2014 (12) TMI 370 - AT - Central Excise

Validity of order passed - Opportunity for hearing not granted - Held that - Commissioner (Appeals) observed that the appellant (respondent therein) had not filed any cross objection to the appeal filed by the Revenue and, therefore, Department s version remains unrebutted and, therefore, survives. We are unable to accept such a reasoning of the impugned order. Section 35A(3) of Central Excise Act, 1944 provides that the Commissioner (Appeals) shall, after making such further enquiry as may be necessary, pass such order, as he thinks just and proper, confirming, modifying or annulling the decision or appealed against. Sub-Section (4) of Section 35A of the said Act, 1944 provides that the order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision therefor and the reason for the decision. Thus, it is a statutory duty of the Commissioner (Appeals) to give reasons, which cannot be discharged by use of vague words. It requires proper, adequate reasons on the basis of material on record as available. while disposing the Department s appeal, the Commissioner (Appeals) should have examined the grounds of appeal and relevant records as available and state the points for determination and give the reasons for the decision. Commissioner (Appeals) allowed the appeal of the department only on the ground that the Respondents had not filed any cross objection, which cannot be a good reason - Matter remanded back - Decided in favour of assessee.

Issues:
1. Early hearing application dismissal.
2. Sufficient opportunity of hearing not extended.
3. Failure to provide proper reasoning in the impugned order.
4. Commissioner (Appeals) not examining grounds of appeal and relevant records.
5. Remand of the matter for a fresh decision.

Issue 1: Early hearing application dismissal
The appellant filed an application for early hearing of the appeal, which was dismissed as infructuous by the Tribunal with the consent of both sides.

Issue 2: Sufficient opportunity of hearing not extended
The main contention was that the appellant did not receive sufficient opportunity of hearing. The Tribunal noted that the matter was remanded to the original authority for fresh decision. The adjudicating authority confirmed the demand of differential duty, which was already paid by the appellant. The Commissioner (Appeals) set aside the adjudication order and accepted the appeal filed by the Revenue. The appellant argued that they did not receive the notice for hearings as scheduled, and the Commissioner (Appeals) failed to provide proper reasoning as required by Section 35A(3) and (4) of the Central Excise Act, 1944.

Issue 3: Failure to provide proper reasoning in the impugned order
The Tribunal found that the impugned order lacked proper reasoning and failed to meet the statutory duty of the Commissioner (Appeals) to give detailed reasons based on the material on record. The Tribunal disagreed with the reasoning that the Department's version remained unrebutted due to the lack of cross objection by the appellant.

Issue 4: Commissioner (Appeals) not examining grounds of appeal and relevant records
The Tribunal observed that the Commissioner (Appeals) should have examined the grounds of appeal and relevant records to determine the points and provide reasons for the decision. The decision to allow the appeal of the department solely based on the absence of a cross objection by the respondent was deemed insufficient.

Issue 5: Remand of the matter for a fresh decision
Considering the above issues, the Tribunal set aside the impugned order and remanded the matter back to the Commissioner (Appeals) for a fresh decision. The Commissioner (Appeals) was instructed to provide proper opportunity of hearing to the respondent in accordance with the statutory requirements. The appeal was allowed by way of remand.

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