KOKJE, J. - (1.) THE petitioner is a Company incorporated under the Indian Companies Act, 1956. THE petitioner Company has a unit at Bhilwara wherein Man Made Fabrics are manufactured/processed. THE petitioner had taken on lease the land, the building and the Plant and Machinery of the process house owned by M/s. Suzuki Textile Ltd. , Bhilwara. THEy also entered into a job contract with M/s. Suzuki Textiles Ltd. THE non petitioners granted a Registration Certificate to the petitioner under Rule 174 of the Central Excise Rules, 1944. THE petitioner started processing of Fabrics on 3. 06. 1997 and had been regularly submitting price declaration and monthly returns to the Range Superintendent, Central Excise showing a regular payment of excise duty on the Fabrics processed by it from time to time and such payments were accepted.
(2.) THE petitioner's premises were raided by the Anti Evasion Party of Central Excise Department, Jaipur on 19th and 20. 01. 98 and on 19th and 20. 02. 98. Certain documents, and books of accounts were seized. By the Finance Act 1977 Section 3-A was introduced in the Central Excise Act, 1944 empowering the Central Govt. to charge excise duty on the basis of capacity of production in respect of certain goods. Rules were made by the Central Govt. for determination of annual capacity of production of the specified goods notified under Sub Section (1) of Section 3-A of the Act. The goods were specified by another notification under sub-secton (a) of Section 3a of the Act. The Central Govt. also specified the rate of excise duty on textile fabrics, falling under certain headings of the schedule to the Central Excise Tariff Act, 1985, manufactured or produced by an independent processor with the aid of a hot-air stenter vide notification No. 36/98 dated 10. 12. 98. The petitioner claiming itself to be an independent processor claimed benefit under the aforesaid notification and claimed that it was chargeable to duty under Section 3-A and not under Section 3 of the Act. On 30. 12. 98 Additional Commissioner wrote to the petitioner in response to the declaration given by it on 16. 12. 98 that the process house for which the declaration was made was owned by M/s Suzuki Textiles Ltd. , a company having proprietary interests in weaving of fabrics also and till the matter was decided the request of the petitioner for determination of the annual production in their favour under the Scheme cannot be entertained. Upon this, the petitioner filed D. B. Civil Writ Petition No. 11/99 in this Court challenging the aforesaid direction. On 22. 4. 99 that petition was allowed and letter dated 30. 12. 98 of the Additional Commissioner and the letter dated 30. 12. 98 issued by the Supdt. Central Excise were quashed. It was held by this Court that the respondents cannot contend that the petitioner company was not an independent manufacturer or independent processor without first revoking or suspending the Registration Certificate under Rule 174 of the Central Excise Rules granted to the petitioner. The Commissioner of Central Excise, the respondent No. 2, issued a show cause notice on 31. 5. 99 to the petitioner and called upon it to show cause as to why the petitioner should not be denied the status of an independent processor as defined in the Notification No. 36/98 CE (NT) and No. 42/98 CE (NT) both dated 10. 12. 98 in view of the allegations made in the show cause notice dated 15. 1. 99. After receiving the first show cause notice dated 15. 1. 99 during the pendency of earlier petition itself the petitioner had moved applications dated 18. 2. 99, 25. 2. 99, 8. 3. 99, 12. 3. 99, 27. 3. 99, 3. 4. 99, and 16. 4. 99 for obtaining copies of the documents mentioned in Annex. 2 of the show cause notice dated 15. 1. 99 as those documents were being relied upon by the department for taking the action proposed in the said show cause notice. The respondents did not allow the request of supply of copies but instead were prepared to give an opportunity to examine the records and obtain photo copies of the same. After some correspondence and after receiving some of the copies required but not all, the petitioner filed this petition praying for quashing of the show cause notice dated 15. 1. 99 and 31. 5. 99, restraining the respondent No. 1 from proceeding further with the show cause notice dated 15. 1. 99 and 31. 5. 99, for a declaration that the Registration Certificate issued to the petitioner is not liable to be revoked and/or suspended and for a declaration that the petitioner company was an independent processor within the meaning of notifications 36/98 and 42/98 both dated 10. 12. 98. In the alternative it was also prayed that respondent No. 1 be directed to furnish authenticated copies of the documents mentioned in the letter dated 19. 6. 99 and on which reliance has been placed in the impugned notices and the respondents may be restrained from proceeding against the petitioner in pursuance of the impugned show cause notices dated 15. 1. 99 and 31. 5. 99 without supplying the copies demanded by the petitioner in the letter dated 19. 6. 99. The respondents vehemently opposed the petition on various grounds. On 24. 6. 99 a Division Bench of this Court stayed further proceeding in pursuance to impugned notices dated 15. 1. 99 and 31. 5. 99. It was however directed that the respondents were at liberty to proceed in pursuance to the said notices if they furnish the authenticated copies of the documents mentioned in Annex. 2 of the show cause notice dated 15. 1. 99 to the petitioner. The petition was ultimately heard finally with the consent of the parties. At the hearing the petitioner pressed only one prayer, that of supply of the copies of the documents. The grounds of challenge to the show cause notice were not pursued and the arguments were confined to only necessity of furnishing authenticated copies of the documents relied upon by the respondents in support of the show cause notice as listed in Schedule-2 of the show cause notice dated 15. 1. 99.
(3.) THE learned counsel for the petitioner submitted that non supply of documents relied upon by the respondents in support of the show cause notice would be a serious violation of principles of natural justice. Relying on the decision of the Supreme Court in Sahi Ram vs. Avtar Singh and others (1), the learned counsel submitted that a show cause notice must set out all the factual material and should be accompanied by copies of all documents relied upon by the State Govt. in support of the show cause notice. Single Bench decisions of the Karnataka High Court in Reletronics Ltd. vs. Union of India (2) and of Rajasthan High Court in Roshan Lal Agarwal vs. Union of India (3) were also relied on. The learned counsel for the respondents raised a serious objection to the maintainability of the petition as the petition challenges an action at the show cause notice stage itself. It was submitted that the petitioner should not be allowed to jump the departmental hierarchy set up by the Act and should wait for the decision of the Excise Authorities and then file departmental appeals, after disposal of which only, the petition could be filed and entertained. It was also submitted that when the respondents had shown their readiness to permit the petitioner to inspect the documents and take photo copies of the relevant documents, no grievance could be made by the petitioner and the petition should not be entertained on that court also. ;