Case: Wallace Pharmaceuticals Limited & Another Vs. Union of India, Through The Secretary, Ministry of Chemicals & Fertilizers, Department of Chemicals & Fertilizers & Others

Oral Judgment: (V.M. Kanade, J.)In this petition, Rule was granted by the Division Bench of this Court on 20th September, 1999. Thereafter, this Court was informed that the issue raised in this petition was pending before the Apex Court and, as such, the petitions, on this point, which were pending in various High Courts were adjourned sine die. Finally, Transfer Petition (Civil) No(s). 475-496 of 2003 were disposed of by the Apex Court by order dated 3rd May, 2010 and a direction was given by the Apex Court to dispose of the petitions without any undue delay. The following order was passed by the Apex Court:ORDER.The Transfer Petitions filed at the instance of the Union of India are of the years 2003 and 2006 respectively. The earlier one was last listed before the Court on October 18, 2005, when no effective order was passed. During the long pendency of these Transfer Petitions, it is reported that some of the cases pending before the different High Courts have been disposed of and some others in other High Courts would have been heard and disposed of but for the pendency of these Transfer Petitions.In those circumstances, we find that no useful purpose will be served by keeping these Transfer Petitions pending before this Court any longer. These Transfer Petitions are, accordingly, dismissed.It is made clear that since these Transfer Petitions are no longer pending before this Court, there is no impediment in the way of the respective High Courts in proceeding with the cases pending there and dispose them of without any undue delay.The Special Leave Petitions, to which these Transfer Petitions were connected, may be listed in due course.In view of the disposal of the Transfer Petitions in the Supreme Court, this petition was taken up for hearing.2. By this petition which is filed under Articles 226 and 227 of the Constitution of India, the petitioners are seeking the following reliefs:[a] for a declaration of this Honble Court that -(i) the provisions of para 7(2)(a) of the DPCO, 1979, is ultra vires Article 14 of the Constitution of India, unconstitutional and void; and(ii) that the impugned notice dated 7th August, 1998 (Exh.N hereto) read with the Report/Recommendations dated 8th July, 1997 made by the 2nd Respondent (Exh.P hereto) are exfacie illegal, ultra vires the DPCO, 1979, read with the DPCO, 1987 are void;(b) For a writ of certiorari or a Writ in the nature of certiorari or any other appropriate Writ, order or direction under Article 226 of the Constitution of India calling for the entire records and proceedings of the case and after going into the legality, validity and propriety of the quashing and setting aside the said recommendations/report of the 2nd Respondent dated 8th July, 1997 (Exh.P hereto), the impugned Order dated 7th August 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto);(c) For a Writ of Mandamus or a Writ in the nature of Mandamus or any other appropriate writ, order or direction under Article 226 of the Constitution of India against the Respondents for ;(i) staying the operation, implementation and effect of the said impugned Order dated 7th August 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto);(ii) restraining the Respondents by themselves, their agents, servants, officers and subordinates from taking any action whatsoever against the Petitioners pursuant to and/or in implementation of the said impugned order dated 7th August, 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto), and in particular restraining the Respondents from taking any coercive steps against the petitioners for recovery of the amount of Rs.8,08,870/- comprising of Rs.2,82,071/- as principal amount and balance interest thereon or any other amount whatsoever.(iii) furnishing to the Petitioner the terms of reference of the 2nd Respondents viz. The Murthy Committee Report and the 1990 Line of Action on the basis of which the 2nd Respondent was required to make and has made its Report dated 8th July, 1997;(iv) furnishing to the Petitioner the written submissions made by the Respondent No.3 on behalf of Respondent No.1 to Respondent No.2 during the proceedings before the 2nd Respondent;[d] For a writ or prohibition or an other writ, order or direction prohibiting or restraining the Respondents, their agents, servants and subordinates from taking any action on or in pursuance of the impugned Notice dated 7th August, 1998 read with the Report/Recommendations dated 8th July, 1997 made by the 2nd Respondent and recovery notice dated 15th March, 1999 (Exh.Q hereto);(e) That pending the hearing and final disposal of the Writ Petition, this Honble Court be pleased to pass the following order for:(i) staying the operation, implementation and effect of the said impugned Order dated 7th August 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto);(ii) restraining the Respondents by themselves, their agents, servants, officers and subordinates from taking any action whatsoever against the Petitioners pursuant to and/or in implementation of the said impugned order dated 7th August, 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto), and in particular restraining the Respondents from taking any coercive steps against the petitioners for recovery of the amount of Rs.8,08,870/- comprising of Rs.2,82,071/- as principal amount and balance interest thereon or any other amount whatsoever.