Application Unit) Jeevanthi Building,
Parliament Street, New Delhi.
2. Commissioner of Central Excise (Appeals)
Mahatma Gandhi Road,
26/1, Nungambakkam, Chennai – 34.
3. Asst. Commissioner of Central Excise,
Pondicherry.
4. Commissioner of Central Excise, Pondicherry
...Respondents in the above W.Ps

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Prayer:- Writ Petitions filed under Article 226 of the Constitution of India, praying for the issuance of a Writ of Certiorari, calling for the impugned proceedings of the first respondent passed in order File No.321, 322 and 323/2005 dated 31.8.2005 and quash the same.

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For Petitioner: Mr.P.R. Renganath for Mr.R.Raghavan

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For Respondent : Mr.A.P.Srinivas Senior Standing Counsel

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C O M M O N O R D E R

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Heard Mr.P.R. Renganath, learned counsel for petitioner and Mr.A.P.Srinivas, learned Senior Standing Counsel for respondents.

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The petitioner is a company engaged in the manufacture of various goods including re-rolled products of iron and steel (in short 'goods'). The goods are subject to Duty in terms of Section 3 of the Central Excise Act, 1944 (in short 'Act').

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The petitioner had claimed rebate in terms of Rules 12 (1) (a) and 12(1)(b) of the Central Excise Rules, 1944 (in short 'Rules') during the period July, 1998 to April, 1999 in respect of nine (9) export consignments. Just prior thereto, in 1997, the basis of levy of central excise duty was shifted, in terms of Section 3A of the Act from 'quantity of goods manufactured' (and removed) to the 'annual capacity of production'.

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The claims were allowed vide order dated 14.09.1998 by the Assistant Commissioner of Central Excise (R3). Subsequently, the claims were sought to be reversed on the ground that the petitioner had made duel claims, both under Rule 12(1)(a) and 12 (1)(b) at the rate of Rs.300 per MT under the former and on the basis of 12% of value of inputs used in the export goods, under the latter. The proposal to show cause was to deny rebate under Rule 12(1)(b) and modify the claim under Rule 12(1)(a) to 12% of FOB value as against 300 MT, as claimed by the petitioner. The proposal relating to Rule 12(1)(a) was accepted and the petitioner objected only to the proposal under Rule 12 (1)(b). Orders were passed confirming both proposals, as against which statutory appeals were filed before the Commissioner of Central Excise (Appeals) (R2), which came to be allowed.

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The Commissioner of Central Excise (R4), sought a revision of the appellate orders. In all, a total of four revision applications were filed by R4 before the Union of India (R1). The revision applications came to be allowed by R1 holding that the claim under Rule 12(1)(a) is to be restricted to actual duty paid and that the petitioner was not eligible for any claim under Rule 12(1)(b) at all. It is as against the aforesaid order that the present Writ Petitions have been filed.

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The factual details of claims made, show cause notices (SCN) issued, orders-in-original (OIO) passed, appeals filed with appeal references, details of the orders in appeal (OIA), details of revision applications filed and orders passed have

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been tabulated by the petitioner in the Writ Affidavit and are extracted herein for the sake of completion of the narration:

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W.P.No.19607 of 2006:

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Table 1

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(A)	AR-5 No. & Date	1/03.07.98
(B)	Weight in Kgs	190.520
1(a)	Claim under Rule 12(1)(a) @ Rs.300/- per M.T. read with CEN 31.98 dt.24.8.98.	Rs.57,156/-
(b)	Claim under Rule 12(1)(b) read with CEN 42/94 dt.22.9.94 (i.e.) on invoice price of inputs used in export goods	Rs.2,66,300/-
2.	Date of A.C's order allowing claim (details)	14.09.98
(a)	Claim allowed under Rule -12(1) (a)	Rs.57,156/-
(b)	Claim allowed under Rule – 12(1) (b)	Rs.2,66,300/-
3.	Appeal if any filed against order at Sl.No.(2) above with gist of grounds in appeal	Nil
4.	Date of SCN issued for recovery of claim allowed	02.08.99
(a)	Demand in SCN and reasons for	Rs.24,299/-
	demand	SCN states claim
		under Rule-12(1) (b) is not
		sustainable and
		claim under Rule
		12(10(a) to be raised to 12% of FOB issues demand on this basis
5.	O.I.O. (of A.C.) with reference to SCN at Sl.No.(4)	21/2000 dt.6.3.2000
(a)	Amount demanded in the OIO	Rs.24,299/-
6.	L&T Appeal Ref.to CCE(A)	A.No.201/02
7.	O.I.A. with reference to above appeal	429 to 432/03 dt.08.08.03

