Commissioner Central CGST And Cx Haldia Commissionerate And Ors vs. Haldia Petrochemicals LTD And Ors

Held

The Court held that the service of the adjudication order dated October 17, 2012, was not validly effected. Section 37C(1)(a) of the Central Excise Act, 1944, as amended, contemplates four methods of service, including by speed post with proof of delivery. Sub-section (2) of Section 37C mandates that proof of delivery is a condition for establishing proper service. The revenue failed to place any record before the writ court to show that the order was delivered, i.e., there was no proof of delivery. Therefore, the direction issued by the learned writ court to quash the bank account attachment and direct refund was justified. The Court found that the revenue's interest was sufficiently safeguarded as Rs. 4.75 crores remained with the department, and the writ petitioner had also made the mandatory pre-deposit for appeal. The appeal was dismissed, and the amount lying with the department was to abide by the orders of the learned tribunal.

Facts

The appeal was filed by the Commissioner, Central CGST and CX, Haldia Commissionerate (revenue) against an order of the High Court dated June 30, 2022. The respondent, Haldia Petrochemicals Limited (writ petitioner), had filed a writ petition seeking cancellation of letters dated February 17, 2022, and June 18, 2014, and a direction to provide a copy of the order in original dated October 17, 2012. The writ petitioner's case was that the adjudication order dated October 17, 2012, was not served, making subsequent bank account attachments and recovery notices from 2014 invalid. The revenue had filed an affidavit-in-opposition with the adjudication order. The writ court had quashed the bank account attachment and directed refund of recovered sums. The revenue had refunded amounts but retained approximately Rs. 4.75 crores.

Key Issues

1. Whether the service of the adjudication order dated October 17, 2012, was validly effected on the writ petitioner as per Section 37C of the Central Excise Act, 1944, and the rules thereunder? The petitioner argued that the order was not served, rendering subsequent recovery actions invalid. The revenue contended that the order was dispatched via speed post. 2. Whether the writ court's direction to quash the bank account attachment and direct refund was justified, considering the revenue's interest? The petitioner argued for the refund of amounts recovered. The revenue argued that its interest was safeguarded by the retention of Rs. 4.75 crores and the mandatory pre-deposit made by the petitioner for appeal.