- (1.) The petitioner, a Limited Company has filed the present petition under Articles 226/227 of the Constitution of India for a writ of mandamus directing respondent Nos. 1 and 2 to levy only countervailing duty on its products and to refund Rs.87,02,460/- together with interest at the rate of 18% P.A.which has been collected by the State of Karnataka as excise duty on the liquor manufactured by it.
(2.) Brief facts as narrated in the petition may be noticed. The petitioner is a limited company registered under the Companies Act, 1956 (in short, "the Act"). It is engaged in the business of manufacture and sale of liquor. It has license to sell liquor in the State of Punjab in Form L-1 issued by respondent No.2. The petitioner imported liquor from its distillery at Bangalore in the State of Karnataka to its depot in Jalandhar for the period from 1.4.1990 to 31.3.1991. The State of Punjab has collected excise duty of Rs.1,12,70,774.82 from the petitioner. The petitioner has paid Rs.87,02,460/- towards excise duty to the State of Karnataka. According to the petitioner, the State of Punjab was entitled to collect the countervailing duty of Rs.25,68,314.82 and the amount paid by it as excise duty in the State where manufacture had taken place i.e. the State of Karnataka is required to be refunded to it. The request of the petitioner for refund of the amount having been declined, it has filed the present writ petition.
(3.) The averments of the petitioner have been controverted by the respondents by filing written statement. It has been stated that the petitioner was granted permission to sell liquor in the State of Punjab for consumption after approval of their labels which bore a declaration that "Duty not paid to Karnataka State" and "for sale in the State of Punjab only". Further, it has been pointed out that in case the petitioner is aggrieved by the provisions of the Karnataka Excise Act, it may approach the concerned State for remedial action. Para 6 of the written statement reads thus:- "6. That the petitioner has rightly paid countervailing duty to the State of Punjab on the liquors imported into the State for consumption within the State of Punjab under the provisions of Punjab Excise Act, 1914, which are based on the cardinal principle "duty follows Consumption" and provide similar rate of countervailing Duty as of the Excise Duty on the goods produced within the State meant for consumption within State. The petitioner has reproduced the provisions of Karnataka Excise Act, which are not relevant so far as the countervailing duty chargeable in the State of Punjab is referable to the provisions of the Punjab Excise Act, 1914. If any provision of the Karnataka Excise Act, providing the levy of duty on the goods not meant for sale or consumption in that State, is harsh or bad in law, the petitioner could challenge that provision. The petitioner was allowed to import the liquors into the State of Punjab after approval of their labels under the provision of Punjab Excise Act, which bore a declaration "duty not paid to Karnataka State" and "for sale in the State of Punjab only". The duty was, therefore, rightly paid in the State of Punjab and any claim of refund of duty at this stage is illegal and unwarranted.";