2016 (4) TMI 766 - HC - Customs

Validity of Tribunal s order - Non compliance with principles of natural justice and made error in not reading into evidence the opinion of Indian Institute of Technology though a copy of its report was on its file - Held that - Tribunal s order is vitiated for want of consideration of a vital and valid ground of appeal i.e. non compliance with principles of natural justice and a patent error in not reading into evidence the opinion of Indian Institute of Technology though a copy of its report was on its file. That ground was squarely raised in the Memo and pressed during the oral arguments. The Appellants should have been given complete opportunity to press that ground on merits and non furnishing of such an opportunity, therefore, results in Tribunal s order being ex-facie illegal. It is vitiated by an error apparent on the face of the record. Therefore, the order is quashed and set aside. - Appeal disposed of

Summary

Issues:
1. Compliance with principles of natural justice in the adjudication process.
2. Consideration of the report from the Indian Institute of Technology (IIT) in the decision-making process.

Issue 1: Compliance with principles of natural justice in the adjudication process

The case involved an appeal against an order passed by the Adjudicating Authority, which was challenged before the Customs, Excise & Service Tax Appellate Tribunal on grounds of non-compliance with principles of natural justice. The Tribunal's order dated 11th June, 2009 was impugned in the appeal. The Appellants contended that the Tribunal failed to apply its mind to a crucial issue. The Tribunal found that although the statement was not given to the Appellant's predecessor-in-title along with the show cause notice, it assumed that the predecessor had full knowledge of its contents. The Tribunal also noted the retraction of the statement by the predecessor-in-title but concluded that not supplying a copy of the statement did not result in a miscarriage of justice. The Tribunal's reasoning was based on attributing knowledge of the statement's contents to the predecessor-in-title, leading to the rejection of the first ground raised.

Issue 2: Consideration of the report from the Indian Institute of Technology (IIT) in the decision-making process

The Appellants argued that the Tribunal erred in not considering the report from IIT, which was supplied along with the reply to the show cause notice. The Tribunal's detailed discussion led to the conclusion that the failure to consider the IIT report vitally affected the conclusion reached by the Adjudicating Authority. The Appellants claimed that they had submitted a copy of the report along with a letter dated 3rd July, 2008. However, the Tribunal found that the records did not indicate the submission of the IIT report along with the reply. After inspecting the original records, it was revealed that the report from IIT was indeed forwarded to the Adjudicating Authority. The Revenue argued that although a letter was issued, the report was not in their file but with another section in the Customs Department.

The High Court, after considering the submissions and inspecting the records, found that the report from IIT had been forwarded to the Adjudicating Authority. The Court criticized the Tribunal for not considering this crucial document, which was essential for a fair adjudication process. The Court held that the Tribunal's order was vitiated by not considering this vital ground of appeal. Consequently, the Court quashed the order of the Tribunal and restored the appeal to its file for fresh consideration. The Court directed the Tribunal to allow the parties to raise the ground of non-compliance with principles of natural justice and to consider the impact of the IIT report on the case. The Court emphasized the importance of a thorough and fair consideration of all relevant documents for a just decision.