2013 (4) TMI 435 - AT - Central Excise

Waiver of pre-deposit of duty/interest/penalty - violation of principles natural justice as the lower authorities did not give copies of the seized documents but granted personal hearing - Revenue submits that despite there being three opportunities given to appellant, he had sought an adjournment. Held that - Since we are not happy with the conduct of the appellants, in order to ensure that the main appellant and other appellants appear before the adjudicating authority and cooperate in the proceedings, we direct the main appellant to deposit an amount of Rs. 5 lacs within four weeks from the date of receipt of certified copy of this order and produce evidence before the adjudicating authority. appeals are allowed by way of remand.

Summary

Issues involved:
1. Waiver of pre-deposit of duty amount confirmed with interest and penalty.
2. Violation of principles of natural justice at the adjudicating authority level.
3. Whether the activity conducted by the appellant amounts to manufacturing.
4. Conduct of the appellant in seeking adjournments and cooperation in proceedings.

Analysis:

Issue 1: Waiver of pre-deposit
The judgment addresses the stay petitions filed for the waiver of pre-deposit of duty amount confirmed with interest and penalty. The Tribunal found a violation of principles of natural justice at the adjudicating authority level. The application for the waiver of pre-deposit was allowed, and the appeals themselves were taken up for disposal.

Issue 2: Violation of principles of natural justice
The appellant argued that there was a violation of principles of natural justice as the show cause notice was issued, but the appellant was not given copies of the seized documents and was not granted additional hearings despite requests. The Tribunal noted that the appellant's request for the documents relied upon by the department was crucial for defending their case, and the orders passed without providing necessary documents were held to be in violation of natural justice.

Issue 3: Manufacturing activity
The appellant raised the question of whether the activity conducted by them amounted to manufacturing. The Tribunal did not express any opinion on the merits of the case and left all issues open for the adjudicating authority to consider, indicating that this issue was to be addressed during further proceedings.

Issue 4: Conduct of the appellant
The judgment highlighted the unsatisfactory conduct of the appellant in seeking adjournments of personal hearings granted by the adjudicating authority. The Tribunal directed the appellant to cooperate in the proceedings, reply to the show cause notice, and deposit a specified amount within a given timeframe to ensure compliance and participation in the adjudication process.

In conclusion, the impugned orders were set aside, and the appeals were allowed by way of remand, with directions for the appellant to comply with specific requirements to proceed with the adjudication process effectively.