1

W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

“C.R.”

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT

THE HONOURABLE MR. JUSTICE HARISANKAR V. MENON

WEDNESDAY, THE 12

TH

DAY OF FEBRUARY 2025 / 23RD MAGHA, 1946

WP(C) NO.11633 OF 2019

PETITIONER:

APOLLO TYRES LIMITED,

HAVING ITS REGISTERED OFFICE AT 3RD FLOOR,

AREEKAL MANSION, NEAR MANORAMA JUNCTION,

PANAMPILLY NAGAR, KOCHI -682 036, REPRESENTED

BY ITS GROUP MANAGER – TAXATION MS.POOJA SHARMA

BY ADVS.

JOSEPH KODIANTHARA (SR.)

SRI.V.ABRAHAM MARKOS

SRI.ABRAHAM JOSEPH MARKOS

SRI.ISAAC THOMAS

SRI.P.G.CHANDAPILLAI ABRAHAM

SHRI.VIPIN ANTO H.M.

SHRI.ALEXANDER JOSEPH MARKOS

SHRI.SHARAD JOSEPH KODANTHARA

RESPONDENTS:

1 THE COMMISSIONER OF CENTRAL TAXES AND CENTRAL EXCISE

CENTRAL REVENUE BUILDING, I.S. PRESS ROAD,

COCHIN - 682 018.

2 THE JOINT COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE CENTRAL REVENUE BUILDING, I.S. PRESS ROAD,

COCHIN - 682 018.

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W.P(C) No.11633 of 2019

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3 THE DEPUTY COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE, CENTRAL EXCISE BHAVAN, KATHRIKADAVU, KALOOR,

COCHIN - 682 017.

4 THE ASSISTANT COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE, KAKKANAD DIVISION, CENTRAL EXCISE BHAVAN,

KATHRIKADAVU, KALOOR, COCHIN - 682 017.

5 THE SUPERINTENDENT OF CENTRAL TAX AND CENTRAL EXCISE

KAKKANAD I RANGE, CENTRAL EXCISE BHAVAN, KATHRIKADAVU,

KALOOR, COCHIN - 682 017.

BY SRI.SREELAL N. WARRIER

THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 05.02.2025,

ALONG WITH WP(C).11717/2019, 16115/2019, THE COURT ON 12.02.2025

DELIVERED THE FOLLOWING:

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT

THE HONOURABLE MR. JUSTICE HARISANKAR V. MENON

WEDNESDAY, THE 12

TH

DAY OF FEBRUARY 2025 / 23RD MAGHA, 1946

WP(C) NO.11717 OF 2019

PETITIONER:

APOLLO TYRES LIMITED,

HAVING ITS REGISTERED OFFICE AT 3RD FLOOR,

AREEKAL MANSION, NEAR MANORAMA JUNCTION,

PANAMPILLY NAGAR, KOCHI - 682 036, REPRESENTED

BY ITS GROUP MANAGER - TAXATION MS.POOJA SHARMA

BY ADVS.

JOSEPH KODIANTHARA (SR.)

SRI.V.ABRAHAM MARKOS

SRI.ABRAHAM JOSEPH MARKOS

SRI.ISAAC THOMAS

SRI.P.G.CHANDAPILLAI ABRAHAM

SHRI.VIPIN ANTO H.M.

SHRI.ALEXANDER JOSEPH MARKOS

SHRI.SHARAD JOSEPH KODANTHARA

RESPONDENTS:

1 THE COMMISSIONER OF CENTRAL TAXES AND CENTRAL EXCISE,

CENTRAL REVENUE BUILDING, I.S PRESS ROAD,

COCHIN - 682 018.

2 THE JOINT COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE, CENTRAL REVENUE BUILDING, I.S PRESS ROAD,

COCHIN - 682 018.

3 THE ADDITIONAL COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE, CENTRAL REVENUE BUILDING, I.S PRESS ROAD,

COCHIN - 682 018.

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

4 THE ASSISTANT COMMISSIONER OF CENTRAL TAX AND CENTRAL

EXCISE, CENTRAL EXCISE BHAVAN, KATHRIKADAVU, KALOOR,

COCHIN - 682 017.

5 THE SUPERINTENDENT OF CENTRAL TAX AND EXCISE,

KAKKANAD I RANGE, CENTRAL EXCISE BHAVAN,

KATHRIKADAVU, KALOOR, COCHIN - 682 017.

BY SRI.SREELAL N.WARRIER

THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 05.02.2025,

ALONG WITH WP(C).11633/2019 AND CONNECTED CASES, THE COURT ON

12.12.2025 DELIVERED THE FOLLOWING:

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT

THE HONOURABLE MR. JUSTICE HARISANKAR V. MENON

WEDNESDAY, THE 12

TH

DAY OF FEBRUARY 2025 / 23RD MAGHA, 1946

WP(C) NO.16115 OF 2019

PETITIONER:

PRINCE TMT STEELS PVT. LTD.,

REGISTERED OFFICE AT 6/439, ANAPPURAMKADU,

KINASSERY.P.O., PALAKKAD -678701, REPRESENTED

BY ITS MANAGING DIRECTOR, MR.T.K.ABDUL KARIM.

BY ADVS.

