2013 (4) TMI 278 - HC - Central Excise

Writ petition against the decision of CESTAT remanding the matter back - principal of natural justice - alternative remedy of appeal under Section 35G - held that - With the greatest of respect to the learned Tribunal, it is absolutely shocking that an appeal should be remitted on the sole ground that the Department had questioned the legality and the propriety of the order impugned. The earlier order dated 8th January, 2008 of the learned Tribunal, on which reliance has been placed, was an order by consent in a case where both the department and the assessee had appealed. The order impugned smacks of perversity and is violative of principles of natural justice, in that the entire decision is on the ground of the department having questioned the order. It is unfortunate that the learned Tribunal should have converted itself to a departmental Tribunal giving total go by to the principles of fair play in action. The impugned order is set aside and quashed. The Tribunal shall decide the appeal afresh in accordance with law expeditiously preferably within two months from the date of communication of this order.

Summary

Issues:
Challenge to order remanding the matter to the Original Authority for a fresh decision based on the Department's questioning of the legality and propriety of the impugned order. Preliminary objection raised regarding the existence of an alternative remedy of appeal under Section 35G of the Central Excise Act, 1944.

Analysis:

Issue 1: Challenge to order remanding the matter
The High Court scrutinized the order remanding the matter to the Original Authority for a fresh decision due to the Department's challenge to the legality and propriety of the impugned order. The Court expressed shock that an appeal was remitted solely based on the Department's objections. It highlighted a previous order by the Tribunal, emphasizing that it was based on mutual appeals by both the Department and the assessee. The Court noted that the order in question lacked a fair consideration of the grounds of appeal advanced by the Appellants (Assessees).

Issue 2: Existence of an alternative remedy
The Respondent raised a preliminary objection regarding the availability of an alternative remedy of appeal under Section 35G of the Central Excise Act, 1944. The Court examined Section 35G(1) which specifies the conditions for an appeal to the High Court, emphasizing the requirement of a substantial question of law. It deliberated on the lack of a clear right of appeal in the case at hand and discussed the exceptions to the rule of alternative remedy, such as violations of natural justice and perversity. The Court concluded that the impugned order was violative of natural justice and principles of fair play, leading to its setting aside and quashing.

Final Decision:
The High Court set aside and quashed the impugned order, directing the Tribunal to decide the appeal afresh in accordance with the law, preferably within two months. Both appeals by the Department and the petitioner were to be heard and disposed of together. The Court clarified that it did not delve into the merits of the contentions of the parties before the Tribunal. Additionally, urgent certified copies of the order were to be provided to the parties upon application.

This comprehensive analysis of the judgment showcases the Court's detailed examination of the issues at hand and its decision-making process in addressing the legal complexities involved.