Union of India &
Ors. Vs. M/S Green Alloys P. Ltd.  INSC 850 (28 April 2009)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURI SDICTION CIVIL APPEAL NO. 2894 OF 2009 (Arising
out of SLP (C) No. 30427 of 2008) Union of India & Ors. ..Appellants Versus
M/s. Green Alloys P. Ltd. ..Respondent
Dr. ARIJIT PASAYAT,
in this appeal is to the order passed by a Division Bench of the Punjab and
Haryana High Court directing release of the goods seized from the respondent on
furnishing undertaking to pay the duty or other dues which may be found due
without furnishing any cash security or bank guarantee for the value of the
goods. Certain other directions were given which we are not primarily concerned
with. By the Writ Petition (CWP No. 17287 of 2008) the respondent had sought
for a direction for release of raw material seized by the Anti Evasion Branch
of the Central Excise, Faridabad on 15.9.2008 and also to quash letter of
seizure on 24.9.2008 alongwith Panchnama.
of the present respondents was that under the Cenvat Credit Rules, 2004, only
the finished goods are excisable and there could be no evasion of duty unless
the goods are manufactured and cleared. Condition of executing Bond in form
B-11 or giving of cash security for releasing the goods was not justified. Bond
B-11 was applicable for release of finished goods only.
the reply filed on behalf of the present appellant stand taken is that the
present respondent had shown low value addition and paid very less amount of
duty from the cash account. The imported scrap was of the value of Rs.70-80 per
kg. while finished goods were of the value of Rs.120-130 per kg. They also
found that against the declared stock of 453326 kg. aluminium scrap entered in
the stock RG-23A Pt-I register, the balance shown was nil. In the table
reproduced in para 3 of the written statement, it is mentioned that though
there was entry of goods received in register RG- 23A, in the register
maintained in computer in Excel Sheet, the entry of 7.9.2008 and 8.9.2008 was
nil. It is thus pointed out that under Rule 15 of the Cenvat Credit Rules,
2004, the goods were liable to confiscation and penalty."
the High Court observed that it was not expressing any opinion on the merits
yet it went into various aspects and ultimately the direction was given which
is impugned in the present appeal.
counsel for the appellants submitted that the approach of the High Court is
counsel for the respondent on the other hand submitted that the order of the
High Court does not suffer from any infirmity.
counsel for the respondent submitted that in a similar case this Court had
declined to interfere in SLP (C) No. 30354 of 2008 by order dated 5.1.2009. The
order reads as follows:
granting liberty to the petitioners to issue additional show cause notice, the
special leave petition is dismissed."
is pointed out by learned counsel for the appellant that in the instant case
two show-cause notices have been issued. We find that while passing an interim
order the High Court had given certain categorical findings on merits. It has
held that it cannot be held that there was a clear case for confiscation only
on the ground that in the computerised excel sheet some of the goods were not
High Court appears to have decided that aspect finally even though that was not
the stage for doing so and that was beyond the scope for adjudication of the
writ petition. In the circumstances we direct that the respondent shall be
permitted to release goods on furnishing cash security or bank guarantee for
25% of the value of goods. The same shall be done within a period of four
weeks. The appeal is allowed to the aforesaid extent.
(Dr. ARIJIT PASAYAT)