M.S. SAJEEV KUMAR

A.N.JYOTHILEKSHMI(K/109/2006)

LAKSHMI S KUMAR(K/000098/2017)

RESPONDENTS:

1 THE COMMISSIONER OF CENTRAL GST AND CENTRAL EXCISE,

CALICUT COMMISSIONERATE, C.R.BUILDING, MANANCHIRA,

KOZHIKODE-673001. (EARLIER COMMISSIONER OF CENTRAL

EXCISE, CUSTOMS AND SERVICE TAX).

2 THE ADDITIONAL COMMISSIONER OF CENTRAL GST

AND CENTRAL EXCISE, OFFICE OF THE COMMISSIONER OF

CENTRAL TAX AND CENTRAL EXCISE, CALICUT COMMISSIONERATE,

C.R.BUILDING, MANANCHIRA, CALICUT -673001.

3 THE SUPERINTENDENT (ADJ) OF THE CENTRAL GST AND CENTRAL

EXCISE, OFFICE OF THE COMMISSIONER, CENTRAL GST AND

CENTRAL EXCISE, C.R.BUILDING, MANANCHIRA,

KOZHIKODE-673001.

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

BY SRI.P.R.SREEJITH, SC, CENTRAL BOARD OF EXCISE AND

CUSTOMS

THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 05.02.2025,

ALONG WITH WP(C).11633/2019 AND CONNECTED CASES, THE COURT ON

12.12.2025 DELIVERED THE FOLLOWING:

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

JUDGMENT

[WP(C) Nos.11633/2019, 11717/2019 and 16115/2019]

These three writ petitions essentially seek to challenge the

show cause notices issued by the Assessing Authority under the

Central Excise Act, 1944 (for short, the ‘Act’) on the ground of

limitation.

2. The short facts as culled out from W.P(C)No.16115 of

2019 are as under:

The petitioner is stated to be engaged in the manufacture

of MS/TMT Bars and Rods, out of MS Ingots. It is on the final

products like MS/TMT Rods and Bars that excise duty is exigible.

They contend that Ext.P1 show cause notice dated 28.04.2015

was issued by the 1

st

respondent noticing the consumption of

raw materials during the years 2010-11 onwards and the actual

production carried out. The notice states, with reference to the

raw materials used and the actual production, that the output

was only 91.74% of the raw materials. It further states that as

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

per the norms fixed by M/s.Steel Authority of India Ltd. (for

short, ‘SAIL’) the output should be 95%. With reference to the

afore, the notice states that there was a short production of

6698.703 MT and the said quantity ought to be assessed to

duty. The petitioner states that it submitted Ext.P2 reply to the

1

st

respondent herein seeking a copy of the audit report of

CERA, referred to in the show cause notice, a copy of

input/output norms fixed by SAIL, copy of the statutory

authority which adopts the norms fixed by SAIL to be observed

by companies like the petitioner. Ext.P3 is stated to be issued

thereafter for the period from December 2014 to October 2015

on the very same basis. Though the petitioner states that it sent

various communications seeking the documents already sought,

Ext.P9 notice was issued for the period from November 2015 to

June 2017, repeating the same allegations. It is stated that the

petitioners are served with Ext.P14 letter dated 06.06.2019

from the 3

rd

respondent herein enclosing the copy of the tender

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

instructions of SAIL as the evidence for the input-output norms

as also the observation of CERA.

3. It is in the afore circumstances that the captioned writ

petition is filed challenging Exts.P1, P3 and P9 notices on the

ground that they are time-barred under Section 11A(11) of the

Act, apart from contending that the very basis of the initiation

of adjudication steps was flawed.

4. W.P(C) No.11633 of 2019 and 11717 of 2019 are filed

by another company engaged in the manufacture of Pneumatic

Tyres challenging show cause notices issued during 2009 and

2012, respectively, on the ground of limitation under Section

11A (11) of the Act.

5. I have heard Sri.Aravind P. Datar, the learned senior

counsel instructed by Sri. Sajeev Kumar the learned counsel for

the petitioner in W.P(C) No.16115 of 2019 and Sri.Joseph

Kodianthara, the learned senior counsel for the petitioner in the

other two cases. I have also heard Sri.Sreelal N. Warrier, the

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

learned counsel for the respondents in W.P(C) Nos.11717 and

11633 of 2019 and Sri.P.R.Sreejith, the learned counsel for the

respondents in W.P(C)No.16115 of 2019.

6. Sri.Datar, the learned senior counsel, would contend

that:

i. The show cause notices were issued against the

petitioner solely on the basis of the audit of the

petitioner's records by CERA, which in turn relied on

some “norms” fixed by the SAIL. The afore details

were not provided to the petitioner originally, and it

is only pursuant to Ext.P14 dated 06.06.2019 that

they have been served on the petitioner.

ii. The details so served in 2019, cannot be the basis for

assuming jurisdiction over the petitioner under the

provisions of the Central Excise Act.

iii. Unless and until the statutory basis for the adoption

of the so-called norms fixed by SAIL is made known

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

by the respondent, no adjudication is possible against

the petitioner.

iv. He relied on the provisions of Section 3A of the Act to

contend that the insistence of a particular output to

be maintained by the manufacturer can only be with

reference to the afore provision and no adjudication

on the basis of the norms fixed by SAIL is possible.

v. In the light of the afore, he contends that the very

basis for issuance of the notices was flawed and

hence, the show cause notices are to be set aside.

vi. He relied on the provisions of Section 11A(11) of the

Act to contend that the show cause notices may be

quashed in view of the period of limitation prescribed

therein.

vii. He relied on various orders of CESTAT in support of

the afore contention.

