2010 (9) TMI 369 - HC - Central Excise

Demand of duty - petitioner was availing the facility of monthly payment AC passed an order - withdrawing the facility of paying duty on monthly basis - Division Bench of this Court admitted the writ petition and while granting stay of the order - order passed without hearing the petitioner and the second order has been passed does not deal with any of the contentions raised by the petitioner - Held that - In the absence of any reasons for rejecting the arguments of the petitioner the impugned orders cannot be sustained - order set aside and the matter is remitted back

Summary

Issues: Challenge to orders dated 23-1-2002 and 9-4-2002 passed by Assistant Commissioner, Central Excise Division-I, Nagpur regarding withdrawal of monthly payment facility for excise duty.

The petitioner, engaged in manufacturing wires falling under a specific chapter sub-heading of the Central Excise Tariff, challenged orders dated 23-1-2002 and 9-4-2002 passed by the Assistant Commissioner, Central Excise Division-I, Nagpur. The initial order withdrew the facility of monthly payment of excise duty due to discrepancies found during departmental checks, where duty was not paid for clearances under certain invoices. The High Court observed that the first order was issued without hearing the petitioner, and the subsequent order did not address the petitioner's contentions, emphasizing the importance of following principles of natural justice. The Court held that failure to provide reasons for rejecting the petitioner's arguments resulted in a miscarriage of justice. Consequently, both orders were quashed, and the matter was remitted back for a fresh order on merits by a different Competent Officer. The Court directed that the case should not be heard by the officer who issued the impugned order.

In conclusion, the High Court found that the Assistant Commissioner's failure to pass a reasoned order after hearing the petitioner and addressing their contentions amounted to a violation of natural justice. By quashing the orders dated 23-1-2002 and 9-4-2002, the Court emphasized the necessity of providing reasons for decisions in quasi-judicial proceedings. The case was remitted for a fresh order by a different officer to ensure a fair and just resolution based on merits.