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2012 (12) TMI 533 - AT - Central ExcisePower of Commissioner to remand the matter to the adjudicating authority for fresh adjudication - setting aside of Demand of Duty, Interest and Penalty - Held that - If the order in original is passed without giving opportunity of being heard to the assessee or without permitting him to produce evidence in support of his case then only order with the Commissioner (Appeals) would be able to pass him to set aside the impugned order on the ground of failure of justice. This would create an anomaly with prejudice to the Revenue as it would bring an end to the litigation without adjudicating on the demand raised by the show cause notice. Therefore, just and proper order in such a case would be nothing but an order of remand to adjudicate the matter denovo after giving due hearing to the assessee - it is apparent that Commisioner(A) have power to remand the matter back to original adjudicating authority even after amendment of Sec 35A(3). As decided in COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD-I Versus MEDICO LABS 2004 (9) TMI 108 - HIGH COURT OF GUJARAT AT AHMEDABAD that Commissioner (Appeals) continues to have power of remand even after the amendment of Section 35A(3) of the Central Excise Act, 1944 by Finance Act, 2001 w.e.f. 11.5.2001 - no merit in appeal filed by the department.
Issues:
1. Interpretation of Section 35A of the Central Excise Act post-amendment in May 2001 regarding the Commissioner's power to remand the matter for fresh adjudication. Analysis: The appeal challenged an order by the Commissioner (Appeals) remanding a duty demand case for denovo adjudication. The main issue revolved around the Commissioner's power post-amendment in Section 35A of the Central Excise Act by the Finance Act 2001. The appellant argued that the Commissioner's power to remand was taken away by the amendment, citing a Supreme Court judgment. On the other hand, the respondent relied on a High Court judgment stating that the Commissioner (Appeals) retained the power to remand even after the amendment. The Tribunal analyzed the relevant provisions of the Customs Act, 1962, and the Excise Act, along with the judgments cited by both parties. It highlighted the similarity in language between Section 128A(2) of the Customs Act and Section 35A(3) of the Excise Act, both defining the powers of the Commissioner (Appeals) to pass just and proper orders after necessary inquiry. Referring to a Supreme Court judgment in a different case, the Tribunal emphasized that the power to remand the matter for fresh decision is inherent in the appellate authority's powers. It noted that the Supreme Court's observation in another case, regarding the amendment withdrawing the power of remand, was a passing remark and should not override the interpretation of the provision itself. The Tribunal also cited a Gujarat High Court judgment supporting the continued power of the Commissioner (Appeals) to remand post-amendment. It highlighted that Section 35A(3) allows the Commissioner (Appeals) to annul the original order and pass a just and proper order, which may include remanding the matter for fresh adjudication in certain circumstances, such as failure of justice or lack of opportunity for the assessee to present evidence. Ultimately, the Tribunal concluded that the Commissioner (Appeals) retained the power to remand the matter back to the original adjudicating authority even after the 2001 amendment. Consequently, the appeal filed by the department was dismissed, affirming the Commissioner's authority to remand cases for fresh adjudication when deemed necessary.
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