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

7. Sri.Kodianthara, the learned senior counsel, would

contend that:

i. The show cause notices challenged in

W.P(C)No.11633 of 2019 were issued during

2009/2010/2011, and insofar as the period

prescribed under Section 11A(11) of the Act is over,

there cannot be any further proceedings against the

petitioner. As regards W.P(C) No.11717 of 2019, the

show cause notices were issued from 2008 to 2018

and the adjudication cannot be carried out for the

very same reasons.

ii. He would rely on the judgment of the Gujarat High

Court in Siddhi Vinayak Syntex Pvt. Ltd. v. Union

of India [2017 (352) E.L.T 455 (Guj.)] and that

of the Bombay High Court in W.P(C) No.3671 of

2021.

8. Sri.Sreelal N. Warrier, the learned counsel, would

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W.P(C) No.11633 of 2019

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contend that:

i. The show cause notices were issued on the basis

of the observation on audit and there is no

irregularity.

ii. The fact that the notices were kept in the call book

does not attract the provisions of Section 11A(11).

9. Sri.P.R.Sreejith, the learned counsel for the

respondents, apart from adopting the submissions made by

Sri.Sreelal N. Warrier, would contend that:

i. The petitioners are challenging the show cause

notices alone. Therefore, no writ petition can be filed

against the show cause notices and it is for the

petitioner to file replies to the said notices.

ii. He would point out that the reliance placed on the

norms fixed by SAIL cannot be found fault with, when

those details have been provided to the petitioner.

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

10. I have considered the rival submissions and the

connected records.

11. The following issues arise for consideration in these

writ petitions.

i. Can the petitioners challenge the show cause notices

in a writ petition filed under Article 226 of the

Constitution of India?

ii. Can the adjudicating authority initiate proceedings

solely on the basis of the “norms” fixed by SAIL as

seen from the show cause notices challenged in

W.P(C) No.16115 of 2019?

iii. Are the impugned show cause notices barred by

limitation under Section 11A (11) of the Act?

12. The first issue arising for consideration, as noticed

above, is with reference to the maintainability of the writ

petitions so far as they seek to challenge the show cause notices

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

issued under the Act. It is settled principle that as against show

cause notices, it is the duty of the assessee to file objections to

the proposals contained therein. The learned Standing Counsel

for the respondents would rely on a series of judgments of the

Apex Court as well as various High Courts including this Court,

in support of the afore contention.

13. In the case at hand, the petitioners essentially

contend that the notices issued are barred by limitation under

Section 11A(11) of the Act. As regards the question of

limitation, there cannot be any dispute that a writ petition is

maintainable against show cause notices which have been

issued beyond the period prescribed by the statute. Similarly,

a writ petition against show cause notices on the basis of the

admitted facts can also be challenged under Article 226 of the

Constitution of India. Here, as already noticed, the show cause

notices have been issued on the basis of the norms fixed by the

SAIL. The question as to whether there can be an adjudication

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

on the basis of such alleged “norms” without statutory backing,

strikes at the very root of the assessment proceedings, even

questioning the jurisdiction of the adjudicating authority. This

Court notices that the petitioners have sought to quash the

show cause notices both on the ground of the limitation as well

as on the ground of the jurisdiction of the adjudicating authority.

Therefore, a writ petition at the show cause stage is

maintainable as held by the Apex Court in Union of India and

Others v. Coastal Container Transport Association and

Others [(2019) 20 SCC 446] .

14. In the light of the afore, I am of the opinion that the

petitioners are justified in challenging the show cause notices

through the afore writ petitions.

15. The second issue arising for consideration is the

power of the adjudicating authority to rely “on the norms fixed

by SAIL”. The show cause notices have been issued with

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

reference to the provisions of Section 11A(1) and (4) of the Act,

which reads as under:

“(1) Where any duty of excise has not been levied or paid or has

been short-levied or short-paid or erroneously refunded, for any

reason, other than the reason of fraud or collusion or any wilful

mis-statement or suppression of facts or contravention of any of

the provisions of this Act or of the rules made thereunder with

intent to evade payment of duty.

........

(4) Where any duty of excise has not been levied or paid or has been short-

levied short-paid or erroneously refunded, by the reason of-

(a) fraud; or

(b) collusion; or

(c) any wilful mis-statement; or

(d) suppression of facts; or

(e) contravention of any of the provisions of this Act or

of the rules made thereunder with intent to evade

payment of duty,

by any person chargeable with the duty, the Central Excise

Officer shall, within five years from the relevant date, serve

notice on such person requiring him to show cause why he

should not pay the amount specified in the notice along with

interest payable thereon under section 11AA and a penalty

equivalent to the duty specified in the notice.”

True, the statute empowers the adjudicating authority to

proceed against the assessee in situations where the duty of

excise has been “short-levied” or “short-paid”.

