Full Judgment Text
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CASE NO.:
Appeal (civil) 1882 of 2004
PETITIONER:
M/s. O.N.G.C. Ltd
RESPONDENT:
Commnr. Of Customs, Mumbai
DATE OF JUDGMENT: 01/08/2007
BENCH:
S.B. Sinha & Markandey Katju
JUDGMENT:
JUDGMENT
O R D E R
I.A. NO. 4
IN
CIVIL APPEAL NO. 1882 OF 2004
S.B. SINHA, J :
Appellant is a public sector undertaking wholly owned and controlled
by the Central Government. It obtained the services of M/s. SEDCO Forex
Int. Drilling Inc. for obtaining requisite information which would assist it in
the matter of exploration of oil and gas. The information so gathered was
recorded in 3-D Seismic Tapes. On the amount paid therefor, custom duty
was sought to be levied. An exemption was claimed by the appellant from
payment of custom duty in terms of an exemption notification issued by the
Central Government in that behalf. As despite such claim, assessment
proceedings were initiated and completed, the matter came upto this Court
and by a judgment and order dated 24.08.2006, contention of the appellant
was accepted by this Court and the orders of assessment were set aside.
During pendancy of the Civil Appeals before this Court, a sum of Rs.
54,72,87,536.00 was realised by way of custom duties and interest thereon,
etc. as per the following details:
\023(i) 14.09.2004 Rs. 25,00,00,000.00 adjusted towards duty
(ii) 30.03.2004 Rs. 17,72,87,536.00 appropriated towards interest
(iii) 24.02.2005 Rs. 12,00,00,000.00 adjusted towards interest
Total Rs. 54,72,87,536.00\024
An application has now been filed for a direction to the respondent to
pay interest on the said sum with effect from the date of recovery till the date
of the appellant.
Mr. S. Ganesh, learned senior counsel appearing on behalf of the
Appellant, would submit that keeping in view the fact that the appellant had
to deposit a huge amount during pendency of the Civil Appeals, interest of
justice would be met if this Court directs the respondent to pay interest at the
rate of 12% per annum on the said amount. It was submitted that interest
should be directed to be paid by way of restitution, as has been held by this
Court in South Eastern Coalfields Ltd. v. State of M.P. and Others [(2003) 8
SCC 648].
Mr. Rajiv Dutta, learned senior counsel appearing on behalf of the
respondent, on the other hand, would submit that the Central Government
did not make any investment of the amount received by it by way of indirect
tax but expended the same for the welfare of the people and, thus, no interest
should be directed to be paid in the instant case.
Appellant is a public sector undertaking. Respondent is the Central
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Government. We agree that in principle as also in equity the appellant is
entitled to interest on the amount deposited on application of principle of
restitution. In the facts and circumstances of this case and particularly
having regard to the fact that the amount paid by the appellant has already
been refunded, we direct that the amount deposited by the appellant shall
carry interest at the rate of 6% per annum. Reference in this connection may
be made to Pure Helium India (P) Ltd. v. Oil & Natural Gas Commission,
(2003) 8 SCC 593 and Mcdermott International Inc. v. Burn Standard Co.
Ltd. & Ors. 2006 (6) SCALE 220.
Respondent, therefore, is directed to pay a sum of Rs.
9,51,21,999.50/- by way of interest. Such amount should be paid within a
period of six weeks from date. The application is disposed of accordingly.
No costs.