- (1.) MESSRS Hindustan Lever Limited, Bombay, applicant, have filed Civil Misc. No. 992 of 1986 under Order 1, Rule 10, read with Section 151 Civil Procedure Code, for being impleaded as a respondent or intervener in the writ petition (No. 3120 of 1985 - Oswal Oil and Soap Industries and Anr. v. The Custom Excise and Gold Control Appellate Tribunal and Ors.) pending in this Court.
(2.) 'messrs Oswal Oil and Soap Industries Proprietors Oswal Agro Mills Ltd. and another have filed Civil Writ Petition No. 3120 of 1985 against respondents, seeking inter alia the issuance of a writ of mandamus, directing respondents 3 and 4 to forthwith carry out the orders passed by respondent Nos. 1 and 2 and refund the petitioners a sum of Rs. 1,31,04,811. 89 paid by them as duty and a writ of certiorari quashing show cause notice dated 10th February, 1985 as well as the orders dated 10th May, 1985, passed by the Assistant Collector. The petitioners have pleaded in the writ petition that petitioner No. 1 among other things carries on the trade and business activities of manufacture of soap and oils. The petitioner No. 1 had filed a classification list under Rule 173b of the Central Excise Rules, 1944, effective from 25th September, 1980, seeking the classification of hydrogenated rice bran oil (HRBO) under Central Excise Tariff Item No. 12 which inter alia covers vegetable non-essential oils of all sorts and no Excise duty is payable on them. The Assistant Collector, Central Excise (ACE), Ludhiana, vide his order dated 3rd February, 1981, held that HRBO fell under Tariff Item No. 68 which attracted 8% to 10% duty at the relevant time. Consequently, the petitioner paid excise duty on HRBO manufactured by them. The Collector (Appeals) allowed the appeal filed by the petitioners mainly-relying on the decisions of the Central Excise and Gold Control Appellate Tribunal (for short 'the Tribunal') which is the apex adjudicatory authority under the Central Excise and Salt Act held that HRBO manufactured by the petitioners would fall under Tariff Item No. 12 and not Tariff Item No. 68. He set aside the order dated 3rd February, 1981, passed by ACE, Ludhiana, and directed that HRBO manufactured by the appellant should be classified under Item No. 12. Despite repeated requests of the petitioners, the departmental authority did not refund the Excise duty paid by the petitioner on HRBO. ACE issued a show cause notice dated 10th February, 1985, to petitioner No. 1 stating that grounds of refund had been examined along with other evidence and he tentatively held that refund was not admissible for the reasons grounds mentioned in the show cause notice. The Revenue filed an appeal before the Tribunal and also moved an application seeking stay of the operation of the impugned order passed by the Collector (Appeals ). The Tribunal vide order dated 11th April, 1985, rejected the application for stay filed by the Revenue. The appeal is still pending before the Tribunal. That ACE has vide orders dated 10th May, 1985 turned down the request of the petitioners for refund of excise duty paid by them. They have filed Civil Writ Petition No. 3120 of 1983.
(3.) THE applicant has averred in its application that Messrs Oswal Oil and Soap Industries (for short 'the writ petitioner') was engaged in the manufacture of Hydrogenated Rice Bran Oil (for short HRBO'); that the writ petitioner cleared the HRBO manufactured by it on payment of excise duty as the Excise Authorities were of the view that HRBO is classifiable under Tariff Item No. 68 of the First Schedule of the Central Excise and Salt Act (hereinafter referred to as 'the Act'); and not under Tariff Item No. 12 during the relevant period. That the writ petitioner recovered from the applicant a sum of Rs. 80,29,038. 90 as Excise duty in respect of sale of HRBO to the applicant-Bombay Factory and Rs. 18,42,000/- approximately in respect of sale of HRBO to the applicant-Calcutta Factory. This happened during the period of October, 1980 to July, 1983. The applicant used the HRBO purchased by it from the writ-petitioner as a raw material for manufacturing soap. The Central Government vide notification No. 201/79= CE dated 4th June, 1979, framed an exemption Scheme, whereunder the duty paid on HRBO, which was used as raw material in the manufacture of soap was refunded by allowing a proforma credit to the manufacture of finished goods/products. In view of the notification referred to above, the applicant availed of refund of tune of Rs. 98,71,000/- by way of credit against the clearance of finished goods viz. soap while paying duty thereon. The net payment of excise duty to the Department on account of the clearance of the said HRBO was, therefore, nil. The incidence of the Excise duty on the writ-petitioner was also nil as it had got full refund/reimbursement of the duty from the applicant. That the question whether HRBO falls under Tariff Item No. 68 or Tariff Item No. 12 is pending consideration of the Appellate Tribunal, New-Delhi, as well as the Supreme Court of India. In case it is ultimately held by the Supreme Court of India that HRBO falls under Item No. 68 and not under Item No. 12, the writ petition will be liable to be dismissed on this ground alone. It was further pleaded that in the writ petition a prayer has been made for the refund of Rs. 1,31,04,811. 89 paid as Excise duty on HRBO which has already been collected by the writ-petitioner from the applicant and other purchasers of HRBO during the relevant period. The applicant and other purchasers had, thereafter obtained refund of excise duty by way of proforma credit from the Department while paying the Excise duty on finished goods manufactured by them. It is contended that a notice had been issued by the Range Superintendent Central Excise, Bombay, to the applicant on January 14, 1986, for reversing the credit availed earlier and paying back a sum of Rs. 80,29,038. 90 paise in respect of purchase of HRBO by the factory at Bombay. A copy of the notice had been attached as Annexure 'a'. It is stated that if the writ petition is allowed, the applicant will be seriously affected and gravely prejudiced as it might have to pay a sum of over Rs. 80 lakhs to the Department under the aforesaid notice Annexure 'a'. In case the applicant is not impleaded as a respondent or allowed to intervene, it will result in unnecessary multiplication of litigation. It was contended that the applicant will place before the Court certain relevant and material facts which had been withheld by the writ-petitioner in the writ petition.;