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and con.cases 2025:KER:10904

16. A reading of the show cause notices challenged in

W.P(C) No.16115 of 2019 would show that the petitioner therein

was engaged in the manufacture of MS Bars/TMT Bars from

Billets/Ingots and the ratio of such manufacture in comparison

to raw materials was 91.74%. The show cause notices proceed

on the basis of the audit of the petitioner’s records in

comparison with the norms fixed by SAIL. The show cause

notice alleges that SAIL has fixed such ratio of production of MS

Bars/TMT Bars at 95% of the consumption. It is with reference

to the afore that the show cause notices allege suppressed

production to the extent of the difference between the afore

percentages. Here, this Court notices that the difference

noticed is hardly 3.26%.

17. The norms of SAIL have also been forwarded to the

petitioner along with Ext.P14 letter dated 06.06.2019. A

reading of the document attached along with the afore letter

would show that the same applies only as against those

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W.P(C) No.11633 of 2019

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manufacturers agreeing to act as “conversion agents” for SAIL.

It is as against such work of conversion being entrusted by SAIL

to private manufacturers, norms have been fixed by SAIL to the

effect that even though the raw materials are supplied by SAIL,

they would tolerate wastage to the extent of 5% alone. That

does not mean that there cannot be more than 5% wastage. It

is only that as regards the job works entrusted by SAIL pursuant

to the afore tender, SAIL would tolerate wastage to the extent

of 5% alone. Apart from this, there is no statutory backing for

such adoption of the conversion ratio fixed by SAIL for

adjudication purposes. The liability to excise duty under the

provisions of the Act is with reference to the provisions of

Section 3 on the “production/manufacture” within the country.

In the case at hand, apart from making reference to the norms

fixed by the SAIL, no reasons are seen mentioned under the

show cause notices.

18. In State of Rajasthan and Another v. Rajasthan

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W.P(C) No.11633 of 2019

and con.cases 2025:KER:10904

Chemists Assn. [(2006) 6 SCC 773] , the Apex Court

considered the question as to whether a “notional value” can be

the basis for taxation than the “actual value” with reference to

the provisions of Section 4A of the Rajasthan Sales Tax Act,

1994. Considering the afore issue, the Apex Court found as

under:

“50. ……..By substituting the assumed quantity of goods or a price

which is not the subject-matter of that contract of completed sale

for the purpose of measuring tax, the legislature assumes

existence of contract of sale of drugs by legal fiction which has not

taken place and which cannot be considered to be a sale in the

manner stated in the Sales Act, which alone can be the subject of

tax under Entry 54 in List II. Substitution of assumed price or the

assumed quantity in place of actual price/quantity in a completed

sale transaction, for the purpose of levy of tax on the subject-

matter of tax results in taking away from it the character of “sale

of goods” as envisaged under the Sales Act.

53. By devising a methodology in the matter of levy of tax on sale

of goods, law prohibits taxing of a transaction which is not a

completed sale and also confines sale of goods to mean sale as

defined under the Act. This cannot be overridden by devising a

measure of tax which relates to an event which has not come into

existence when tax is ex hypothesi determined, much less which

can be said to be a completed sale and which cannot be the subject

of legislation providing tax on “sale of goods” by transplanting a

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W.P(C) No.11633 of 2019

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sum related to as “likely price” to be charged for subsequent sale

to be taxed by the devise of measuring tax for the completed

transaction which has become subject of tax.”

The afore principles would apply to the case at hand also, insofar

as the show cause notices have been issued by notionally

refixing the quantity manufactured by the petitioner which

attracts duty under the Act, by deviating from the procedure

prescribed under the statute.

19. Again, a Division Bench of this Court in U.K.Monu

Timbers (M/s.) v. State of Kerala [2012 (3) KHC 111

(DB)], was called upon to consider the legality of the steps

taken for refixing the output tax liability by adopting certain

price for the commodity fixed by certain Circulars for a different

purpose. Considering the issue, this Court found as under:

“20. The value so prescribed by the Commissioner, as

contended by the Government Pleader, might have been

after taking into consideration the market conditions and

also after holding discussions with the dealers'

association. This, however, does not create a prohibition

insofar as the dealers are concerned to sell the goods at

a rate in variance with the rates so prescribed. The actual

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sale price may be lesser or greater than that prescribed

by the circular. When it is lesser, the dealer definitely gets

a right to claim a refund of the tax paid in advance, but

however, subject to any incriminating material as to

under - valuation detected and established by the

assessing authority. When the price is higher, it goes

without saying that the tax liability also gets increased

and the dealer is obliged to pay the amounts in excess of

that paid as advance, at the time of filing of returns as

prescribed by the Act. The circular is only for the purpose

of collecting tax in advance and cannot be considered as

an unassailable document of universal application with

respect to the price at which the goods are to be sold.

There can be no other interpretation possible and the

second question raised by us is also answered against the

Revenue and in favour of the assessee.

21. In the instant case, there were no discrepancies in

the books of accounts, the stock found on inspection and

the other documents indicating the sale of goods within

the State...”

The case at hand also seeks only to refix the quantity

manufactured, which attracts an excise duty, without

suggesting any discrepancy in the petitioner's returns/books of

accounts.