(iii) furnishing to the Petitioner the terms of reference of the 2nd Respondents viz. The Murthy Committee Report and the 1990 Line of Action on the basis of which the 2nd Respondent was required to make and has made its Report dated 8th July, 1997;(iv) furnishing to the Petitioner the written submissions made by the Respondent No.3 on behalf of Respondent No.1 to Respondent No.2 during the proceedings before the 2nd Respondent;(f) for ad interim relief in terms of prayer (e) above;(g) for costs; and(h) for such further and other reliefs as the nature and circumstances of the case may require.3. Learned Counsel appearing on behalf of the petitioners submitted that he was not pressing prayer clause [a](i) wherein the vires of the provisions of para 7(2) of the DPCO, 1979 was challenged on the ground that it is ultra vires Article 14 of the Constitution of India and, therefore, unconstitutional and void. He also submitted that he was not pressing the interim reliefs as claimed in prayer clauses (c), (d) and (e). The only relief, therefore, which is prayed is in terms of prayers [a](ii) and [b] which read as under:[a] (ii) that the impugned notice dated 7th August, 1998 (Exh.N hereto) read with the Report/Recommendations dated 8th July, 1997 made by the 2nd Respondent (Exh.P hereto) are exfacie illegal, ultra vires the DPCO, 1979, read with the DPCO, 1987 are void;[b] For a writ of certiorari or a Writ in the nature of certiorari or any other appropriate Writ, order or direction under Article 226 of the Constitution of India calling for the entire records and proceedings of the case and after going into the legality, validity and propriety of the quashing and setting aside the said recommendations/report of the 2nd Respondent dated 8th July, 1997 (Exh.P hereto), the impugned Order dated 7th August 1998 (Exh.N hereto) and recovery notice dated 15th March, 1999 (Exh.Q hereto);4. Brief facts which are relevant for the purpose of deciding the present petition, are as under:(i) Petitioner No.1 is a Company incorporated under the Companies Act, 1913 and carries on, inter alia, business of manufacturing and marketing pharmaceutical products and formulations. The second petitioner is the servant of petitioner No.1 and is a citizen of India. Respondent No.2 is a Committee constituted by respondent No.1 Union of India to review matters arising out of prices charged by various drug companies in India for sale of bulk drugs and formulations and determine the liabilities of drug companies on the over charged amounts between 1981 and 1987 and to make the recommendations to the Government of India in respect of recoveries from the pharmaceutical industry into Drugs Price Equalisation Account (DPEA). The said Committee has been directed to determine the liabilities in accordance with the recommendations of the Price Review committee (Murthy Committee) and according to the Line of Action as determined by the Department in 1990.(ii) The petitioners started manufacturing various formulations made from and using the imported bulk drug Rifampicin under the trade name Rifadin effective from April, 1982. The petitioners were marketing these formulations of Rifampicin at the leader prices notified by respondent No.1 under the provisions of DPCO, 1979.(iii) Respondent No.1 fixed the maximum sale price in respect of one of the formulations of Rifadin capsule (450 mg/Cap/4s at Rs.10.35). The said price fixation order was issued under para 13(1)(a) of the DPCO, 1979.(iv) Applications were made by the petitioner dated 30th June, 1984 and 27th July, 1984 requesting respondent No.1 to fix/revise the prices of the formulations manufactured by the petitioner from and using the said bulk drug Rifampicin.(v) Reply was given by respondent No.1 dated 3/13th August, 1984 and the petitioners were informed that the Government had already notified leader prices in respect of the said formulations and that the petitioners should, accordingly, follow the leader prices.(vi) The petitioner was importing the bulk drug Rifampicin which was not indigenously manufactured/available in India and, therefore, the petitioner by an application dated 23rd August, 1984, submitted in prescribed Form 2 for information of landed cost in respect of the said bulk drug. This application, according to the petitioners, was neither considered nor disposed of by respondent No.1.(vii) Thereafter, respondent No.1 fixed leader prices in respect of various formulations manufactured out of the said bulk drug by notification dated 12th September, 1984, as a result of which the leader prices were further reduced.(viii) The petitioners found that the cost of production of the formulations made from the bulk drug Rifampicin, including the cost of procurement was much higher and, therefore, it was rendered unviable and accordingly, the petitioner made an application in Form 3 for price fixation/revision of the said formulations. However, respondent No.1 by a letter dated 25th September, 1984, directed the petitioner to follow the leader prices fixed by its order dated 12th September, 1984 and the request made by the petitioner was not taken into consideration.