2012 (8) TMI 788 - SC - Central Excise

Whether no provision in the Act empowering the Board to issue directions to the Assessing Authorities or the Appellate Authorities in the matter of deciding disputes between the persons who are called upon to pay duty and the department Held that - Such orders are required to be passed by exercising independent mind and without impartiality and while doing so, such Authorities are required to consider various evidences made available to them - Circulars issued by the Department which are in the nature of guidance to such Authorities and, therefore the contents of such circulars could also be considered as evidence available before them - Assessing Authority has come to an independent finding on its own and therefore matter remanded to Assessing Authority to consider the matters afresh

Summary

Issues:
Appeal against quashing of Circular No. 8/2006 Customs by High Courts; Whether Circulars issued under the Statute are statutory; Nature of items imported by the Appellant; Quasi-judicial powers of Assessing Authorities; Independence and impartiality of Quasi-judicial Authorities; Consideration of Circulars as evidence; Directions to Assessing Authority for fresh consideration.

Analysis:
The Supreme Court dealt with appeals challenging the quashing of Circular No. 8/2006 Customs by two High Courts. The issue revolved around the legality of the Circular and whether it was beyond the powers of the Central Board of Excise and Customs under Section 151-A of the Act. The Court noted that Circulars issued under the Statute are considered statutory and cannot be arbitrarily quashed by the High Courts.

Regarding the nature of the items imported by the Appellant, the High Courts had to determine whether they were "used steel rails" or "waste/scrap." This factual question required assessment by the authorities under the Act. The High Court emphasized the quasi-judicial nature of the Assessing Authority's functions and the need for impartiality in decision-making by the Appellate and Revisional Authorities.

The Supreme Court reiterated that Assessing Authorities, as well as Appellate and Revisional Authorities, function as quasi-judicial bodies under the Act. Their orders are considered quasi-judicial and must be made independently and impartially. The Court highlighted that Circulars issued by the Department serve as guidance to these Authorities and can be treated as evidence in their decision-making process.

The Court directed the Assessing Authority to reconsider the matters independently and afresh, based on the evidence available, including the Circulars. The orders of the High Court were modified to allow the Authorities to make decisions autonomously. The Court refrained from expressing any opinion on the merits of the claims put forth by the parties, leaving it to the Authorities to decide.

Furthermore, the parties were permitted to raise all relevant issues in accordance with the law during the fresh consideration by the Assessing Authority. The judgment emphasized the importance of independent decision-making by quasi-judicial bodies and the consideration of all available evidence, including departmental Circulars, in reaching conclusions.