IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR WEDNESDAY, THE 26TH MARCH 2008 / 6TH CHAITHRA 1930 OP.No. 13351 of 1997(M) ----------------------------------- PETITIONER: ------------------- DANTEX RUBBER PVT. LTD., PLOT NO: 39-A, COCHIN EXPORT PROCESSING ZONE, COCHIN - 682030, REPRESENTED BY ITS DIRECTOR, OOMMEN JOHNSON. BY ADV. SRI.JOSEPH KODIANTHARA, ADV. SRI.THOMAS VELLAPPALLY. RESPONDENTS: ------------------------ 1. HINDUSTAN PETROLEUM CORPORATION LTD., TATAPURAM, P.B. NO. 1601, ERNAKULAM, REPRESENTED BY ITS SENIOR REGIONAL MANAGER. 2. THE GOVERNMENT OF INDIA, REPRESENTED BY THE UNDER SECRETARY TO GOVERNMENT, MINISTRY OF PETROLEUM & NATURAL GAS, NEW DELHI - 110011. 3. THE COMMISSIONER OF CUSTOMS & CENTRAL EXCISE, CUSTOM HOUSE, WILLINGDON ISLAND, COCHIN-9. *ADDL.R4. OIL CO-ORDINATION COMMITTEE, 2ND FLOOR, CORE 8, SCOPE COMPLEX, 7, INSTITUTIONAL AREA, LODHI ROAD, NEW DELHI - 110003, REPRESENTED BY ITS EXECUTIVE DIRECTOR, SUBIL RAHA. *ADDL.R4 IMPLEADED AS PER ORDER DATED 13/01/2000 IN C.M.P. NO. 1841/1999. O.P. NO. 13551/1997-M: **ADDL.R5. DEPUTY GENERAL MANAGER, INDIAN OIL CORPORATION LTD., PANAMPILLY AVENUE, PANAMPILLY NAGAR, COCHIN 682 036. **ADDL. R5. IMPLEADED AS PER ORDER DATED 13/01/2000 IN C.M.P. NO. 36024/1999. R1 BY ADV. SRI. A.M. SHAFFIQUE, R2 & R3 BY SMT.A.SREEKALA, ADDL.CGSC. THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 26/03/2008,ALONG WITH O.P NO. 13400/1997 & 13356/1997 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ORDER ON C.M.P. NO. 23949/1997 IN O.P. NO. 13351/1997-M DISMISSED 26/03/2008. SD/- T.R.RAMACHANDRAN NAIR, JUDGE. APPENDIX PETITIONER'S EXHIBITS : EXT.P.1: COPY OF THE LETTER OF REGISTRATION DTD. 11/11/1988 OF THE GOVERNMENT OF INDIA, MINISTRY OF COMMERCE. EXT.P.2: COPY OF THE LETTER DTD. 14/12/192 OF THE R.2. TO THE INDIAN OIL CORPORATION LTD. EXT.P.3: COPY OF THE CIRCULAR DTD. 23RD JULY 1993 ISSUED BY THE R.2. TO THE OIL CORPORATIONS. EXT.P.4: COPY OF THE CIRCULAR DTD. 26TH AUGUST 1994 ISSUED BY THE R.2. EXT.P.5: COPY OF THE CIRCULAR DTD. 25TH AUGUST 1995 ISSUED BY THE R.2. EXT.P.6: COPY OF THE STATEMENT OF THE R.1. EXT.P.7: COPY OF THE PETITIONER'S LETTER DTD. 20/03/1995 ADDRESSED TO THE R.1. EXT.P.8: COPY OF THE LETTER DTD. 25/10/1995 ISSUED BY THE DEVELOPMENT COMMISSIONER. EXT.P.9: COPY OF THE REPRESENTATION DTD. 21/06/95 FILED BY THE PETITIONER BEFORE THE HONOURABLE MINISTER OF COMMERCE. EXT.P.10: COPY OF THE LETTER DTD. 29/09/1995 ADDRESSED BY THE JOINT SECRETARY, MINISTRY OF COMMERCE TO THE JOINT SECRETARY OF THE R.2. EXT.P.11: COPY OF THE FINAL DETAILED REPRESENTATION DTD. 27/02/1996 FILED BY THE PETITIONER BEFORE THE R.1. EXT.P.12: COPY OF THE JUDGMENT DTD. 11/03/1997 IN O.P. NO. 4468/1997 OF THIS HONOURABLE COURT. EXT.P.13: COPY OF THE LETTER DTD. 15/05/1997 FROM THE R.1. TO THE PETITIONER. EXT.P.14: COPY OF THE CIRCULAR NO:21 DTD. 24/06/1997 OF THE CENTRAL BOARD OF EXCISE & CUSTOMS. EXT.P.15: COPY OF THE NOTIFICATION NO. 53/97 DTD. 03/06/97 ISSUED BY THE CENTRAL GOVT. UNDER THE CUSTOMS ACT. EXT.P.16: COPY OF THE NOTIFICATION NO. 13/81 DTD. 09/02/1981 ISSUED BY THE CENTRAL GOVT. UNDER THE CUSTOMS ACT. RESPONDENT'S EXHIBITS: NIL //TRUE COPY// prv. T.R.RAMACHANDRAN NAIR, J = = = = = = = = = = = = = = = = O.P.Nos. 13351, 13356 and 13400 OF 1997 = = = = = = = = = = = = = = = = = = = = = = Dated this the 26th day of March, 2008. J U D G M E N T All the petitioners herein owns and manages 100% export oriented units in the Cochin export Processing Zone, Kakkanad. The petitioner in O.P.No.13351/97 is engaged in the manufacture and 100% export of latex examination gloves. In O.P.No. 13356/97 the petitioner is engaged in the manufacture and 100% export of latex examination gloves and as far as in O.P.13400/97 is concerned they are also engaged in the same business. All these units are duly registered as 100% Export Oriented Units. The case of