(ix) It is the case of the petitioners that since the said drug and formulations were anti-tuberculosis drugs, the petitioner company, under protest, complied with the directions given in the letter dated 25th September, 1984 and followed the leader prices fixed by respondent No.1.(x) Respondent No.1 once again revised the leader prices in respect of one of the formulations of Rifadin Capsule 450 mg 4s by price fixation order dated 2nd March, 1984.(xi) The petitioners again protested this notified prices and made an application for revision of the retail price by filing their application in Form No.3. However, the said application also was not considered by respondent No.1 and, as a result, the petitioner Company discontinued to manufacture and sale of the formulations sometime in August, 1985, since the prices were totally uneconomical, beyond the control of the petitioners, having regard to the cost of procurement of the bulk drug and since there was no response from respondent No.1.(xii) Thereafter, sometime on 21st October, 1986, a notification was issued fixing the price of indigenous bulk drug.(xiii) In the meantime, sometime on 17th September, 1986, after the petitioner company discontinued manufacture and sale of formulations, respondent No.1 called upon the petitioner to forward the details for the period from 1st April, 1979 onwards relating to import/procurement of utilisation of the bulk drug Rifampicin and also give details in respect of the set off duly supported by necessary bills and invoices to enable the Department to determine the recovery into the Drug Prices Equalization Account. Accordingly, the petitioner complied with the said request and provided the details of import/procurement of the said drug.(xiv) On 25th August, 1987, the DPCO, 1987 was enacted.(xv) Respondent No.1, by demand notice dated 6th October, 1987 called upon the petitioners to pay an amount of Rs.2,82,071/- which was determined under as unintended profit made by the petitioner Company during the period 1st April, 1979 to 31st March, 1984 on account of the difference in the prices of the bulk drug Rifampicin allowed in the formulations and the actual import price in terms of para 7(2) of the DPCO, 1979.(xvi) A representation was made by the petitioner that the said order had been passed, without giving any reasons and without taking into consideration the data submitted by the petitioners.(xvii) Thereafter, the matter was again referred to respondent No.2 for review.(xviii) The petitioner Company, thereafter received a demand notice for recovery on behalf of respondent No.4 dated 15th March, 1999.(xix) Being aggrieved by the said demand notice, the petitioners have filed this petition.5. Mr. Singbal, learned Counsel appearing on behalf of the petitioners submitted that the petitioners have never charged above the leader prices and, as such, the respondents would not be entitled to recover the alleged unintended profit made by the petitioner Company. It was submitted that the said bulk drug was not available in India since it was not indigenously manufactured in India and accordingly, had requested respondent No.1 to revise the prices of the formulations manufactured by the petitioners using the said bulk drug. It was then submitted that for the period 28th April, 1982 till 30th September, 1983 the actual import price was Rs.3922.90 per kg. and for the period October, 1983 till February, 1984, it was 2190.32 and it was well below the price allowed for the formulations. It was contended that, on the other hand, in respect of the four other imports, namely dated 23rd February, 1984, 25th May, 1984, 20th September, 1984 and 19th April, 1985, the actual import price was more than the price allowed in the formulations and, as such, for the said four imports, the petitioners had to suffer a loss of Rs.6,77,496/-. It was then contended that the request made by the petitioners, without prejudice to their submissions that the average of the six imports should be taken into consideration, was also not allowed and, as a result, the petitioners had to stop manufacture of the said drug and only thereafter, in 1986, the bulk price was fixed. It was, therefore, contended that the bulk price having been fixed in 1986, it was not open for the respondents to have recovered the difference in the import price and the bulk price which was fixed in 1986. It was next submitted that so far as other drugs are concerned, namely Amoxycillin Trihydrate, for the price of the bulk drug which was fixed with effect from 2nd September, 1983, no liability was shown for the period prior to the fixing of the bulk price i.e. for the years 1979-80, 1980-81, 1981-82, and 1982-83. It was submitted that the respondents should have adopted the same criteria in respect of the bulk drug which was imported by the petitioners. Learned Counsel for the petitioners has also relied upon a judgment of the Division Bench of Karnataka High Court in the case of M/s. Astra Zeneca Pharma India Limited vs. Union of India and another, (Writ Petition No. 26118/2005(GMRES (C/W WRIT