Mahindra AND Mahindra Ltd. vs LIONS CLUB REWA, LIONS EYE HOSPITAL

PETITIONER was opposite party No. 2 before the District Forum, Rewa. He is manufacturer of motor vehicles. Opposite party No. 1 Star Automobiles is its dealer. Complainant who is now first respondent before us filed a complaint in the District Forum alleging deficiency in service by both the opposite parties. Its case was that it was running an Eye Hospital in Rewa and for that purpose it purchased a van manufactured by the petitioner on 3.3.1997 for Rs. 3,75,785/-. The van was purchased from the dealer. It is not disputed that the van was converted into ambulance and was duly registered with the RTO, Rewa. After the vehicle was registered with RTO complainant sent a form duly filled up to the dealer by registered post on 9.5.1997 for payment to it of the excise subsidy. On 13.11.1997 complainant sent a letter along with permission dated 21.12.1993 from the Health Department of the State Government of Madhya Pradesh, Rewa Office permitting the complainant to run Eye Hospital. This was given to the dealer. This was on account of the fact that complainant was entitled to 15% excise subsidy on the total price after registration of the jeep as ambulance. In spite of various letters and visits to the dealer nothing transpired and ultimately a legal notice was sent by registered post to both the dealer and the manufacturer but that too without effect. This led to the filing of the complaint.

IT was the case of the dealer that it was merely acting as a Post Office and it was for the manufacturer - the petitioner to claim refund of the excise duty from the Central Excise Department. The dealer said it was in turn approaching the petitioner and it was not, therefore, negligent. Petitioner denied the claim of the complainant altogether and said that the complaint was not maintainable. The question that arose before the District Forum was whether service rendered by the manufacturer and the dealer was deficient. Complainant led evidence to show that it was guaranteed by the dealer that it will be entitled to refund of 15% subsidy on registration of the vehicle as ambulance. Since the amount of subsidy was not refunded to the complainant in spite of his approaching the dealer and manufacturer time and again, District Forum allowed the complaint and held that complainant was entitled to Rs. 56,367/- as 15% excise subsidy from the dealer and also cost of Rs. 500/-. Against that order of the District Forum, the dealer filed appeal before the State Commission. The petitioner-manufacturer was also one of the respondents. State Commission found that it was the responsibility of the manufacturer for claiming refund of the excise duty and not that of the dealer. State Commission, therefore, modified the order of the District Forum to the extent it was held that both the dealer and the manufacturer would be jointly and severally liable to make the payment. It is also ordered that in case the dealer makes the payment he shall be entitled to recover the same from the manufacturer. Now it is the manufacturer feeling aggrieved who has filed this petition.

When the matter came up before us for admission we passed the following order : "Our attention has been drawn to Clause (e) of Exemption Notification No. 66 (Page 39) where exemption has been granted to ambulance of the Government Hospitals or the Hospitals which are registered with the Government Department or local authorities. It is stated that the Hospital of the IInd respondent/complainant is not so registered. However, there is a letter by which Health Department of the State of Madhya Pradesh has allowed the IInd respondent/complainant to run the Eye Hospital. Though we issue notice, we require the petitioner to apply to the Central Excise Authorities for refund of the Central Excise duty as permissible under the aforesaid notification. List this Revision Petition on 17.7.2001."

IN pursuance of that order petitioner did apply seeking refund but that application was rejected by the Deputy Commissioner, Central Excise vide order dated 24.5.2001. That order has been brought on record, relevant para of which we reproduce as under : "3. The details of the refund claim, in brief, are that a vehicle falling under Ch. No. 87.03 clearned on payment of duty @ 40% adv., on invoice No. 1690 dated 19.11.1996 was subsequently registered as Ambulance in the name of "Rewa Lions Eye Hospital", on 13.3.1997 with the R.T.O., Rewa. According to the notification, (i) the manufacturer has to furnish a certificate from the R.T.O. to the effect that motor vehicle has been registered as ambulance, within three months of the clearance of the said motor vehicle from the factory or such extended period as the Asstt. Commissioner may allow. IN this case, the manufacturer did not request for extension for this purpose, (ii) the exemption in case of ambulance is only applicable for hospitals, nursing homes etc. as the Central Government may notify in the Official Gazette. The vehicle was registered as ambulance in the name of Rewa Lions Eye Hospital. From a copy of Certificate No. 643, issued by the Government of Madhya Pradesh, it seems that the certificate was issued to "Lions Club, Rewa", which was registered on 14.9.1993 under Societies Registration Act, 1973 (S. No. 44 of 1973). The assessee also filed a copy of letter dated 21.12.1993, issued by the Chief of Medical and Health Department, Rewa, permitting the Lions Eye Hospital, Rewa to conduct eye related surgeries/operations. However, the manufacturer did not produce any documents evidencing that the Lions Eye Hospital, Rewa was notified by the Central Government in the Official Gazette, (iii) the refund claim should be filed in terms of Section 11-B of the Central Excise Act.

On verification of the refund claim, it appeared that the refund claim was not filed in time under Section 11-B of C.E. Act. And is liable for rejection. IN view of the foregoing, I pass the following order. ORDER "I reject the refund application dated 24.5.2001 filed by the assessees under Section 11-B of Central Excise Act, 1944."

It could not be disputed that immediately the van was registered as ambulance; a letter was addressed by the complainant to the dealer who had promised that complainant would be entitled to refund of 15% of the excise duty in case the vehicle is registered as an ambulance. Now the dealer says he had been writing to the manufacturer requiring it to seek refund. But there was no action on the part of the manufacturer. It was contended before us that Eye Hospital run by the complainant is not totally registered under the relevant notification General Exemption No. 66 which is issued under the Central Excise Act, 1944 by the Central Government. It is not disputed that there could not be refund of excise duty @ 15% in case the vehicle was registered as ambulance. This exemption applied under the following circumstances : "43. (a) ... (e) In the case of ambulance, the concessional rate of duty shall apply only when the ambulance is supplied to : (i) hospitals, nursing homes or sanatoriums run by the Central Governments or a State Government or a Union Territory Administration or a local authority, or are registered as such with; (ii) any Department of the Central Government, or a State Government or a Union Territory Administration or a local authority; or (iii) the Indian Red Cross Society."

NOW it will be seen from the order of the Deputy Commissioner that he rejected the claim of the petitioner-manufacturer who had applied for refund on the ground that claim application was not filed within time under Section 11-B of the Central Excise Act. It is for the first time before this Commission that an issue is being raised that complainant-Hospital does not satisfy the conditions for claiming exemption. In our view, case of the complainant falls within the exemption notification. Even otherwise it has to receive a liberal construction inasmuch as it is for the benefit of the patients. But the fact remains that till we passed the order on 19.3.2001 requiring the petitioner to seek refund on the basis of the notification at no point of time petitioner ever informed the complainant that he was ineligible and no application seeking refund was at all filed. It is a clear case of deficiency on the part of the petitioner, the manufacturer. We, therefore, find no ground for us to interfere with the impugned order of the State Commission in our jurisdiction under Clause (b) of Section 21 of the Consumer Protection Act, 1986. This revision petition is dismissed. Since the petitioner was availing stay of the impugned order we direct that the amount as awarded by the District Forum shall be paid to the complainant with interest @ 12% per annum from the date of the order of the State Commission till payment. Complainant shall also be entitled to cost which we assess at Rs. 2,000/-. Revision Petition dismissed.