1990 PLP 752 (CLC)

‑‑‑‑8. 5‑‑Notification No. SRO 913 (1)/75 dated 21‑8‑1975‑‑Constitution of Pakistan (1973), Art.199‑‑‑Penalty, refund of‑‑‑Customs Department assessed production capacity of petitioner mill at 22,800 tons per annum ‑‑‑Assessee was also made liable to pay additional amount of duty at rates specified therein under R. 5 (3) of said Rules‑‑‑Rule 5(3) was substituted through notification dated 21‑8‑1975 whereby newly framed sub‑rules (3) & (4) were added which provided payment of penalty instead of calling it as additional duty‑‑‑Petitioner challenged levy of penalty and applied for refund of amount which amount was paid as penalty‑‑‑Collector, Central Excise, recommended to Central Board of Revenue for refund of amount but his recommendation had not been accepted by Central Board of Revenue although there existed no justifiable reason for Central Board of Revenue, to refuse recommendation regarding refund of amount of penalty‑‑ Case was remanded to Board of Revenue with direction to dispose of recommendation in accordance with law. Mushtaq Memon for Petitioner. Zaheer Khan for Respondents. Date of hearing 15th August, 1989. AJMAL MIAN, CJ.‑‑The petitioner had set up a sugar mill at Shahpur Jahanian, Taluka Moro, District Nawabshah which went into production in November, 1971. It seems that in 1972 the Central Excise & Land Customs Department assessed the production capacity of the petitioner at 22,800 tons per annum which was challenged in Const. Petition No. 463/1975, which petition was withdrawn on 18‑10‑1977.1t appears that under Rule 5 (1) of the Excise Duty on Production Capacity (Sugar) Rules, 1972, hereinafter referred to as the 'Rules', the Excise Duty was payable in 8 equal instalments, which Rule was amended, whereby the payment was provided in 12 monthly instalments of the Excise Duty on the assessed amount of the Excise Duty per annum. It further seems that under sub‑Rule (3) of Rule 5 in case of delay in payment of the Excise Duty in terms of above sub‑Rule (1) of rule 5, the. assessee was liable to pay additional amount of duty at the rates specified therein. The above sub‑Rule (3) of Rule 5 of the Rules was substituted through a Notification No. SRO 913 (1) 75 dated 21‑8‑1975, whereby newly framed sub‑Rules (3) and (4) were added, which provided the payment of penalty instead of calling it as Additional Duty. The petitioner, filed the above petition challenging the levy of the above amount of penalty. It is the case of the petitioner that by the time they filed the above petition, they had paid a sum of Rs.23,408 under the above sub‑Rules (3) & (4). The respondent Deptt had also raised a further demand for a sum of Rs.21,90,160.40 up to the period expiring on 31‑10‑1975 on account of the above penal amount. It appears that respondent No.2, i.e. the Central Board of Revenue by its letter dated 14‑4‑1977, addressed to the All Pakistan Textile Mills Association (Annexure `P‑1') at page 95 of the petition rile, accorded waiver of the Additional duty on two conditions, namely, the arrears of the Excise Duty were to be cleared by 30th June, 1977 which date was extended up to 30th November, 1977 and secondly the assessee should give explanation for the default. Upon the petitioner's letter, respondent No.3, i.e. the Collector Central Excise & Land Customs, Hyderabad, by his letter dated 8‑11‑1977 clarified that the above concession was applicable to all the excise payers and not only to the textile mill onwers. It is the case of the petitioner that in terms of the above Central Board of Revenue letter dated 14‑4‑1977 they cleared the entire arrears A of the Excise Duty upto the above date and also gave plausible explanation for the delay in the payment of the Excise Duty. It is further the case of the petitioner that upon their application for the refund of the amount of Rs.2,73,856/54, which amount was paid by them as penalty, above respondent No.3 recommended to a respondent No.2 for the refund of the above amount. The above recommendation has not yet been accepted by the respondent No.2 without any justifiable reasons. It may be observed that the petition was amended after filing the amendment application after the issuance of the above letter dated 14‑4‑1977. In the present circumstances of the case in our view it would be just and proper to remand the case to respondent No.2 with the direction to dispose of respondent No.3's recommendation in accordance with law within a period of 3 (three) months from the date of the receipt of the copy of this order. The petition stands disposed of with no order as to costs. M.Y.H./A‑666/K Case remanded