EICHER MOTORS LTD. AND ANR. versus UNION OF INDIA AND ORS. ETC.

EICHER MOTORS LTD. AND ANR. versus UNION OF INDIA AND ORS. ETC.

Section 37 does not empower authorities to make Rule 57F(4A); the rule cannot be applied to goods manufactured prior to 16.3.1995 on which duty has been paid and credit facility availed for further manufacture. Any manner of application of the rule would affect vested rights of assessees.

Parties
Petitioner: Eicher Motors Ltd.; Respondent: Union of India; Advocate: A.K. Ganguli; Advocate: V.A. Mohta; Advocate: A.N. Haksar; Advocate: Raju Ramachandran; Advocate: Ashok Desai; Advocate: Joseph Vellapelly; Advocate: A. Subba Rao; Advocate: K. Swamy; Advocate: Dilip Tandon; Advocate: V.K. Verma; Advocate: K.G. Bhagat; Advocate: Vineet Bhagat; Advocate: Debasis Misra; Advocate: J.D. Jain; Advocate: P.K. Ram; Advocate: D.N. Mishra; Advocate: Joseph Pookkatt; Advocate: Prashant Kumar; Advocate: V. Sridharan; Advocate: V. Balachandran; Advocate: R. Nambirajan; Advocate: Pragyan Sharma; Advocate: Tarun Gulati; Advocate: Rajendra Singhvi; Advocate: Ashok Kr. Singh; Advocate: Ms. Indu Malhotra; Advocate: M.L. Lahoty; Advocate: Paban Sharma; Advocate: Himanshu Shekhar; Advocate: R. Anand Padmanabhan; Advocate: Rajeev Kapoor; Advocate: Rakesh K. Sharma
Jurisdiction
India
Judgment Date
28 January 1999
Procedural Posture
Transferred Cases (c) Nos. 7 and 8 of 1998 / Civil Original Jurisdiction
Outcome
Petitions allowed
Legal Topics
Central Excise, MODVAT Credit, Rule Making Powers, Promissory Estoppel, Legitimate Expectation
Tax Law Central Excise MODVAT Credit Rule Making Powers Promissory Estoppel Legitimate Expectation

Case Brief

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Parties

Eicher Motors Ltd.

Petitioner

Union of India

Respondent

A.K. Ganguli

Advocate

V.A. Mohta

Advocate

A.N. Haksar

Advocate

Raju Ramachandran

Advocate

Ashok Desai

Advocate

Joseph Vellapelly

Advocate

A. Subba Rao

Advocate

K. Swamy

Advocate

Dilip Tandon

Advocate

V.K. Verma

Advocate

K.G. Bhagat

Advocate

Vineet Bhagat

Advocate

Debasis Misra

Advocate

J.D. Jain

Advocate

P.K. Ram

Advocate

D.N. Mishra

Advocate

Joseph Pookkatt

Advocate

Prashant Kumar

Advocate

V. Sridharan

Advocate

V. Balachandran

Advocate

R. Nambirajan

Advocate

Pragyan Sharma

Advocate

Tarun Gulati

Advocate

Rajendra Singhvi

Advocate

Ashok Kr. Singh

Advocate

Ms. Indu Malhotra

Advocate

M.L. Lahoty

Advocate

Paban Sharma

Advocate

Himanshu Shekhar

Advocate

R. Anand Padmanabhan

Advocate

Rajeev Kapoor

Advocate

Rakesh K. Sharma

Advocate

Procedural Posture

Transferred Cases (c) Nos. 7 and 8 of 1998 / Civil Original Jurisdiction

Legal Issues

  1. 1 Whether Rule 57F(4A) Central Excise Rules, 1944 lapsing MODVAT credit unutilised on 16.3.1995 is valid and applicable to goods manufactured prior to 16.3.1995
  2. 2 Whether Section 37 of the Central Excises and Salt Act, 1944 confers power on the Central Government to frame a rule enabling lapsing of MODVAT balance
  3. 3 Whether the rule is arbitrary, unreasonable, or ultra vires the Act

Ratio Decidendi

Section 37 does not empower authorities to make Rule 57F(4A); the rule cannot be applied to goods manufactured prior to 16.3.1995 on which duty has been paid and credit facility availed for further manufacture. Any manner of application of the rule would affect vested rights of assessees.

Court Disposition

Petitions allowed

Orders

  • Rule 57F(4A) cannot be applied except in the manner indicated; it cannot be applied to goods manufactured prior to 16.3.1995 where credit facility has been availed
  • No order as to costs