PETITION NO.9463 OF 2006) (GM-RES)) and submitted that the ratio of the said judgment squarely applies to the facts of the present case. He submitted that the Karnataka High Court in a similar case set aside the demand notice issued by the respondents on the ground that the price of the bulk drug was not notified and, therefore, had held that if the leader price was not transgressed, then in that event merely because the import price of the bulk drug was less than the bulk price which was subsequently declared, that would not be a ground for coming to the conclusion that the difference in price would amount to unintended profit.Learned Counsel appearing on behalf of the petitioners has also submitted his detailed legal submissions, which are at page 436 of the petition.6. Mr. Amonkar, learned Central Government Standing Counsel appearing on behalf of respondents No.1 to 3, on the other hand, vehemently opposed the submissions made on behalf of the petitioners. He invited our attention to the various provisions under the DPCO, 1979 and DPCO, 1987 and more particularly, para 7(2) of the DPCO, 1979. He took us through the main order and submitted that overall profits and losses incurred by the Company in manufacture and sale of the formulations were not relevant for the purpose of invoking para 7(2) of the DPCO, 1979. It was submitted that for the period when the petitioner Companys procurement price of bulk drug Rifampicin was higher than the price of bulk drug allowed in formulations prices, the remedy open to the petitioner Company was to seek price revision in the price of their formulations under paras 13 and 14 of the DPCO, 1979. Therefore, the petitioner Company was not entitled to claim any set off. Our attention was invited to sub-clause (2) of para 7 of the DPCO, 1979. It was submitted that after the judgment of the Apex Court in Union of India vs. Cyanamid, reported in AIR 1987 SC 1802 , the Government had appointed a Price Review Committee headed by Shri M. S. Murthy, the then adviser (Chemicals). The Price Review Committee was to review the price fixed by the Government. The said report was summarily rejected by the Government and the then Minister for Petroleum and Chemicals evolved a line of action in 1990. In reply, however, the respondents admitted that by Order dated 24th August, 1983, the maximum sale price in respect of Rifadin capsules based on bulk drug Rifampicin, the said price was fixed under sub-para 13(1) and not under 13(1)(a) of the DPCO, 1979. It is admitted that the notification of price of indigenous bulk drug was fixed for the first time on 21st October, 1986. Learned Counsel for the respondents has taken us through the detailed affidavit-in-reply and sur-rejoinder filed on behalf of the respondents. Reliance was also placed on the judgment of the Division Bench of Bombay High Court in Indian Drugs Manufactures Association and ors. vs. Union of India and ors., (Writ Petition No.2368/1996) and it was submitted that all the questions were answered in this writ petition and in view of the Judgment of the Bombay High Court, the petitioners were not entitled to get the relief as claimed by them in the petition.7. After having heard both the Counsel, at length, in our view, the question which falls for consideration is whether the respondents were entitled to claim an amount of Rs. 2,82,071/- as unintended profit, along with interest thereon The respondents claim that they are entitled to recover the said amount by virtue of sub-para (2) of para 7 of the DPCO, 1979, which reads as under:7(2) where a manufacturer of formulations utilizes in his formulations any bulk drug, either from his own production or procured by him from any other source, the price of such bulk drug being lower than the price allowed to him in the price of his formulations, the Government may require such manufacturer.(a) to deposit into the Drug Price Equalisation Account referred to in para 17 the excess amount to be determined by the Government; or(b) to sell the formulations at such prices as may be fixed by the Government.8. In the present case, it is an admitted position that the Government had fixed the leader prices for the purpose of sale of these formulations and admittedly, the petitioner Company had not sold the drugs beyond the said leader prices. Similarly, it is also an admitted position that the respondents had also not fixed the bulk price of indigenous bulk drug during the relevant period from 1979 till 1985 and the said price was fixed for the first time on 21st October, 1986. This fact has not been denied by the respondents. Had the said price been fixed and if the import of the said drug was less than the price of indigenous bulk drug fixed in view of para 7(2), it was incumbent on the manufacturer to have deposited the excess amount referred to in para 17, with the Government. However, in the present case, inspite of repeated representations being made, the respondents neither fixed the said price of indigenous bulk drug, nor revised the leader prices and, as a result, since the bulk drug was not available in India or was not manufactured in India, the petitioner Company had to import the said bulk drug. Incidentally, for the first two years the said import price happened to