The Bombay High Court dismissed the plea challenging penalty provision of the Pan Masala Rules under section 3A the Central Excise Act.
The petitioner, Amit Pramod Minache is engaged in the activity of cultivation of land in Ichalkaranji, Kolhapur and has been alleged to be the manufacturer of Aryan Gutka.
The Search and seizure action was conducted by the officers of the Food and Drugs Authority (FDA) under Food Safety and Standards Act, 2006 in unregistered gutka manufacturing factories in the area of Ichalkaranji, Kolhapur which included the premises of the Petitioner and raw material, processed gutka/supari, pouch, gunny bags, packing machines were recovered.
The finished packed pouches of Aryan Gutka said to have been manufactured by the petitioner were recovered at the shop of Balaji Supari Centre.
The Respondent authority after carrying out investigation, recorded statements, obtained further necessary information and on conclusion of the investigation, issued a show cause notice to the petitioners demanding the payment of excise duty from the petitioners, jointly and severally for the period February, 2013 to September, 2014 and from April, 2015 to August, 2015 under the provisions of Rule 17(2) of the Pan Masala Rules read with section 3A of the Central Excise Act, 1944.
The petitioner prayed before the court that the Rule 17(2) of the Pan Masala Packing Machines (Capacity, Determination and Collection of Duty) Rules, 2008is ultra vires the provisions of Section 3A of the Central Excise Act, 1944 and is unconstitutional.
The respondent authority submitted that there has been no violation of the principles of natural justice and clearly the alternate remedy by way of appeal should have been availed of by the petitioners.
The respondent further submitted that the same is untenable as the right of appeal is a statutory right and not an absolute right and can be circumscribed by the conditions in the grant.
The respondent authority contended that all the contentions and grounds taken up by the petitioners in the writ petitions can be taken up by them in the appeal provided under the Central Goods and Services Tax Act, 2017 and therefore, these petitions ought to be dismissed.
The division bench of Justice Abhay Ahuja and Justice Ujjal Bhunyan while dismissing the appeal stated that the challenge to the validity of Rule 17(2) of the Pan Masala Rules is rather without substance.
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