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8.	Rev.Appeal No.against	OIA at F.No.198/114-
	Sl.No.(7)	116/03-RA CUS
9.	Order in R.A.	321-323/05
		dt.31.8.2005

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Table 2

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(A) AR-5 No. & Date 2/10.09.98 3/10.09.98 4/10.09.98
(B) Weight in KGs 11.100 143.640 115.120
1(a). Claim under Rule Rs.3,330/- Rs.43,092/- Rs.34,536/-
12(1)(a) @
Rs.300/- per M.T.
read with CEN
31/98
dt.24.08.98.
(b). Claim under Rule Rs.19,140/- Rs.2,47,684/ Rs.1,98,507
-
12(1)(b) read /-
with CEN 42/94
dt. 22.09.94
(i.e.) on invoice
price of inputs
used in export
goods.
2. Date of A.C's 05.01.99
order allowing
claim (details)
(a). Claim allowed Rs.3,330/- Rs.43,092/- Rs.34,536/-
under Rule-12(1)
(a)
(b). Claim allowed R.19,140/- Rs.2,47,684/ Rs.1,98,507
-
under Rule-12(1) /-
(b)
3. Appeal if any Nil
filed against
Order at Sl. No.
(2) above with
gist of Grounds
in appeal
4. Date of SCN 01.07.99
issued for
recovery of claim
allowed

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(a)	Demand in SCN and reasons for demand	Rs.4,851/- Rs.62,773/- Rs.50,310/- SCN states claim under Rule-12(1)(b) is not sustainable and claim under Rule-12 (1)(a) to be raised to 12% of FOB. Issues demand on this basis.
5.	O.I.O (of A.C.) with reference to SCN at Sl.No.(3)	285/99 dt.09.12.99
(a)	Amount demanded in the OIO	Rs.4,851/- Rs.62,773/- Rs.50,310/-
6.	L & T Appeal Ref. to CCE (A).	A.No.200/02 (A.No.97/2000-TRY)
7.	O.I.A. with reference to above appeal	429 to 432/03 dt.08.08.03
8.	Rev.Appeal No.against OIA at Sl.No.(7)	F.No.198/114-116/RA.CUS.
9.	Order in R.A.	321-323/05 dt. 31.08.2005
		Table 3
(A)	AR-5 No. & Date 5/18.09. 8	9 6/25.09. 98 7/05.10. 98 8/30.11. 98 9/21.0 4.99
(B)	Weight in KGs. 66.650	149.590 117.590 73.060 63.720
1(a)	Claim under Rule 12(1) (a) @ Rs.300/- Per M.T. r/w CEN 31/98 dt.24.08.98 Rs.19,99 /-	5 Rs. 44,859/- Rs. 35,277/- Rs. 21,918/- Rs. 19,116 /-

