2010 (9) TMI 372 - HC - Central Excise

Natural justice - authority had denied the opportunity to cross-examine - authority indicates that the respondent had disputed certain facts recorded in the panchnama and had also alleged suppression of the statement - authority has cursorily brushed aside the request cross examine the witnesses on the grounds and invalid reasons - matter remanded to the Commissioner CBEC Circular No. 752/68/2003-C.X. dated 1-10-2003 as reproduced in the impugned order which clarifies that in case where show cause notices have been issued on the same issue answerable to different adjudicating authorities all the show cause notices involving the same issue will be adjudicated by the adjudicating authority competent to decide the cases involving the highest amount of duty. Thus the Tribunal has merely given effect to the above referred Circular of CBEC and remanded the matter to the adjudicating authority competent to decide the cases involving highest amount of duty and as such it is not possible to state that the Tribunal has committed any legal error so as to warrant interference.

Summary

Issues:
1. Remanding the matter for de novo adjudication.
2. Violation of principles of natural justice.
3. Adjudication of show cause notices involving the same issue by the competent authority.

Issue 1: Remanding the matter for de novo adjudication
The case involved a dispute where the Commissioner of Central Excise and Customs challenged an order made by the Tribunal, questioning the remand of the matter for de novo adjudication. The Tribunal remanded the case to the Commissioner, Central Excise, Daman, instead of the Joint Commissioner, Central Excise and Customs, who was the adjudicating authority in the present case. The appellant contended that the Tribunal's decision to remand the matter was erroneous as the two show cause notices, although linked, pertained to different issues. The appellant argued that separate proceedings initiated based on two different show cause notices should be decided separately. The Tribunal's decision was challenged on the grounds that it was not justified in remanding the matter to the Commissioner, Central Excise and Customs, Daman. The appellant sought admission of the appeal based on the proposed questions of law for determination by the Court.

Issue 2: Violation of principles of natural justice
The case highlighted a violation of principles of natural justice concerning the denial of an opportunity to cross-examine witnesses by the adjudicating authority. The Commissioner (Appeals) found that the denial of cross-examination amounted to a violation of natural justice and remanded the matter for fresh adjudication after allowing cross-examination. The Tribunal, in the appeal by the revenue, modified the Commissioner (Appeals) order, remanding the matter to the Commissioner, Central Excise, Daman, to adjudicate both cases together. The Tribunal's decision was based on a CBEC Circular clarifying that show cause notices involving the same issue should be adjudicated by the authority competent to decide cases involving the highest amount of duty. The Tribunal's decision to remand the matter to the competent authority was deemed appropriate and in line with the legal guidelines, indicating no legal error warranting interference.

Issue 3: Adjudication of show cause notices involving the same issue by the competent authority
The case involved multiple show cause notices on the same issue answered by different adjudicating authorities. The Tribunal followed the CBEC Circular, which stated that all show cause notices involving the same issue should be adjudicated by the authority competent to decide cases involving the highest amount of duty. The Tribunal's decision to remand the matter to the adjudicating authority competent to decide cases involving the highest amount of duty was considered appropriate and in compliance with the legal guidelines, indicating no legal error necessitating intervention.