be lesser than the price which was fixed in 1986. Whereas, for the remaining four imports, the said price was much higher than the bulk price which was fixed of indigenous bulk drug. In the present case, the respondents chose to select two years, namely 1982-83 and 1983-84 () for the purpose of charging unintended profit on the ground that the petitioners ought to have deposited the said amount into the Drug Price Equalisation Account.9. A similar issue arose before the Karnataka High Court in M/s. Astra Zeneca Pharma India Limited vs. Union of India and another (supra). The Karnataka High Court has mentioned the facts of the second writ petition in para 10. Para 10 reads as under:10. Insofar as the second writ petition is concerned, the petitioner had manufactured formulations based on the bulk drug Refampicin during the period the DPCO 1979 was in force. The bulk drug which was procured either indigenously or through import was used in the production and sale of formulations made from the bulk drug from 2.11.1981. The petitioner discontinued the production of the formulations, with effect from 24.8.1984. It is stated that the respondent did not fix or notify any price in respect of the bulk drug Refampicin prior to 27.10.1986. It is hence, contended that from 1.11.1979, when DPCO 1979 came into effect, till 27.10.1986, there was no notification as regards the price of the bulk drug Refampicin. It is only on 27.10.1986, that the first respondent fixed the maximum sale price of the drug at Rs.3,098/- per kg.It was contended on behalf of the petitioner in para 21 as under:21. Insofar as the second of the petitions is concerned Shri Holla contends that if a leader price is fixed in respect of a formulation a manufacturer is entitled to sell the formulation at or below the leader price. If the manufacturer sells the formulations at or below the leader price it would be illogical for the Central Government to pass an order under Section 7(2)(a) of DPCO 1979 to deposit any amount into the Drug Price Equalisation Account.10. While dealing with the said submission, Karnataka High Court did not accept the stand of the respondents that there was no need for notifying the procurement price of the bulk drug allowed in fixing the leader price of formulations prepared out of the bulk drug as it was being imported prior to 1986 by holding that the said contention was not supported by any legal provision and, therefore, the contention of the petitioner was accepted by making the following observations in paras, 31, 32 and 33:31. Insofar as the second of the petitions is concerned the question that arises for consideration is whether, in the absence of the first respondent having fixed or notified a price in respect of the bulk drug Rifampicin till 27.10.1986, it was open for the first respondent to claim the difference between the price of Rifampicin allowed in the formulations and the import or procurement price during the period 1.4.1979 to 31.3.1984, under paragraph 7(2) of the DPCO 1979. It is admitted by the respondent that the price of indigenously manufactured bulk drug Rifampicin was notified for the first time on 27.10.1986. However, it is sought to be contended that the import price of the bulk drug fixed from time to time in respect of the period prior to 27.10.1986 could be taken into account, in fixing the leader price of the formulations made from the said bulk drug. As it is an anti-tubercular drug and falls under category III of Schedule III and therefore the Government is empowered to fix the leader price in terms of paragraph 13(6) of the DPCO 1979.32. The stand of the respondent that there was no need for notifying the procurement price of the bulk drug allowed in fixing the leader price of formulations prepared out of the bulk drug as it was being imported prior to 1986, is not a contention that is supported by any legal provision. No such presumption arises from reading of the Scheme of the DPCO 1979. The respondent seeking to read paragraph 13(6) of the DPCO 1979 in isolation to trace the power of the Government to fix the leader price of a formulation falling under Category III of Schedule III does not meet the requirement of the price of the bulk drug being notified even if imported. No such presumption that the price of the bulk drug ought to be taken as the price at which it is imported be taken into account in the petitioner proceeding to find its own alleged liability.33. In the absence of any determination of the liability of the petitioner in terms of the DPCO 1979 prior to its repeal no liability can be fastened on the petitioner on the strength of paragraph 14 of the DPCO 1987.Accordingly, the petitions deserve to be allowed.The writ petitions ie WP.26118/2005 and WP 9463/2006 are hereby allowed.Annexures S.V, AA, CC and DD in WP.26118/2005 are hereby quashed.Annexures M and HH in WP 9463/2006 are hereby quashed.Ordered accordingly.11. In our view, the ratio of the said judgment of the Karnataka High Court clearly applies to the facts of the present case. It is an admitted position that the said judgment and order of the Karnataka High Court has, so far, not been challenged by the respondents, in the Apex Court and, as such, as of today, the finding given by the Karnataka