2014 (2) TMI 162 - AT - Central Excise

Penalty under Rule 26 of the Central Excise Rules, 2002 and Rule 209A of the Central Excise Rules, 1944 - violation of principles of natural justice - Held that - relied upon documents were not sent by the Revenue at the known postal address of the appellants and the same were being called for from the office of the adjudicating authority, Assistant Commissioner, Division III, Surat vide letter F. No. (Ch.54)15-02/OA/2003 dated 26.02.2009. Accordingly, the case is required to be remanded back to the original adjudicating authority for deciding the matter in de-novo proceedings after providing the relied upon documents and opportunity of personal hearing to the appellants. However, the main appellant is also required to be put to certain condition so that appellants also co-operate in the adjudication proceedings in a time bound manner without any further delay - Decided partly in favour of assessee.

Summary

Issues Involved:
Stay applications and appeals filed against OIO confirming demand, interest, and penalties due to alleged violation of principles of natural justice regarding notice of hearing not received by appellants.

Analysis:
The appellants contended that orders confirming demand and penalties were passed in violation of natural justice as they did not receive the notice of hearing. The main appellant claimed lack of control over the premises due to Revenue's attachment. Case laws were cited to support the argument. Correspondence exchanged between the parties was submitted, requesting a remand to the original adjudicating authority for a fair hearing.

The Revenue highlighted letters from the main appellant responding from the same address used for sending notices, indicating a mechanism for communication. The absence of a change of address by the appellants was emphasized, suggesting that they had the opportunity to receive communications. The bench considered the communication history and found the appellant's claim of non-receipt of notices since 2005 invalid, as no change of address was provided to the adjudicating authority.

After reviewing the case records, the bench concluded that the appellants were attempting to delay the resolution of the issue raised in the show cause notice since 2005. The cited case laws were deemed inapplicable to the current proceedings. The appeals were taken up for disposal after allowing the stay applications.

The bench noted that relied upon documents were not sent to the appellants' known address and needed to be obtained from the adjudicating authority for a fair decision. The case was remanded to the original authority for de-novo proceedings, with the main appellant directed to make a pre-deposit of Rs. 50,00,000 within eight weeks. Compliance with the payment was required for the authority to proceed with a fresh adjudication following the principles of natural justice.

In conclusion, the appeals were allowed by way of remand, subject to the conditions imposed on the main appellant for cooperation in the adjudication proceedings without further delay.