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(b) Claim under Rs. Rs. Rs. Rs. Rs.
Rule 12(1)
1,17,084/ 2,63,762 1,66,860 1,03,672 92,222
(b) r/w CEN -
/- /- /- /-
42/94
dt.22.9.94
(i.e.) 12%
on inv.
Price of
inputs used
in export
goods.
2. Date of C.No.V/72/18/162/98 dated 31.8.99
A.C's order
allowing
claim
(details)
(a) Claim Rs. Rs. Rs. Rs. Rs.
allowed
1,04,878/ 2,35,294 1,85,234 1,05,693 87,330
under R-12 -
/- /- /- /-
(1)(a) @ 12%
of FOB value
(b) Claim NIL
allowed
under R-12
(1)(b)
3. Appeal if L & T files appeal against rejection of claim
any filed under Rule-12(1)(b)
against
Appeal Ref.A.No.197/02 (317/99-TRY)
order at
Sl.No.(2)
above with
gist of
grounds in
appeal.
Appeal
reference
4. Date of SCN 29.08.2000
issued for
recovery of
claim
allowed

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(a) Demand in Rs. Rs. Rs. Rs. Rs.
SCN and
84,883/- 1,90,435 1,49,977 83,775/- 68,214
reasons for
/- /- /-
Demand
The SCN states that the claim under Rule-12
(1)(a) 12% of FOB value is subject to actual
duty paid. Hence restricts the claim to that
extent and demands recovery of balance amount
sanctioned.
5. O.I.O. (of 37/2001 dated 29.11.2001. This order confirms
A.C.) with demands as proposed in SCN dt.29.08.2000
reference to referred in Sl.No.4(a) above. This order also
SCN at S.No. rejected petitioner's contention that the SCN
(4) is barred by limitation.
6. L & T Appeal A.No.208/02 (31/02-TRY)
ref. to CCE
(A) with
reference to
order @
Sl.No.(5)
7. O.I.A. with 429 to 432/03 dt. 08.08.2003
reference to
Allows appeals 197/02 & 208/02 in favour of L
above
& T.
appeals at
Sl.Nos.(3) &
(6)
8. Rev. Appeal F.No.198/114-116/RA-CUS/
No. against
OIA at Sl.
No.(7)
9. Order in 321-323/05 dated 31.08.2005
R.A.

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W.P.No.19608 of 2006:

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Table-1

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(A)	AR-5 No.& Date	1/03.07.98
(B)	Weight in KGs	190.520
1 (a)	Claim under Rule 12(1)(a) @ Rs.300/- per M.T.read with CEN 31/98 dt. 24.8.98	Rs.57,156/-
(b)	Claim under Rule-12(1)(b) read with CEN 42/94 dt. 22.9.94 (i.e.) on invoice price of inputs used in export goods.	Rs.2,66,300/-

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Date of A.C.s order allowing claim 14.09.98
(details)
(a) Claim allowed under Rule-12(1)(a) Rs.57,156/-
(b) Claim allowed under Rule-12(1)(b) Rs.2,66,300/-
3. Appeal if any filed against order at Nil
Sl.No.(2) above with gist of grounds
in appeal.
4. Date of SCN issued for recovery of 02.08.99
claim allowed
(a) Demand in SCN and reasons for demand Rs.24,299/-
SCN states claim
under Rule12(1)(b)
is not sustainable
and claim under
Rule-12(1)(a) to be
raised to 12% of
FOB. Issues demand
on this basis.
5. O.I.O. (of A.C.) with reference to 21/2000 dt. 6.3.2000
SCN at Sl.No.(4)
(a) Amount demanded in the OIO Rs.24,299/-
6. L&T Appeal Ref. to CCE (A) A.No.201/02
7. O.I.A. with reference to above appeal 429 to 432/03
dt.08.08.03
8. Rev. Appeal No. against OIA at Sl. F.No.198/114-116/03-
No.(7) RA.CUS
9. Order in R.A. 321-323/05
dt.31.08.2005
Table 2
(A) AR-5 No. & Date 2/10.09.98 3/10.09.98 4/10.09.98
(B) Weight in KGs 11.100 143.640 115.120
1(a). Claim under Rule Rs.3,330/- Rs.43,092/- Rs.34,536/-
12(1)(a) @
Rs.300/- per M.T.
read with CEN
31/98 dt.24.8.98

