IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.BALAKRISHNAN NAIR & THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN TUESDAY, THE 23RD FEBRUARY 2010 / 4TH PHALGUNA 1931 WA.No. 935 of 2008() -------------------- AGAINST THE JUDGEMENT/ORDER IN WPC.22741/2004 Dated 25/07/2007 .................... APPELLANTS/RESPONDENTS ------------------------------------------ 1. COMMISSIONER OF EXCISE, GOVERNMENT OF KERALA, THIRUVANANTHAPURAM. 2. CIRCLE INSPECTOR OF EXCISE, SUPERSTAR DISTILLERIES AND FOODS LIMITED, PAMPADY, THIRUWILWAMALA, THRISSUR DISTRICT. 3. ACCOUNTANT GENERAL (KERALA), THIRUVANANTHAPURAM. 4. STATE OF KERALA, REPRESENTED BY ITS CHIEF SECRETARY, SECRETARIAT, THIRUVANANTHAPURAM. BY SR. GOVT PLEADER SRI. BENNY GERVASIS RESPONDENT/PETITIONER ------------------------------------------- M/S.SDF INDUSTRIES LIMITED, SDF HOUSE, CHANDRANAGAR P.O., PALAKKAD, REP. BY ITS LIAISON OFFICER, SUNNY MATHEW. ADV. SRI.M.KRISHNA KUMAR SMT.PRABHA R.MENON THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 22/02/2010, THE COURT ON 23/02/2010 DELIVERED THE FOLLOWING: K.BALAKRISHNAN NAIR & P.N.RAVINDRAN, JJ. -------------------------------------------------------------- W.A.No. 935 of 2008 -------------------------------- Dated this the 23rd day of February, 2010. JUDGMENT Balakrishnan Nair , J. Respondents in the writ petition are the appellants. The respondent herein filed the writ petition challenging Ext.P5 and seeking a direction to the first appellant to refund the excess amount received from it. The brief facts of the case are the following. 2. The first respondent is running a distillery engaged in compounding, blending and bottling Indian made foreign liquor. The distillery started functioning on 21.1.1995. The Excise Department deployed one Circle Inspector, one Preventive Officer and five Excise Guards to the said distillery from the said date to guard the functioning of the said unit. The respondent was remitting the salary and other expenses for the aforementioned excise guards. This was done under Rule 14 of Part I of the Kerala Distillery & Warehouse Rules, 1968. Supervision and guard by the Excise staff was mandatory under Rule 13 of the said rules, which reads as follows: “!3. Supervision and Guard:- The strength of the establishment maintained at a distillery shall ordinarily be one Excise Inspector, one Preventive Officer and three guards, but when, in the opinion of the Commissioner, such establishment is not sufficient to cope up with the work, it may be increased with the sanction of the Government.” W.A. No. 935 of 2008 2 The relevant portion of Rule 14 reads as follows: “14. Cost of establishment:- (1) The Distiller shall pay the cost of the establishment, employed in the distillery including allowance, leave salary and pension contribution at such rate as may be prescribed by the Government from time to time, and intimated to the licensee in writing. The cost of establishment of the officer and the staff shall be payable by the licensee in advance in the first day of every month as per countersigned chalan to be obtained from the Officer. If the licensee fails to remit the cost on the first day of every month, interest at eighteen percent shall be charged and from the 20th day of the month, penal interest at two and a half percent shall also be charged. If the licensee fails to remit the cost on the first day of the succeeding month he shall be served with a notice requiring him to remit the amount within a specified period and directing to show cause why staff should not be withdrawn for the default in remitting the amount before the expiry of the said period. If the licensee fails to remit the cost of establishment within the time stipulated in the notice, the Assistant Excise Commissioner of the Division shall address the Board of Revenue and get sanction for the withdrawal of the staff. The licensee shall be liable to pay the arrears of differential cost of establishment, if the rates of pay and allowances are revised by the government retrospectively. Explanation:- In this sub-rule 'cost of establishment' means average cost of pay, leave salary and pension contribution.” 3. The respondent was paying the amount due to the Excise Department without demur from time to time in accordance with the above said rules. While so, an additional claim for payment was raised on the respondent by the Accountant General as a result of pay revision. In that context, the respondent raised objection by filing Ext.P2 representation before the Excise Commissioner stating that excess amounts were claimed W.A. No. 935 of 2008 3 from it between 21.9.1995 and 26.6.1997. It was on 26.6.1997 that the Government fixed the staff pattern for the guard and supervision of the respondents' establishment as per G.O.(MS) 87/97 TD dated 26.6.1997. The claim of the respondent was that the excess amount collected from it between 21.9.1995 and 26.6.1997 should be refunded. The first appellant considered the said claim and rejected it by Ext.P5. The writ petition was filed challenging Ext.P5 and seeking consequential reliefs. 4. The learned single Judge after hearing both sides, allowed the writ petition. It was ordered to refund the excess amount collected before the issuance of the aforementioned Government Order dated 26.6.1997, which was produced by the appellants along with their counter affidavit as Ext.R1(a). The appellants feeling aggrieved by the said judgment, preferred this appeal. 5. We heard the learned counsel on both sides. According to the appellants, at the initial stage of operation of the plant, there was excess requirement of staff for guard and supervision. Therefore, they were deployed and the amounts were paid by the respondent. Only in 2003, for the first time, a claim was raised by the respondent that excess amounts were collected between 21.9.1995 and 26.6.1997. On the ground of delay alone, the claim should have been rejected. Further, the amounts were collected in relation to officers who were actually deployed, it is submitted. W.A. No. 935 of 2008 4 The learned counsel for the respondent on the other hand submitted that rules permit only deployment of five staff. Ext.R1(a) also is in confirmity with the said rules. Therefore the amount collected in excess is liable to be refunded and therefore the appeal may be dismissed, it is submitted. 6. Going by Rule 13, which we have quoted above, strength of staff is fixed as five, which should be followed ordinarily. The rule does not stand in the way of deploying excess staff. Of course, in such circumstances, permission of the Government has to be obtained. But, the delay or absence of sanction by the Government will not give any cause of action to the distillery concerned. It is not a case of deployment of highly disproportionate number of staff having regard to the requirement. It is a deployment made in good faith. The same has been explained in the counter affidavit. It is stated that since the distillery started functioning as a new unit, the presence of more staff was felt necessary and therefore they were deployed. So even if the deployment is not strictly in tune with Rule 13 of Part I of the aforementioned rules, the respondent cannot resist payment. Even assuming the deployment was irregular the same should have been challenged immediately at the time of deployment. The contentions raised after six years of such deployment should not have been entertained. The respondent does not have a case that the excess deployment was unnecessary or it was done with the malafide intention to W.A. No. 935 of 2008 5 harm its interest. So, we are of the view that the learned single Judge should not have interfered in the matter especially in view of the fact that the dispute was raised six years after the issuance of Ext.R1(a). In the result, the writ appeal is allowed. The judgment under appeal is reversed and the writ petition is dismissed. K.BALAKRISHNAN NAIR Judge P.N.RAVINDRAN Judge vps W.A. No. 935 of 2008 6