2013 (5) TMI 703 - HC - Central Excise

Revenue appeal - authorization by the committee of commissioners - held that - The method and manner, in which such authorisation is obtained, is not an issue on which the Tribunal could in the absence of any objection make an enquiry to arrive at a finding whether such authorisation was given in accordance with the law. There are no statutory rules, providing that the Commissioner will sit on the same day at the same time and take a decision authorising a Central Excise Officer to file the appeal. The decision would not suffer from any fatal error unless it is shown that the decision is obtained without application of mind by the Commissioners either sitting together or at different time or dates at different places. The appeal did not lack merits inasmuch as the question as to whether the penalty under Section 11AC of the Act can be levied when the duty is deposited prior to issuing show cause notice. The order dated 23-2-2010 dismissing the appeal and the order dated 31-3-2010 dismissing the recall application suffer from gross error of jurisdiction by the Tribunal in examining the validity of the authorisation, which it did not possess. - matter restored before tribunal - Decided in favor revenue.

Summary

Issues:
Appeal maintainability based on authorization by Committee of Commissioners of Central Excise.

Analysis:
The judgment pertains to two Central Excise appeals directed against the orders of the Customs, Excise and Service Tax Appellate Tribunal, New Delhi. The Tribunal dismissed the appeal as not maintainable, citing lack of authorization by the Committee of Commissioners of Central Excise. The Tribunal observed discrepancies in the authorization process, stating that the decision was not taken by the Committee on the same day, leading to doubts regarding ad idem. The Tribunal referred to a previous decision to support its stance. The Central Excise Department filed a recall application, which was also rejected. The Department argued that once an appeal is filed with authorization, the Tribunal cannot reject it on the grounds of lack of authorization. The Department produced the order of the Committee of Commissioners, signed on different dates, and explained that the order was issued by circulation. The Department emphasized that the Tribunal exceeded its jurisdiction by questioning the validity of the authorization without objections from the respondent.

In the absence of objections from the respondent, the Tribunal's scrutiny of the authorization process was deemed improper. The Department highlighted that the Tribunal's role is to confirm, modify, or annul the decision appealed against, not to question the authorization process. The Department referred to a Supreme Court case emphasizing the importance of proper authorization for filing appeals to prevent frivolous appeals. The judgment noted that the Tribunal's focus on the timing of the Commissioners' decision exceeded the scope of authorization under the law. It was clarified that there are no statutory rules mandating Commissioners to decide on the same day simultaneously. The judgment also highlighted that the appeal had merit based on legal precedents regarding penalty imposition when duty is paid before a show cause notice. Ultimately, the High Court found that the Tribunal erred in examining the authorization's validity and lacked jurisdiction in doing so. Consequently, both appeals were allowed, and the orders of the Tribunal were set aside for a decision on merits in accordance with the law.