the petitioners is that in view of the fact that they are units which are registered as noticed above they are entitled to receive raw materials, capital goods, etc. free of excise duty and customs duty. They use furnace oil as a fuel in its 100% Export Oriented Unit. The 1st respondent is the sole supplier of the furnace oil to the petitioners. The issue that is raised in this case is the refusal of the 1st respondent to grant the benefits as such declared by the Government from time to time. O.P.Nos. 13351, 13356 and 13400 OF 1997 2 It is contended that being a Government Corporation they are bound to implement Exts.P2 to P5 and related instructions issued by Government of India with respect of supply of furnace oil at concessional rate. Even though the petitioners moved the 1st respondent for appropriate relief, 1st respondent has chosen to reject the representation as per Exts.P13 in O.P.13351/97 and O.P.No. 13400/97 and Ext.P11 in O.P.No. 13356/97. 2. The 1st respondent has filed a detailed counter affidavit explaining their stand. According to the 1st respondent, the arrangement was that the oil company would supply furnace oil for 100% EOUs at concessional rates and the oil company would in turn be reimbursed the differential price from the oil company's pool account. The further contention raised is that by clarification dated 31.5.94 the Ministry of Petroleum and Natural Gas, had declared that the furnace oil is not a commodity in surplus. The 1st respondent therefore contents that there is adequate justification to the action taken by the 1st respondent in stopping the supply of furnace oil at concessional rates with effect from 16.6.1994. 3. The Central Government's standing counsel has filed a O.P.Nos. 13351, 13356 and 13400 OF 1997 3 detailed statement in O.P.No. 13351/97. It is clearly stated therein that EPZ Unit, in terms of various exemption notifications were entitled to import and/or procure, duty-free, the capital goods, raw materials, components, spares, consumables etc. for the purposes of production and/ or manufacture of finished goods for exports out of India. Furnace oil being a consumable item for the manufacture of rubber gloves, the petitioner company was entitled to obtain the same, duty-free, either on importation or procurement from a factory of manufacture or a warehouse. It is also stated that as the letter of permission issued either by Ministry of Commerce or by the Development Commissioner of the zone being a licence for duty-free importation, there is no requirement of obtaining another licence for importation. The statement further reiterates that as the petitioners are entitled to obtain exemption from payment of duty as per Notifications No. 398/86 C.Ex. dated 26.8.1986 as amended and superceded by Notification No. 126/94 C.Ex. dated 2.9.1994, it is not clear why the petitioners have not availed the benefit. Therefore going by the averments in the statement it is clear that the petitioners were entitled for the benefit. The import of the various O.P.Nos. 13351, 13356 and 13400 OF 1997 4 notifications have not been considered by the 1st respondent while rejecting the request of the petitioners. Therefore the matter requires reconsideration at the hands of the 1st respondent. To enable the 1st respondent to do so, Exts.P13 in O.P.Nos.13351/97 and 13400/97 and Ext.P11 in O.P.No. 13356/97 are quashed. The petitioners may file a detailed representation in the light of the statement filed by the Central Government in these proceedings before the 1st respondent for claiming the benefits. On receipt of the same the 1st respondent shall consider it in accordance with law and communicate the decision to the petitioners herein within a period of two months from the date of receipt of a copy of this judgment. O.Ps are disposed of as above. T.R.RAMACHANDRAN NAIR JUDGE bkn/-