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(b) Claim under Rule- Rs.19,140/- Rs.2,47,684/ Rs.1,98,507/
- -
12(1)(b) read with
CEN 42/94 dt.
22.9.94 (i.e.) on
invoice price of
inputs used in
export goods
2. Date of A.C's 05.01.99
order Allowing
Claim (details)
(a). Claim allowed Rs.3,330/- Rs.43,092/- Rs.34,536/-
under Rule-12(1)
(b)
(b). Claim allowed Rs.19,140/- Rs.2,47,684/ Rs.1,98,507/
- -
under Rule-12(1)
(b)
3. Appeal if any Nil
filed against
Order at Sl.No.(2)
above with gist of
Grounds in appeal
4. Date of SCN issued 01.07.99
for recovery of
claim allowed
(a). Demand in SCN and Rs.4851/- Rs.62,773/- Rs.50,310/-
reasons for demand
SCN states claim under Rule-12(1)(b)
is not sustainable and claim under
Rule-12(1) (a) to be raised to 12% of
FOB. Demand issued
5. O.I.O. (of A.C.) 285/99 dt. 9.12.99
with reference to
SCN at Sl.No.(3)
(a) Amount Demanded in Rs.4,851/- Rs.62,773/- Rs.50,310/-
the OIO
6. L & T Appeal Ref. A.No.200/02
to CCE(A)
(A.No.97/2000-TRY)
7. O.I.A. with 429 to 432/03
reference to above
dt. 08.08.03
appeal
8. Rev.Appeal No. F.No.198/114-116/RA.CUS.
against OIA at
Sl.No.(7)

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Order in R.A. 321-323/05 dt.31.8.2005

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Table-3
(A) AR-5 No.& 5/18.09.9 6/25.09.98 7/05.10.9 8/30.11/ 9/21.04.
Date 8 8 98 99
(B) Weight in 66,650 149,590 117,590 73,060 63.720
KGs
1 Claim Rs.19,995 Rs.44,859/ Rs.35,277 Rs.21,91 Rs.19,11
-
(a) under /- /- 8/- 6/-
Rule 12
(1)(a) @
Rs.300/-
Per M.T.
r/w/ Cen
31/98 dt.
24.08.98
(b) Claim Rs.1,17,0 Rs.2,63,76 Rs.1,66,8 Rs.1,03, Rs.92,22
under 84/- 2/- 60/- 672/- 2/-
Rule 12
(1) (b)
r/w CEN
42/94 dt.
22.9.94
(i.e.)
12% on
inv.
Price of
inputs
used in
exort
goods.
2. Date of C.No.V/72/18/162/98 dated 31.08.99
A.C's
order
allowing
claim
(details)
(a) Claim Rs.1,04,8 Rs.2,35,29 Rs.1,85,2 Rs.1,05, 87,330/-
. allowed 78/- 4/- 34/- 693/-
under R-
12(1)(a)
@ 12% of
FOB value

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( b Claim NIL ) allowed under R- 12(1)(b)

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1. Appeal if Appeal filed against rejection of claim under any filed Rule-12(1)(b) against Appeal Ref.A.No.197/02(317/99-TRY)

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order at Sl.No. (2) above with gist of grounds in appeal. Appeal reference

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1. Date of 29.08.2000 SCN issued for recovery of claim allowed.

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(a) Demand in Rs.84,883 Rs.1,90,4 Rs.1,49, Rs.83,775 Rs.68,21 SCN and /- 35/977//4/reasons The SCN states that the claim under Rule-12(1)(a)

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for @ 12% of FOB value is subject to actual duty

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Demands. paid. Hence restricts the claim to that extent and demands recovery of balance amount sanctioned.