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20. Another Division Bench of this Court in U.Manikandan

v. Assistant Commissioner of State Tax, State GST

Department and Ors.[MANU/KE/2522/2020] considered a

case where a dealer in “day-old chicks” sold at a particular price

was sought to be proceeded against on the basis of the higher

price at which a Government Agency sold the very same

commodity. This Court noticing the fallacy in adopting the price

fixed by the PSU for the purpose of assessment of an individual

assessee found as under:

“14. The grounds raised against rejection of returns and

consequential best judgment, were rejected by the Assessing

Officer on the finding that the assessee had not proved the same,

i.e.: the distinctive nature of the same goods based on the source,

the quality, the expense incurred on procurement or production,

the end consumer and so on and so forth. In this context we have

to emphasize that the assessee's books of accounts were not found

to be doctored in any manner. The sale price as asserted by the

assessee was available from their invoices and there was no

material detected that the assessee had in fact made sales for

higher prices than that disclosed in the invoices. It was the

Assessing Officer on the basis of the Audit Report and the details

of the sale price available from KEPCO, who sought to reject the

returns and the books of accounts. The assessee has the initial

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burden to prove that the returns filed are in accordance with the

provisions of the tax enactment and the books of accounts kept

truly and correctly in the course of business. The Assessing Officer

having not found anything to discredit the returns filed by the

assessee or the books of accounts maintained, and relied on the

turnover of another dealer that too a PSU, who incidentally also has

the same business, to resort to a best judgment assessment. The

onus shifts to the Assessing Officer, to prove that the operations

carried on by the two dealers are similar and identical. The mere

fact that both are dealing in the same product cannot lead to any

irrefutable conclusion that the sale price would be the same.

16…………We garner support from Gujarat Ambuja Cements Ltd to

find that the proceedings itself is an abuse of process of law for

reason of the Assessing Officer having rejected the books of

accounts merely on the ground that a PSU sells day-old chicks at a

price higher than that of the assessee. The estimation made is on

the basis of the books of accounts of the PSU and there was no

defect, omission or suppression detected from the books of

accounts maintained by the assessee. We find that the rejection of

books of accounts of the assessee was not justified and the basis

adopted, being the sale price of another dealer, that too a PSU, has

no reasonable nexus with the estimation made. We hence set aside

the assessment only to the extent the additions were made based

on the sale price of day-old chicks of KEPCO, on the particular facts

of this case.”

The afore principles laid down by this Court would show that the

show cause notices issued solely on the basis of the so-called

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“norms” fixed by SAIL were without any justification.

21. As already noticed, a reading of the show cause

notices do not disclose any discrepancy regarding the

petitioner's books of accounts and other records. In such

circumstances, I am of the opinion that the initiation of the

adjudication steps under the provisions of the Act in the case at

hand was without any justification. This Court also notices the

provision under Section 3A of the Act providing for fixation of

the annual capacity of a unit engaged in manufacturing process.

The respondents have no case that any such determination has

been carried out in the case at hand.

22. The last issue arising for consideration, which is

common for all three writ petitions is regarding the application

of the provisions of Section 11A(11) of the Act. The show cause

notices regarding W.P(C) No.11633 of 2019 were issued prior to

2011. The show cause notice regarding W.P(C) No.11717 of

2019, Ext.P3(a) was issued in 2008. In W.P(C) No.1 6115 of

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2019, objections were also filed to the show cause notice(s).

However, in none of these cases, final adjudication under the

statute has taken place.

23. In this connection, provisions of Section 11A(11)

assume significance and the same provides as under:

“(11) The Central Excise Officer shall determine the amount

of duty of excise under sub-section (10).

(a) within six months from the date of notice where it is

possible to do so, in respect of cases falling under sub-

section (1);

(b) within two years from the date of notice, where it is

possible to do so, in respect of cases falling under sub-

section (4)”

The afore provision requires the adjudicating authority to

determine the amount of excise duty payable within a period of

“six months” as regards show cause notices issued under

Section 11A(1). As regards the cases where show cause notices

are issued under Section 11A(4), the statute requires

finalization of proceedings within “2 years”. In the cases at

hand, the show cause notices have been issued under Section

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11A(4). The statute requires the final determination to be

carried out within the period prescribed therein. True, as rightly

contended by the learned counsel for the respondents, the

statute visualizes such final determination “where it is possible

to do so.” However, that does not mean that the revenue can

keep the matters pending indefinitely. Furthermore, no plausible

explanations have been provided for the delay in finalization of

the proceedings as above.

24. In this connection, I notice the judgment in Siddhi

Vinayak Syntex (supra). In the said case, the Gujarat High

Court considered the question as regards the proposed

adjudication of show cause notices after inordinate delay, which

will actually amount to the revival of the proceedings after a

long gap without disclosing any valid reason for the delay.