High Court has become final. The ratio of the said Judgment clearly applies to the facts of the present case, and, as such, the contention of the learned Counsel appearing on behalf of the petitioners will have to be accepted.12. Learned Counsel for the respondents has relied on the judgment of the Bombay High Court in Indian Drugs Manufactures Association and ors. vs. Union of India and ors., (supra). In our view, the ratio of the said judgment would not apply to the facts of the present case, since the question which fell for consideration before the Division Bench of Bombay High Court was, whether, after repeal of the provisions of para 7(2) and 17 of the DPCO, 1979 with effect from 26th August, 1987, the show cause notices could have been issued for the recovery of the amount which had actually accrued during the continuance of the DPCO, 1979 In paragraphs 1 and 2, the issue involved before the Division Bench has been succinctly mentioned. Paragraphs 1 and 2, read as under:The question which arises for consideration in the above petition is whether the respondents have the power and authority to issue the impugned notices invoking paragraph 7(2) of the Drugs (Prices Control) Order, 1979 read with paragraph 14 of the Drugs (Prices Control) Order, 1987 and para 12 of the Drugs (Prices Control) Order, 1995 after the repeal of the Drug (Prices Control) Order, 1979.2. The main substantive reliefs sought in the above petition are prayer clauses (a) and (b) of the petition which read as under:(a) For the following declaration of this Honble Court:(i) that on a true construction of the DPCO, 1979 read with the DPCO, 1987 and DPCO, 1995, only those amounts which had been finally determined to be due and payable by a manufacturer and which had actually accrued during the continuance of the DPCO, 1979, and which satisfied the tests of Constitutional and Essential Commodities Act requirements, can be recovered from the concerned manufacturer for deposit in the DPEA;(ii) that under no other circumstances can the respondents purport to invoke the provisions of Paras 7(2) and 17 of the DPCO, 1979, after its repeal with effect from 26th August, 1987;(iii) that the impugned Notice (Specimen copy Exhibit A hereto) and all similar notices issued by the respondents to the members of the 1st and 3rd petitioners are all issued without the authority of law, being ex facie ultra vires the DPCO, 1979, 1987 and 1995, ultra vires Articles 14, 265 and 300-A of the Constitution of India and are null and void and of no legal effect whatsoever;(iv) That the respondents are not authorised or entitled in law to issue to the members of the 1st and 3rd petitioners such notices in the future;(b) For a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ, order or direction under Article 226 of the Constitution of India calling for the records of the case and after going into the legality of the same, quashing and setting aside the impugned notice Exhibit -A- hereto as also all similar notices issued by the respondents to the members of the 1st and 3rd petitioners.13. Perusal of the said observations reveal that the challenge in the said petition was on a totally different ground and, as such, the observations which are made in the context of paragraph 7(2) would strictly not apply to the facts of the present case and the learned Counsel appearing on behalf of the respondents was unable to point out any observations which were either directly contrary to the ratio of the judgment of the Karnataka High Court or in favour of the arguments advanced by the respondents in the present case.

Decision:
1[ds]11. In our view, the ratio of the said judgment of the Karnataka High Court clearly applies to the facts of the present case. It is an admitted position that the said judgment and order of the Karnataka High Court has, so far, not been challenged by the respondents, in the Apex Court and, as such, as of today, the finding given by the Karnataka High Court has become final. The ratio of the said Judgment clearly applies to the facts of the present case, and, as such, the contention of the learned Counsel appearing on behalf of the petitioners will have to be accepted.In our view, the ratio of the said judgment would not apply to the facts of the present case, since the question which fell for consideration before the Division Bench of Bombay High Court was, whether, after repeal of the provisions of para 7(2) and 17 of the DPCO, 1979 with effect from 26th August, 1987, the show cause notices could have been issued for the recovery of the amount which had actually accrued during the continuance of the DPCO, 1979  In paragraphs 1 and 2, the issue involved before the Division Bench has been succinctly mentioned.Perusal of the said observations reveal that the challenge in the said petition was on a totally different ground and, as such, the observations which are made in the context of paragraph 7(2) would strictly not apply to the facts of the present case and the learned Counsel appearing on behalf of the respondents was unable to point out any observations which were either directly contrary to the ratio of the judgment of the Karnataka High Court or in favour of the arguments advanced by the respondents in the present case.