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1. O.I.O. 37/2001 dated 29.11.2001. This order confirms (of A.C.) demands as proposed in SCN dt.29.8.2000 referred with in Sl.No.4(a) above. This order also rejected reference petitioners' contention that the SCN is barred by to SCN at limitation. Sl.No.(4)

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1. L & T A.No.208/02 (31/02-TRY) Appeal Ref. to CCE (A) with reference to order @ Sl.No. (5)

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O.I.A. 429 to 432/03 dt. 08.08.2003 with Allows appeals 197/02 & 208/02 in favour of L & T

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reference to above

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Rev.Appea F.No.198/114-116/RA-CUS/ l No. against OIA at Sl.No(7)

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Order in 321-323/05 dated 31.08.2005 R.A.

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W.P.No.19609 of 2006:

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Table 1
(A) AR-5 No.& Date 1/03.07.98
(B) Weight in KGS 190.520
Claim under Rule 12(1) (a) @ Rs.57,156/-
1(a) Rs.300/- per M.T.read with CEN
31/98 dt. 24.8.98.
Claim under Rule -12(1)(b) read Rs.2,66,300/-
with CEN 42/94 dt.22.9.94
(b)
(i.e.) on invoice price of
inputs used in export goods
Date of A.C's. order allowing 14.09.98
2.
claim (details)
Claim allowed under Rule - 12 Rs.57,156/-
(a)
(1)(a)
Claim allowed under Rule - 12 Rs.2,66,300/-
(b)
(1)(b)
Appeal if any filed against Nil
3. order at Sl.No.(2) above with
gist of grounds in appeal
Date of SCN issued for recovery 02.08.99
4
of claim allowed
Demand in SCN and reasons for Rs.24,299/- SCN states
demand claim under Rule-12(1)
(b) is not sustainable
(a) and claim under Rule -
12(1)(a) to be raised
to 12% of FOB. Issues
demand on this basis.
O.I.O (of A.C) with reference 21/2000 dt.6.3.2000
5.
to SCN at Sl.No.(4)

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(A) (a)	AR-5 No.& Date 1/03.07.98 amount demanded in the OIO Rs.24,299/-
6.	A&T Appeal Ref.to CCE(A) A.No.201/02
7.	O.I.A.wih reference to above appeal 429 to 432/03 dt.08.08.03
8.	Rev.Appeal No. against OIA at Sl.No.(7) F.No.198/114-11 RA.CUS	6/03-
9.	Order in R.A. 321-323/05 dt.31.08.2005 Table 2
(A)	AR-5 No.& Date 2/10.09.98 3/10.09.98	4/10.09. 98
(B)	Weight in KGS 11.100 143.640	115.120
1(a)	Claim under Rule 12 (1) (a) @ Rs.300/- per M.T.read with CEN 31/98 dt. 24.8.98. Rs. 3,330/- Rs. 43,092	Rs. 34,536/-
(b)	Claim under Rule -12 (1)(b) read with CEN 42/94 dt.22.9.94 Rs. Rs.	Rs.
	(i.e.) on invoice price of inputs used in export goods 19,140/- 2,47,684/-	1,98,507 /-
2.	Date of A.C's. order
	allowing claim (details) 05.01.99
(a)	Claim allowed under Rule - 12(1)(a) Rs. 3,330/- Rs. 43,092/-	Rs. 34,536/-
(b)	Claim allowed under Rule - 12(1)(b) Rs. 19,140/- Rs. 2,47,684	Rs. 1,98,507 /-
3.	Appeal if any filed against order at
	Sl.No.(2) above with gist of Grounds in appeal Nil
4	Date of SCN issued for recovery of claim allowed 01.07.99