Considering the said issue, after making reference to the

provisions of Section 11A(11), a Division Bench of the Gujarat

High Court has found as under:

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“24. Thus, with effect from the year 2011 a time limit has

been prescribed for determining the amount of duty of

excise where it is possible. It cannot be gainsaid that when

the legislature prescribes a time limit, it is incumbent upon

the authority to abide by the same. While it is true that the

legislature has provided for such abiding by the time limit

where it is possible to do so, sub-section (11) of Section

11A of the Act gives an indication as to the legislative

intent, namely that as far as may be possible the amount

of duty should be determined within the above time frame,

viz. six months from the date of the notice in respect of

cases falling under sub-section (1) and one year from the

date of the notice in respect of cases falling under sub-

section (4) or sub-section (5) When the legislature has

used the expression "where it is possible to do so", it means

that if in the ordinary course it is possible to determine the

amount of duty within the specified time frame, it should

be so done. The legislature has wisely not prescribed a time

limit and has specified such time limit where it is possible

to do so, for the reason that the adjudicating authority for

several reasons may not be in a position to decide the

matter within the specified time frame, namely, a large

number of witnesses may have to be examined, the record

of the case may be very bulky, huge workload, non -

availability of an officer, etc. which are genuine reasons for

not being able to determine the amount of duty within the

stipulated time frame. However, when a matter is

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consigned to the call book and kept in cold storage for years

together, it is not on account of it not being possible for the

authority to decide the case, but on grounds which are

extraneous to the proceedings. In the opinion of this Court,

when the legislature in its wisdom has prescribed a

particular time limit, the C.B.E. & C. has no power or

authority to extend such time limit for years on end merely

to await a decision in another case. The adjudicatory

authority is required to decide each case as it comes,

unless restrained by an order of a higher forum. This Court

is of the view that the concept of call book created by the

C.B.E. & C.. which provides for transferring pending cases

to the call book, is contrary to the statutory mandate,

namely, that the adjudicating authority is required to

determine the duty within the time frame specified by the

legislature as far as possible. Moreover, as discussed

hereinabove, there is no power vested in the C.B.E. & C. to

issue such instructions under any statutory provision,

inasmuch as, neither Section 37B of the Central Excise Act

nor Rule 31 of the rules, envisage issuance of such

directions. The concept of call book is, therefore, contrary

to the provisions of the Central Excise Act and such

instructions are beyond the scope of the authority of the

C.B.E. & C. Transferring matters to the call book being

contrary to the provisions of law, the explanation put forth

by the respondents for the delay in concluding the

proceedings pursuant to the show cause notice 3-8-1998

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cannot be said to be a plausible explanation for not

adjudicating upon the show cause notice within a

reasonable time. In view of the settled legal position, as

propounded by various High Courts, with which this Court

is in full agreement, the revival of proceedings after a long

gap of ten to fifteen years without disclosing any reason for

the delay, would be unlawful and arbitrary and would vitiate

the entire proceedings.”

Thus, the court found that the expression “where it is possible

to do so” does not clothe the Department to sleep over the

adjudication proceedings indefinitely. Though the afore

judgment is challenged by the revenue before the Apex Court

by filing SLP(C) No.18214 of 2017, notice has been issued only

to a limited extent as regards certain circulars issued alone.

Thus, the other findings of the Gujarat High Court have become

final. This Court also notices that even in cases where no period

of limitation is prescribed for exercising a power, the Apex Court

in State of Punjab v. Bhatinda District Cooperative Milk

Producers Union Ltd. [(2007) 11 SCC 363] has held that

the action has to be taken within a reasonable period of time.

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When the afore principles are applied to the facts of the present

case, I notice that the adjudication is not finalized within a

reasonable period of time and hence, the proceedings cannot be

permitted to be continued any further. The judgment of the

Gujarat High Court has been followed by the Punjab and

Haryana High Court also in Shree Baba Exports v.

Commissioner [2022 (381) E.L.T 53(P & H)] and GPI

Textiles Limited v. Union of India [2018 (362) E.L.T

388(P & H).

25. On the whole, I am of the opinion that the impugned

notices are not to be sustained on account of the limitation

prescribed under Section 11A (11) of the Act.

26. This Court also notices the judgment of the Apex Court

in Babu Verghese and Others v. Bar Council of Kerala and

Others [(1999) 3 SCC 422] following the judgment in Taylor

v. Taylor [(1875) 1 Ch.D. 426] holding that when a statute

requires a thing to be done in a particular manner, the

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authorities are duty bound to follow that course. Therefore, the

time limit prescribed under Section 11A(11) ought to have been

followed mandatorily and so far as that is not done, the

impugned show cause notices are only to be quashed.

On the whole, I am of the opinion that the petitioners are

entitled to succeed. Hence, these writ petitions would stand

allowed by quashing Exts.P1(a) to P1(c) in W.P(C) No.11633 of

2019, Exts.P1, P3 and P9 in W.P(C) No.16115 of 2019 and

Exts.P3(a) to P3(j) in W.P(C) No.11717 of 2019.

