DHARAMPAL PREMCHAND LTD vs. COMMISSIONER OF CENTRAL EXCISE

CEAC/20/2011HC DelhiDLHC01067198201112 August 2011Author: HON'BLE MR. JUSTICE A.K.SIKRI,HON'BLE MR. JUSTICE M.L. MEHTA23 pages
AI SummaryDismissed

What were the facts?

The appellant, Dharampal Premchand Ltd., engaged in manufacturing scented chewing tobacco and related products, has a registered office in Delhi but a manufacturing unit in Barotiwala, Himachal Pradesh. The respondent, Commissioner of Central Excise, issued show cause notices to the Himachal Pradesh unit proposing demands for short-paid National Calamity Contingent Duty (NCCD) for periods between April 2002 and October 2002, along with interest and penalty. The Deputy Commissioner, Shimla, confirmed the demand. The appellant appealed to the Commissioner (Appeals), Chandigarh, who allowed the appeal. The Commissioner of Central Excise, Chandigarh, appealed to the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Principal Bench, New Delhi, which set aside the Commissioner (Appeals)'s order and restored the Deputy Commissioner's order. The appellant then filed these appeals before the Delhi High Court under Section 35G of the Central Excise Act, 1944.

What did the High Court hold?

The High Court held that it lacks territorial jurisdiction to entertain the appeals. The Court reasoned that while the CESTAT's principal bench is in New Delhi, the territorial jurisdiction for statutory appeals under Section 35G of the Central Excise Act, 1944, is determined by the location where the cause of action arises and where the original adjudication took place. The Court applied the principles laid down in M/s. Sterling Agro Industries Ltd. vs. Union of India & Ors. and Vrindavan Beverages Pvt. Ltd. vs. CCE, Meerut, which emphasized that the situs of the Tribunal does not determine the High Court's jurisdiction for statutory appeals. The Court found that allowing appeals in a High Court other than where the cause of action arose would lead to forum shopping and judicial anarchy, as decisions would only have persuasive value outside their territorial jurisdiction. The preliminary objection raised by the revenue regarding territorial jurisdiction was accepted. The Court did not decide on the merits of the case.

What were the issues?

1. Whether the Delhi High Court has territorial jurisdiction to entertain appeals filed under Section 35G of the Central Excise Act, 1944, when the manufacturing unit and the cause of action arose in Himachal Pradesh, despite the CESTAT having its principal bench in New Delhi? (Question of law) Assessee's contentions: Mr. Pritesh Kapur argued that statutory appeals under Section 35G are governed by specific provisions that demonstrate the maintainability of the appeal in the Delhi High Court. He contended that the judgment in M/s. Sterling Agro Industries Ltd. dealt with writ petitions under Article 226 and not statutory appeals. Revenue's contentions: Mr. Mukesh Anand argued that the Delhi High Court lacks territorial jurisdiction because the appellant's unit is in Himachal Pradesh, the dispute arose in Himachal Pradesh, and the initial action was initiated by the Central Excise authorities in Shimla. He relied on the judgment in M/s. Sterling Agro Industries Ltd. vs. Union of India & Ors. (decided on 01.08.2011) to support his submission.

Which sections of the Income-tax Act were involved?

Section 35G,Section 11A,Section 11AB,Section 25

AI-generated summary — verify with the full judgment below

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

+ RESERVED ON: AUGUST 03, 2011 %

PRONOUNCED ON:AUGUST 12,2011

+ DHARAMPAL PREMCHAND LTD. . . . APPELLANT

through : Mr. Pritesh Kapur, Advocate.

VERSUS

COMMISSIONER OF CENTRAL EXCISE . . .RESPONDENT

through: Mr. Mukesh Anand, Advocate with Mr. R.C.S. Bhadoria, Advocates.

+ DHARAMPAL PREMCHAND LTD. . . . APPELLANT

through : Mr. Pritesh Kapur, Advocate.

VERSUS

COMMISSIONER OF CENTRAL EXCISE . . .RESPONDENT

through: Mr. Mukesh Anand, Advocate with Mr. R.C.S. Bhadoria, Advocates.

CORAM :-

HON’BLE MR. JUSTICE A.K. SIKRI

HON’BLE MR. JUSTICE M.L. MEHTA

1.

Whether Reporters of Local newspapers may be allowed to see the Judgment?

2.

To be referred to the Reporter or not?

3.

Whether the Judgment should be reported in the Digest?

The order continues below.

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