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(A) AR-5 No.& Date 4/10.09.
2/10.09.98 3/10.09.98
98
(a) Demand in SCN and Rs. Rs. Rs.
reasons for demand
4,851/- 62,773/- 50,310/-
SCN states claim under Rule-12(1)(b)
is not sustainable and claim under
Rule - 12(1)(a) to be raised to 12%
of FOB. Demand issued accordingly.
5. O.I.O (of A.C.) with
reference to SCN at 285/99 dt.9.12.99
Sl.No.(3)
(a) Amount demanded in Rs. Rs. Rs.
the OIO
4,851/- 62,773/- 50,310/-
6. L&T Appeal Ref. to A.No.200/02
CCE(A)
(A.No.97/2000-TRY)
7. O.I.A.with reference
429 to 432/03
to above appeal
8. Revenues' Appeal
No.against OIA at F.No.198/114-116/RA.CUS
Sl.No.(7)
9. Order in R.A. 321-323/05 dt.31.8.2005
Table – 3
(A) AR-5 No. & 5/18.09. 6/25.09. 7/05.10. 8/30.11. 9/21.04.
Date 98 98 98 98 99
(B) Weight in 66.650 149.590 117.590 73.060 63.720
Kgs.
1 Claim under Rs. Rs. Rs. Rs. Rs.
(a) Rule 12(1)(a)
19,995/- 44,859/- 35,277/- 21,918/- 19,116/-
@ Rs.300/-
Per M.T. r/w
CEN 31/98
dt.24.8.98

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(A) AR-5 No. & 5/18.09. 6/25.09. 7/05.10. 8/30.11. 9/21.04.
Date 98 98 98 98 99
(b) Claim under
Rule 12(1)(b)
r/w CEM 42/94
dt.22.9.94 Rs. Rs. Rs. Rs. Rs.
(i.e.) 12% on
1,17,084 2,63,762 1,66,860 1,03,672 92,222/-
inv. Price of
/- /- /- /-
inputs used
in export
goods.
2. Date of A.C's
order
C No.V/72/18/162/98 dated 31.8.99
allowing
claim
(details
(a) Claim allowed
under R-12(1)
Rs. Rs. Rs. Rs. Rs.
(a) @ 12% of
FOB value 1,04,878 2,35,294 1,85,234 1,05,693 87,330/-
/- /- /- /-
(b) Claim allowed NIL
under R-12(1)
(b)
3. Appeal if any
filed against
L&T files appeal against rejection of claim
order at
under Rule-12(1)(b)
Sl.No.(2)
above with
gist of
Appeal Ref.A.No.197/02 (317/99-TRY)
grounds in
appeal.
Appeal
reference.
4. Date of SCN 29.08.2000
issued for
recover of
claim
allowed.

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(A)	AR-5 No. & Date 5/18.09. 98 6/25.09. 98 7/05.10. 98 8/30.11. 98 9/21.04. 99
(a)	Demand in SCN and reasons for Demand Rs. 84,883/- Rs. 1,90,435 /- Rs. 1,49,977 /- Rs. 83,775/- Rs. 68,214/-
	The SCN states that the claim under Rule-12 (1)(a) @ 12% of FOB value is subjecct to actual duty paid. Hence restricts the claim to that extent and demands recovery of balance amount sanctioned.
5.	O.I.O.(of A.C.) with reference to SCN at Sl.No. (4) 37/2001 dated 29.11.2001. This order confirms demands as proposed in SCN dt.29.8.2000 referred in Sl.No.4(a) above. This order also rejected petitioners' contention that the SCN is barred by limitation.
6.	L & T Appeal Ref. To CCE (A).with reference to A.No.208/02 (31/02-TRY)
	order @ Sl.No.(5)
7.	O.I.A. With reference to above appeals at Sl.Nos. (3) & (6) 429 to 432/03 dt.08.08.2003 Allows appeals 197/02 & 208/02 in favour of L & T.
8.	Rev. Appeal No. Against OIA at Sl.No. (7) F. No. 198/114-116/RA-CUS/
9.	Order in R.A. 321-323/05 dated 31.08.2005

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Two Notifications are relevant to appreciate the issue at hand: Notification No.42/94-CE (NT) dated 21.09.1994 that deals with grant of rebate on materials used in the manufacture of goods for export outside India, i.e., inputs for exports and Notification No.31/98- CE (NT) dated 24.08.1998 that grants a rebate of duty on export of non-alloy steel ingots/billets and hot re-rolling products to any Country, except Nepal and Bhutan. The proviso to the latter Notification states that no rebate of duty paid under Section 3A of the Act on materials used on such exports shall be claimed.