Sd/-

HARISANKAR V. MENON, JUDGE

ln

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APPENDIX OF WP(C) 11717/2019

PETITIONER’S EXHIBITS:

EXHIBIT P1 TRUE COPY OF BOARD CIRCULAR NO.1065/4/2018 -CX

DATED 08/06/2018

EXHIBIT P2 TRUE COPY OF FINAL ORDER NO. 10374 -10375/2019

DATED 25/02/2019 PASSED BY THE HONOURABLE

CESTAT, AHMEDABAD IN THE CASE OF SANGHI

INDUSTRIES LTD. V.C.C.E, KUTCH (GANDHIDHAM)

EXHIBIT P3(a) TRUE COPY OF SHOW CAUSE NOTICE NO.54/2008 -CE

DATED 05/09/2008 ISSUED TO THE PETITIONER

EXHIBIT P3(b) TRUE COPY OF SHOW CAUSE NOTICE NO.24/2010 -CE

DATED 08/04/2010 ISSUED TO THE PETITIONER

EXHIBIT P3(c) TRUE COPY OF SHOW CAUSE NOTICE NO. 07/2011 -CE

DATED 01/02/2011 ISSUED TO THE PETITIONER

EXHIBIT P3(d) TRUE COPY OF SHOW CAUSE NOTICE NO.02/2012 -CE

DATED 02/02/2012 ISSUED TO THE PETITIONER

EXHIBIT P3(e) TRUE COPY OF SHOW CAUSE NOTICE NO.22/2012 -EC

DATED 17/12/2012 ISSUED TO THE PETITIONER

EXHIBIT P3(f) TRUE COPY OF SHOW CAUSE NOTICE NO.60/2013 -EC

DATED 28/08/2013 ISSUED TO THE PETITIONER

EXHIBIT P3(g) TRUE COPY OF SHOW CAUSE NOTICE NO.10/2014-CE

DATED 03/09/2014 ISSUED TO THE PETITIONER

EXHIBIT P3(h) TRUE COPY OF SHOW CAUSE NOTICE NO.61/2015 -CE

DATED 07/09/2015 ISSUED TO THE PETITIONER

EXHIBIT P3(i) TRUE COPY OF SHOW CAUSE NOTICE NO.02/2018 -CE

DATED 19/01/2016 ISSUED TO THE PETITIONER

EXHIBIT P3(j) TRUE COPY OF SHOW CAUSE NOTICE NO.02/2018 -CE

DATED 19/01/2018 ISSUED TO THE PETITIONER

EXHIBIT P4(a) TRUE COPY OF REPLY DATED 27/09 2008 FILED BY

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THE PETITIONER TO EXHIBIT P3(A) SHOW CAUSE

NOTICE NO.54/2008-CE

EXHIBIT P4(b) TRUE COPY OF REPLY DATED 24/05/2010 FILED BY

THE PETITIONER TO EXHIBIT P3(B) SHOW CAUSE

NOTICE NO.24/2010-CE

EXHIBIT P4(c) TRUE COPY OF REPLY DATED 09/2/2011 FILED BY

THE PETITIONER TO EXHIBIT P3(C) SHOW CAUSE

NOTICE NO.07/2011-CE

EXHIBIT P4(d) TRUE COPY OF REPLY DATED 05/04/2012 FILED BY

THE PETITIONER TO EXHIBIT P3(D) SHOW CAUSE

NOTICE NO.02/2012-CE

EXHIBIT P4(e) TRUE COPY OF REPLY DATED 30/12/2012 FILED BY

THE PETITIONER TO EXHIBIT P3(E) SHOW CAUSE

NOTICE NO.22//2012-CE

EXHIBIT P4(f) TRUE COPY OF REPLY DATED 30/9/2013 FILED BY

THE PETITIONER TO EXHIBIT P3(F) SHOW CAUSE

NOTICE NO.60/2013-CE

EXHIBIT P4(g) TRUE COPY OF REPLY DATED 30/09/2013 FILED BY

THE PETITIONER TO EXHIBIT P3(G) SHOW CAUSE

NOTICE NO.10/2014-CE

EXHIBIT P4(h) TRUE COPY OF REPLY DATED 08/10/2015 FILED BY

THE PETITIONER TO EXHIBIT P3(H) SHOW CAUSE

NOTICE NO.61/2015-CE

EXHIBIT P4(i) TRUE COPY OF REPLY DATED 22/02/2018 FILED BY

THE PETITIONER TO EXHIBIT P3(J) SHOW CAUSE

NOTICE NO.02/2018-CE

EXHIBIT P4(j) TRUE COPY OF REPLY DATED 22/02/2018 FILED BY

THE PETITIONER TO EXHIBIT P3(J) SHOW CAUSE

NOTICE NO.61/2015-CE.

EXHIBIT P5 TRUE COPY OF ORDER DATED 28/07/2017 IN

S.L.P.(C) NO.18214 OF 2017 PASSED BY THE

HONOURABLE SUPREME COURT REPORTED IN 2018

(362)E.L.T. A122(SC)

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EXHIBIT P6 TRUE COPY OF JUDGMENT DATED 10/01/2019 PASSED

BY THE HONOURABLE GUJARAT HIGH COURT IN

SPECIAL CIVIL APPLICATION NO. 16157/2018

FILED BY THE PETITIONER.

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APPENDIX OF WP(C) 16115/2019

PETITIONER’S EXHIBITS:

EXHIBIT P1 TRUE COPY OF THE SHOW CAUSE NOTICE

NO.34/2015-CE (C.NO.V/72/15/27/2015 ADJ.)

DATED 28.4.2015 ALONG WITH ANNEXURES A & B

ISSUED BY THE 1ST RESPONDENT.

EXHIBIT P2 TRUE COPY OF LETTER DATED 9.7.2015 ISSUED BY

THE PETITIONER TO THE 1ST RESPONDENT.

