Back
2003 Supreme(Cal) 548
High Court Of Calcutta
Kalyan Jyoti Sengupta
SHIV KUMAR JAIN - Appellant
Versus
UNION OF INDIA - Respondent
Writ Petition 1282 Of 2003
Decided On : 11/11/2003
A.K.CHOUDHARY, JAYANTA BANERJEE
The Government cannot deprive a person of the enjoyment of his property without due recourse to law and withholding of the amount refunded beyond a reasonable time is violative of Article 300A of the Constitution.
Headnote:
INTEREST ON REFUNDED AMOUNT - EXCISE - SECTION 35F - No statutory right for claiming interest on the amount refunded - Interest allowed on the amount refunded from the date of expiry of reasonable time for refund till the date of payment of principal amount.
Fact of the Case:
The petitioner had deposited a certain amount as penalty and duty. On appeal, the CEGAT set aside the order and allowed the refund of 50% of the amount deposited. The CEGAT's order was not challenged and the principal amount was refunded after about one and half years. The petitioner claimed interest for the period during which the amount was withheld.
Finding of the Court:
The court held that the time taken for refund of the money in terms of the CEGAT's order was unreasonable and that the withholding of the amount after 31st December, 2001 was an negligent inaction on the part of the Government, violative of Article 300A of the Constitution.
Issues: Whether the petitioner is entitled to interest on the amount refunded.
Ratio Decidendi: The court relied on the judgment of the Madras High Court in Commissioner of C. Ex. Chennai v. Calcutta Chemical Co. Limited, wherein it was held that interest can be allowed on the amount refunded in case of delay in refund.
Final Decision: The court directed the respondents to pay interest at the rate of 8% on the amount of Rs. 10 lacs from January 2002 till 3rd April, 2003.
( 1 ) THIS petition has been filed being aggrieved with the decision of the appropriate department refusing to pay interest for the amount earlier deposited and thereafter refunded in terms of the order of the CEGAT. It is an admitted position that this writ petition is not based on any statutory right, but the question of negligence on the part of the department concerned. It is settled position of the law that negligence on part of the State may be due to failure to discharge constitutional obligation or simple statutory one. The power of this Court is there to grant appropriate relief without asking the litigants to go to the Civil Court but not in all cases, but in the cases where there is no dispute as regard facts, invoking of writ jurisdiction is not inappropriate. Here the fact is required to be narrated in brief. By the first authority the petitioner was asked to pay penalty and the other duty which he did. Thereafter he took up this matter in appeal to the CEGAT. Ultimately the CEGAT vide its order dated 21st June, 2001 set aside the order and allowed the refund of the amount deposited to the extent of 50%.
( 2 ) THIS CEGAT's judgment and order containing direction for refund were not taken up to the higher forum as yet rather this order has been accepted by refunding a sum of Rs. 10 lacs on 3rd April, 2003. After having received the aforesaid principal amount the writ petitioner claimed for payment of interest because of withholding payment despite the direction of the CEGAT for about one and half years. Mr. Chowdhury appearing for the petitioner submits in support of the petition that this amount should have been refunded within a reasonable time and not having done so the respondent department has utilised the money and the petitioner has been deprived of enjoyment and utilisation thereof for no fault. In support of his submission he has relied on a Division Bench Judgment of the Madras High Court reported in 2001. (133) E. L. T. 278 in case of Commissioner of C. Ex. Chennai v. Calcutta Chemical Co. Limited, whereby the interest has been allowed at the rate of 15% per annum. Mr. Jayanta Banerjee, learned Advocate appearing with Ms. Jayshree Chakraborty, learned Advocate while opposing the writ petition contends that the petitioner does not have any statutory right for claiming any interest and such claim on interest have been rejected by the department concerned. In absence of any statutory provision the order of payment of interest on the amount refunded is unheard of. He further submits that there are many hassles and procedure in the department for effecting final refund. The Government cannot act so promptly or diligently as a private individual does. The argument of Mr. Banerjee is apparently convincing, however, in the affidavit-in-opppsition nothing has been said nor has been explained as to why so much of time was taken. It is not explained either in the affidavit as to any departmental procedure is to be adhered to for release of the amount.
( 3 ) THEREFORE, I am unable to accept the argument of Mr. Banerjee in absence of these particulars and explanation in the affidavit that there were reasons for delayed refund of the amount.
( 4 ) IN my view, the time taken for refund of the money in terms of the CEGAT's order is unreasonable. CEGAT's order was passed on 21st June, 2001 so one could expect either the matter to be taken to higher up, and for this, under law ninety days time is given and on expiry of this time the department was expected to refund this money, since it is a Government Department. So, unlike the ordinary citizen another three months of grace time may be given for taking action. So, the department should have released this amount within the reasonable time of six months, namely by 31st December, 2001. Unfortunately this has not been done. So, I think after expiry of 31st December, 2001 the Government has no justification for withholding this money, and I hold
