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Judgment
The petitioner, a registered company under the Companies Act is carrying on the business of manufacturing of M.S Ingots at Kotdwar (Uttrakhand). Two consignments of M.S. Ingots were being transported through two trucks bearing registration No. HR-38 J 0017 and HR -37 A 4167 were intercepted by the officials of the Central Excise Department at District Muzaffarnagar. Goods and trucks were detained on 24-8-2009 and were seized on 14-9-2009.
The respondent-department, suspected that the goods in question are contraband in nature. The petitioner applied for the release of the aforesaid trucks and goods. The Suptd., (Prevention), Custom and Central Excise, Division IInd, Muzaffarnagar asked the petitioner to furnish two bonds of amount of Rs. 5,40,000/- and 4,50,000/- and two FDRs of the value of Rs 1,35,000/- and Rs. 1,12,500/- for provisional release of the trucks. Similarly, the Department has sought for two bonds for Rs. 5,40,000/- and Rs. 4,50,000/- and two FDRs for Rs. 1,35,000/- and Rs. 1,12,500/- for the provisional release of the goods Challenging these orders, the writ petition has been filed.
When the matter was taken up earlier, it was contended by the petitioner that no excise duty is payable on the goods in question and therefore, the seizure order is wholly arbitrary and illegal. This Court on 13-10-2009 passed the following order:
leard learned Counsel for the parties and perused the record. Notice on behalf of respondent Nos. 2, 3 and 4 has been accepted by Sri Zafar Munis, Advocate. The present writ petition has been filed against order dated 24th of September, 2009 passed by the Superintendent Prevention), Custom and Central Excise, Division IInd, Muzaffarnagar releasing the goods provisionally on fulfillment of the conditions specified therein.
The contention of the learned Counsel for the petitioners is that the goods which have been detained are not excisable goods and no duty is payble. Petitioners, Unit is exempted from the payment of any duty in view of the Notification - General Exemption No. 42 clause 2(b) thereof which provides where an option has been exercised in writing on or before 30th day of November, 2003, exemption shall be granted on the condition specified therein. A bare perusal of the impugned order would show that the authority concerned has failed to address the said issue, may be, it was not brought to its notice. As an interim measure it is, therefore, provided that the said authority shall relook into the matter and examine the claim of the petitioners with regard to the exemption claimed on the detained goods. The authority concerned is required to take a decision within a week from the date of production of the certified copy of this order.
The learned standing counsel may communicate this order to the authority concerned also. Two weeks time is granted to file counter affidavit. List the petition for admission on 29th of October, 2009.
On the next date, the department filed a counter affidavit to which a rejoinder affidavit has been filed. Along with the counter affidavit, a copy of the order dated 20-10-2009 passed in pursuance of the above order of this Court has been annexed. A bare perusal of the said order would show that the authority concerned has noted the facts of the case. It is interesting to note that that the authority concerned has noticed that M/s. Podar Alloys Pvt. Ltd. situate in Kotdwar and availing area based exemption under Notification No. 50/2003-C.E., dated 10-6-2003. It has not been found that the case of the petitioner that its unit is exempted from payment of Central Excise Duty is incorrect. The order dated 20-10-2009 supports the case of the petitioner that the petitioner is availing the exemption notification. The petitioner as a matter of fact entitled for the exemption notification is thus established. The detention and seizure orders therefore are bad.
In this view of the matter, we are of the opinion that the conditions levied by the impugned order for provisional release of the goods and truck are wholly arbitrary and highly excessive.
We consequently, modify the terms and conditions for the release of the goods and the vehicle. It is provided that trie goods and vehicle seized on 24-8-2009 be provisionally released provided the petitioner furnishes bonds as demanded by the department and only one FDR of Rs. 50,000/-. The rest of the conditions imposed under the impugned orders stand modified to the extent stated above.
Subject to above, the writ petition succeeds and allowed in part.