2011 (8) TMI 540 - HC - Central Excise

Territorial jurisdiction - assessee affected by an assessment order in Bombay may invoke the jurisdiction of the Delhi High Court to take advantage of the law laid down by it which may be contrary to judgments of the High Court of Bombay. This cannot be allowed - Held that - place where the cause of action had arisen and where the original adjudication had taken place which would constitute forum conveniens for all the parties concerned, Court has no territorial jurisdiction to entertain the appeals,

Issues Involved:
1. Territorial jurisdiction of the Delhi High Court to entertain the appeals.
2. Applicability of the doctrine of forum conveniens.
3. Interpretation of Section 35G of the Central Excise Act, 1944 in relation to territorial jurisdiction.
4. Relevance of the situs of the appellate authority in determining jurisdiction.

Issue-wise Detailed Analysis:

1. Territorial Jurisdiction of the Delhi High Court:
The primary issue was whether the Delhi High Court had territorial jurisdiction to entertain the appeals. The appellant's manufacturing unit was situated in Himachal Pradesh, and the show cause notices and adjudication orders were issued by authorities in Himachal Pradesh. The respondent argued that the jurisdiction should be determined based on where the cause of action arose, i.e., Himachal Pradesh, and not merely because the Tribunal is situated in Delhi. The court referred to the judgment in M/s. Sterling Agro Industries Ltd. Vs. Union of India & Ors., which emphasized that the location of the Tribunal does not confer jurisdiction on the High Court where the Tribunal is situated.

2. Applicability of the Doctrine of Forum Conveniens:
The court discussed the concept of forum conveniens, which means that a case should be heard in the court most convenient for all parties involved. The doctrine includes factors such as the location of parties, witnesses, and the applicable law. The judgment in M/s. Sterling Agro Industries Ltd. clarified that the mere situs of the appellate authority does not determine jurisdiction; instead, the convenience of the forum should be considered. The court concluded that the Delhi High Court was not the appropriate forum based on the doctrine of forum conveniens.

3. Interpretation of Section 35G of the Central Excise Act, 1944:
The appellant argued that appeals under Section 35G should be governed by the provisions of the Code of Civil Procedure (CPC), specifically Section 100, which allows appeals to the High Court from orders passed by any court subordinate to the High Court. The court, however, referred to the Supreme Court's judgment in Ambica Industries Vs. Commissioner of Central Excise, which held that the situs of the Tribunal is not the determinative factor for jurisdiction. The court emphasized that the jurisdiction should be based on the statutory provisions and the location where the cause of action arose.

4. Relevance of the Situs of the Appellate Authority:
The court reiterated that the location of the Tribunal or appellate authority does not confer jurisdiction on the High Court where the Tribunal is situated. The judgment in Ambica Industries was cited, which clarified that the situs of the Tribunal is not a determinative factor for jurisdiction, as it could lead to forum shopping and judicial anarchy. The court held that the jurisdiction should be determined based on where the cause of action arose and the forum conveniens.

Conclusion:
The court concluded that the Delhi High Court did not have territorial jurisdiction to entertain the appeals. The appeals were dismissed, accepting the preliminary objection raised by the respondent regarding jurisdiction. The court emphasized the importance of the doctrine of forum conveniens and the need to determine jurisdiction based on the location where the cause of action arose, rather than the situs of the appellate authority.

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