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¶70

The issue of grant of rebate to a manufacturer/exporter on excise duty, where duty has been paid on the final product as well as on the inputs that have gone into manufacturing of the products where such products were ultimately exported, came up for consideration before a Division Bench of the Supreme Court in the case of Spentex Industries Ltd. Vs. Commissioner of Central Excise [(2015) 324 ELT 686]. At paragraph 9, the Bench crystallises the lis before it as follows:

¶71

Obviously, the controversy that arises is qua interpretation that is to be accorded to Rule 18. The Rule stipulates that the Central Government may, by notification, grant rebate of duty paid on such excisable goods OR duty paid on material used in the manufacturing or processing of such goods. The word 'OR' which is used in between the two kinds of duties in respect of which rebate can be granted is the bone of contention and it is to be interpreted whether it postulates grant of one of the two duties or both the duties can be claimed. It is also to be noted at this stage itself that Rule 18 is only an enabling provision which empowers the Central Government to issue a notification for grant of these rebates and prescribes the procedure for claiming such rebate(s).

¶72

The Bench notices Notification No.19/2004 – C.E.(NT) dated 06.09.2004 and Notification No.21/2004 – C.E. (NT) also dated 06.09.2004, relevant portions of which are extracted below:

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The Central Government has issued Notification No. 19/2004-CE(NT) dated September 06, 2004 which deals with grant of rebate of whole of duty on excisable goods exported. The opening portion of this Notification, which needs to be taken note of, is as under:

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“In exercise of the powers conferred by rule 18 of the Central Excise Rules, 2002 and in supersession of the Ministry of Finance, Department of Revenue, notification No. 40/2001Central Excise (N.T.), dated the 26th June 2001, [G.S.R. 469(E), dated the 26th June, 2001] insofar as it relates to export to the countries other than Nepal and Bhutan, the Central Government hereby directs that there shall be granted rebate of the whole of the duty paid on all excisable goods falling under the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) exported to any country other than Nepal and Bhutan, subject to the conditions, limitations and procedures specified hereinafter-

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xxx xxx xxx”

¶77

13........Notification No. 21/2004- CE(N.T.); dated September 06, 2004 issued by the Government for claiming rebate of whole of the duty paid on excisable goods used in the manufacture or processing of exported goods, as is clear from the reading of the opening para thereof:

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“In exercise of the powers conferred by rule 18 of the Central Excise Rules, 2002 and in supersession of the Ministry of Finance, Department of Revenue, notification No. 41/2001Central Excise (N.T.), dated the 26th June, 2001 [G.S.R. 470(E) dated the 26th June 2001], the Central Government hereby, directs that rebate of whole of the duty paid on excisable goods (hereinafter referred to as 'materials') used in the manufacture or processing of export goods shall, on their exportation out of India, to any country except Nepal and Bhutan, be paid subject to the conditions and the procedure specified hereinafter.”

¶79

Form A.R.E.-2 that was prescribed under Notification No.21/2004 – C.E. (NT) dated 06.09.2004 to enable the assessee to claim both kinds of rebate was also noticed by the Supreme Court. The relevant portion of Form in A.R.E.-2 is as under: 'Form A.R.E. 2 Combined application for removal of goods for export under claim for rebate of duty paid on excisable materials used in the manufacture and packing of such goods and removal of dutiable excisable goods for export under claim for rebate of finished stage Central Excise Duty or under bond without payment of finished stage Central Excise Duty leviable on export goods.

¶80

To The Superintendent of Central Excise, (Address) …...............(full postal address)

¶81

Particulars of the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise from whom rebate shall be claimed/with whom bond is executed and his complete postal address__________

¶82

I/We_________of _____ propose to export the under mentioned goods (details of which are given in Table 1 below) to ____ (country of destination) by air/sea/land/post parcel under claim for rebate of duty paid on excisable materials used in the manufacture and packing of such goods.

