O.N.G.C. Ltd Vs. Commnr. of Customs, Mumbai  Insc 783 (1 August 2007)
Sinha & Markandey Katju
O R D
E R I.A. NO. 4 IN CIVIL APPEAL NO. 1882 OF 2004 S.B. SINHA, J:
is a public sector undertaking wholly owned and controlled by the Central
Government. It obtained the services of M/s. SEDCO Forex Int. Drilling Inc. for
obtaining requisite information which would assist it in the matter of
exploration of oil and gas. The information so gathered was recorded in 3-D
Seismic Tapes. On the amount paid therefor, custom duty was sought to be
levied. An exemption was claimed by the appellant from payment of custom duty
in terms of an exemption notification issued by the Central Government in that
behalf. As despite such claim, assessment proceedings were initiated and
completed, the matter came upto this Court and by a judgment and order dated
24.08.2006, contention of the appellant was accepted by this Court and the
orders of assessment were set aside.
pendancy of the Civil Appeals before this Court, a sum of Rs. 54,72,87,536.00
was realised by way of custom duties and interest thereon, etc. as per the
14.09.2004 Rs. 25,00,00,000.00 adjusted towards duty
30.03.2004 Rs. 17,72,87,536.00 appropriated towards interest
24.02.2005 Rs. 12,00,00,000.00 adjusted towards interest Total Rs.
54,72,87,536.00 An application has now been filed for a direction to the
respondent to pay interest on the said sum with effect from the date of
recovery till the date of the appellant.
Ganesh, learned senior counsel appearing on behalf of the Appellant, would
submit that keeping in view the fact that the appellant had to deposit a huge
amount during pendency of the Civil Appeals, interest of justice would be met
if this Court directs the respondent to pay interest at the rate of 12% per
annum on the said amount. It was submitted that interest should be directed to
be paid by way of restitution, as has been held by this Court in South Eastern
Coalfields Ltd. v. State of M.P. and Others [(2003) 8 SCC 648].
Dutta, learned senior counsel appearing on behalf of the respondent, on the
other hand, would submit that the Central Government did not make any
investment of the amount received by it by way of indirect tax but expended the
same for the welfare of the people and, thus, no interest should be directed to
be paid in the instant case.
is a public sector undertaking. Respondent is the Central Government. We agree
that in principle as also in equity the appellant is entitled to interest on
the amount deposited on application of principle of restitution. In the facts
and circumstances of this case and particularly having regard to the fact that
the amount paid by the appellant has already been refunded, we direct that the
amount deposited by the appellant shall carry interest at the rate of 6% per
annum. Reference in this connection may be made to Pure Helium India (P) Ltd.
v. Oil & Natural Gas Commission, (2003) 8 SCC 593 and Mcdermott
International Inc. v. Burn Standard Co. Ltd. & Ors. 2006 (6) SCALE 220.
therefore, is directed to pay a sum of Rs. 9,51,21,999.50/- by way of interest.
Such amount should be paid within a period of six weeks from date. The
application is disposed of accordingly.