EXHIBIT P3 TRUE COPY OF SHOW CAUSE NOTICE NO.84/2015 CE

DATED 29.12.2015 (C.NO.V/72/15/88/2015

C.EX.ADJ/5723) ISSUED BY THE 1ST RESPONDENT

TO THE PETITIONER.

EXHIBIT P4 TRUE COPY OF LETTER DATED 7.1.2016 ISSUED BY

THE PETITIONER TO THE 1ST RESPONDENT.

EXHIBIT P5 TRUE COPY OF NOTICE DATED 22.11.2016

(C.NO.V/72/15/27/2015 CX. ADJ/875) ISSUED BY

THE 3RD RESPONDENT TO THE PETITIONER.

EXHIBIT P6 TRUE COPY OF LETTER DATED 29.11.2016 ISSUED

BY THE PETITIONER'S ADVOCATE TO THE 1ST

RESPONDENT.

EXHIBIT P7 TRUE COPY OF NOTICE DATED 9.2.2017

(C.NO.V/72/15/27/2015 CX.ADJ./555) ISSUED BY

THE 3RD RESPONDENT TO THE PETITIONER.

EXHIBIT P8 TRUE COPY OF LETTER DATED 16.2.2017 ISSUED BY

THE PETITIONER'S ADVOCATE TO THE 1ST

RESPONDENT.

EXHIBIT P9 TRUE COPY OF SHOW CAUSE NOTICE NO.18/2017 -18-

CE DATED 6.11.2017 (C.NO.V/31/15/09/2017

C.EX.-ADJ./803) ISSUED BY THE 2ND RESPONDENT

TO THE PETITIONER.

EXHIBIT P10 TRUE COPY OF NOTICE DATED 21.2.2019

(C.NO.V/72/15/88/2015 C.EX. ADJ./451) ISSUED

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BY THE RESPONDENT TO THE PETITIONER.

EXHIBIT P11 TRUE COPY OF LETTER DATED 2.3.2019 SENT BY

THE PETITIONER TO THE 3RD RESPONDENT.

EXHIBIT P12 TRUE COPY OF NOTICE DATED 19.3.2019 ISSUED BY

THE 3RD RESPONDENT TO THE PETITIONER.

EXHIBIT P13 TRUE COPY OF RECORD OF PERSONAL HEARING DATED

4.4.2019 ISSUED BY THE 1ST RESPONDENT.

EXHIBIT P14 TRUE COPY OF NOTICE DATED 6.6.2019

(C.NO.V/72/15/27/2015 CX. ADJ./1199) ISSUED

BY THE 3RD RESPONDENT TO THE PETITIONER ALONG

WITH ENCLOSURES.

EXHIBIT P15 TRUE COPY OF JUDGMENT OF THE DIVISION BENCH

OF THE GUJARAT HIGH COURT IN THE CASE OF

M/S.SIDDHI VINAYAK SYNTEX PRIVATE LIMITED

VS.UNION OF INDIA AND OTHERS REPORTED IN 2017

(352) ELT 455 (GUJ.)

EXHIBIT P16 TRUE COPY OF ORDER DATED 28.7.2017 IN

S.L.P.(C)NO.18214 OF 2017 PASSED BY THE

HONOURABLE SUPREME COURT.

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APPENDIX OF WP(C) 11633/2019

PETITIONER’S EXHIBITS:

:

EXHIBIT P1 A TRUE COPY OF SHOW CAUSE NOTICE NO. 14/2009

CENTRAL EXCISE DATED 05/03/2009 ISSUED TO THE

PETITIONER.

EXHIBIT P1 B TRUE COPY OF SHOW CAUSE NOTICE NO 19/2009

DATED 23/11/2009 ISSUED TO THE PETITIONER

EXHIBIT P1 C TRUE COPY OF SHOW CAUSE NOTICE NO.10/2011 -CE

DATED 01/06/2011 ISSUED TO THE PETITIONER

EXHIBIT P2 A TRUE COPY OF REPLY DATED 22/08/2009 FILED BY

THE PETITIONER TO EXHIBIT P1(A)

EXHIBIT P2 B TRUE COPY OF REPLY DATED 18/01/2010 FILED BY

THE PETITIONER TO EXHIBIT P1(B)

EXHIBIT P2 C TRUE COPY OF REPLY DATED 24/08/2011 FILED BY

THE PETITIONER TO EXHIBIT P1(C)

EXHIBIT P3 TRUE COPY OF NOTICE OF PERSONAL HEARING DATED

18/08/2011 ISSUED ON BEHALF OF THE ASSISTANT

COMMISSIONER OF CENTRAL EXCISE TO THE

PETITIONER

EXHIBIT P4 TRUE COPY OF ORDER DATED 28/07/2017 IN

S.L.P(C)NO.18214 OF 2017 PASSED BY THE APEX

COURT REPORTED IN 2018(362) E.L.T.A122(SC)

EXHIBIT P5 TRUE COPY OF JUDGMENT DATED 10/.1/2019 PASSED

OF THE HONOURABLE GUJARAT HIGH COURT IN

SPECIAL CIVIL APPLICATION NO.16157/2018 FILED

BY THE PETITIONER