Computer Graphics Private Limited Vs Union of India (Bombay High Court)
In the case of Computer Graphics Private Limited v. Union of India, the Bombay High Court addressed two Writ Petitions challenging the delay in adjudication of show cause notices issued by the Revenue. The petitioner, a manufacturer of excisable goods including photographic color paper, graphic art film, and medical X-ray materials, held a Central Excise Registration Certificate and availed CENVAT credit for inputs, capital goods, and services under the CENVAT Credit Rules, 2004. The petitioner contended that the show cause notices issued on 16.03.2016 and 04.01.2017, covering the periods April 2011 to June 2015 and July 2010 to March 2011 respectively, alleging violations under Section 4(3)(d) of the Central Excise Act, 1944 and Rule 6 of the Central Excise Valuation Rules, 2000/2002, were delayed unreasonably and sought writ relief to quash them.
The 2016 show cause notice alleged that the petitioner failed to include VAT/CST amounts retained from buyers under a deferment scheme in the transaction value of excisable goods. The 2017 notice contained identical allegations for an earlier period. The petitioner argued that the delay in adjudicating these notices violated principles of fairness and equity, citing previous decisions such as Sanghvi Reconditioners Pvt. Ltd. v. Union of India and ATA Freight Line India Pvt. Ltd. v. Union of India, where adjudication of decades-old notices was quashed due to undue delay. Counsel for the petitioner contended that the delay severely hindered the ability to collect evidence, trace records, and secure testimony from officials no longer in service, causing prejudice.