¶83

*The finished goods being exported are not dutiable.

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¶85

¶86

We intended to claim the rebate of Central Excise Duty paid on clearances of goods for export under notification No. 19/2004-Central Excise (N.T.), dated the 6th September, 2004 issued under Rule 18 of Central Excise Rules, 2002.'

¶87

The Bench at paragraph 16 dilates on the historical perspective of the Scheme for grant of rebate noticing specifically Rules 12 and 13 that provide for two methodologies to enable an exporter to obtain relief from payment of excise duty, the one on the inputs and the other on excisable goods that are exported. Thus, duality or concurrent claim was permissible and was always part of the statutory scheme. The principal of contemporanea expositio was also invoked by the Bench and the observations of the Court in Desh Bandhu Gupta and Co. and Others Vs. Delhi Stock Exchange Association Ltd. [(1979) 3 SCC 373] as extracted below were cited to lend support to the issuance of two Notifications both giving effect to Rule 18 of the Rules.

¶88

“9. It may be stated that it was not disputed before us that these two documents which came into existence almost simultaneously with the issuance of the notification could be looked at for finding out the true intention of the Government in issuing the notification in question, particularly in regard to the manner in which outstanding transactions were to be closed or liquidated. The principle of contemporanea expositio (interpreting a statute or any other document by reference to the exposition it has received from contemporary authority) can be invoked though the same will not always be decisive of the question of construction. (Maxwell 12th Edn. p. 268). In Crawford on Statutory Construction (1940 Edn.) in para 219 (at pp. 393-395) it has been stated that administrative or executive officers charged with executing a statute) generally should be clearly wrong before it is overturned; such a construction commonly referred to as practical construction although not controlling, is nevertheless entitled to considerable weight it is highly persuasive. In Baleshwar Bagarti v. Bhagirathi Dass (1908) ILR 35 Cal 701 at 713 the principle which was reiterated in Mathura Mohan Saha v. Ram Kumar Saha, ILR 43 Cal. 790: (AIR 1916 Cal. 136) has been stated by Mukerjea J. thus:

¶89

“It is a well-settled principle of construction that courts in construing a statute will give much weight to the interpretation put upon it, at the time of its enactment and since, by those whose duty it has been to construe, execute and apply it. I do not suggest for a

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¶91

moment that such interpretation has by any means a controlling effect upon the Courts; such interpretation may, if occasion arises have to be disregarded for cogent and persuasive reasons, and in a clear case of error, a Court would without hesitation refuse to follow such construction.”

¶92

After an exhaustive discussion, the Bench concludes holding that the petitioner (in that case) was entitled to claim both rebates and that no restriction was envisaged thereof.

¶93

Respectfully following the judgment of the Supreme Court as aforesaid, the impugned orders are set aside and these Writ Petitions are allowed. No costs.

¶94

-s/d-
Assistant Registrar(CS-I)
True Copy
Sub-Assistant Registrar
ska/sl
To
1. Union of India,
rep. By Joint Secretary,
Department of Revenue,
Ministry of Finance (Revision
Application Unit) Jeevanthi Building,
Parliament Street, New Delhi.
2. Commissioner of Central Excise (Appeals)
Mahatma Gandhi Road,
26/1, Nungambakkam, Chennai – 34.
3. Asst. Commissioner of Central Excise,
Pondicherry.
4. Commissioner of Central Excise, Pondicherry
+1 CC to Mr.R. Raghavan, Advocate sr 78770.
+1 CC to Mr.A.P. Srinivas, Advocate sr 78901.
W.P.No.19607 to 19609 of 2006

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EV(CO) SP(11/02/2020)

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M/S.Larsen & Toubro Ltd. v. Union of India

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What is this about?

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M/S.Larsen & Toubro Ltd. v. Union of India

Case brief

What is this about?

What did the court decide?

What the court decided

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