AMARESHWAR SAHAY, J. - (1.) HEARD learned Counsel for the parties.
(2.) IN this writ application, the petitioner has sought to challenge the show - cause notice dated 3.11.2006, issued by the Commissioner of Central Excise and Service Tax, Jamshedpur whereby and whereunder, the petitioner has been asked to show -cause within 30 days as to why - (a) the duty amounting to Rs. 3,36,15,065.34 (Rupees Three Crores Thirty Six Lakhs Fifteen Thousand Sixty Five and Paise 34 only) be not demanded and recovered from the petitioner in terms of proviso to Section 11A of the Central Excise Act, 1944; (b) penalty be not imposed on him under the provisions of Section 11AC of the Central Excise Act, 1944 read with Rule 25 of the Central Excise Rules; (c) interest on delayed payment of duty in respect of amount of Rs. 3,36,15,065.34 be not demanded and recovered from him in terms of Section 11AB of the Central Excise Act, 1944. In the said notice to show -cause, it has been alleged that the petitioner - Company cleared spare parts of machine like side dumper loader (S.D.L.) manufactured by the petitioner without payment of Excise Duty during the period from October, 2001 to August, 2006 in the garb of trading activity. The petitioner has been charged for contravening provisions of Section 4 of the Central Excise Act, 1944 read with Rule 51 -A of the Central Excise Rules, 1944 and Rules 8, 10, 11, 12 and 16 of the Central Excise Rules, 2001. It has also been alleged that the petitioner did not seek any permission from the competent authority nor submitted any intimation to the Department for trading activities as required under the Law during the said period and thereby, the Excise Duty amounting to Rs. 3,36,15,065.34 along with interest and penalty becomes recoverable from the petitioner. By the said notice to show -cause, the petitioner has been given liberty to take help of legal representative and he has also been allowed to produce all evidence upon which, he relied In defence of his case.
(3.) ACCORDING to the petitioner, the impugned notice to show -cause was issued on the basis of Rule 51 -A of the erstwhile Central Excise Rules as stood earlier which has now been superceded with effect from 1st July, 2001 after introduction of the Central Excise Rules, 2001. Earlier permission was required to be obtained from the Central Excise Authority for the duty paid goods to enter or retain in part in the premises or factory. According to the petitioner, Rule 51 -A of the erstwhile Central Excise Rule. 1944 was not in force when such notice to show -cause was issued, but in spite of that on those allegations of contravention of said Rules which was not in force, the notice to show -cause was issued. Therefore, the show -cause notice proceeded upon in an incorrect and illegal basis. Therefore, the same is liable to be quashed.;