2016 (6) TMI 224 - AT - Customs

Confiscation of goods and imposition of penalty - Violation of principles of natural justice - reasonable opportunity of being heard not afforded - variation in the declaration made by the assessee in the shipping bills and goods found loaded in the trucks. Held that - whatever may be the reason for appellant for not placing the defence reply on record and not contesting the issue on merits the fact remains the said reply is not on the record. As such it can be safely concluded that the impugned order stands passed ex partee. Though we also note that though the appellant made a prayer in writing and also at the time of hearing that the proceedings may be kept in abeyance and when such a request was made by the assessee was not accepted, he was under the legal obligation to intimate about the same to the assessee so as to enable them to put forth their defence on record. In such a scenario we are of the view that the impugned order stands passed in violation of principle of natural justice and is required to be set aside on the said ground. Accordingly, impugned order is set aside and remanded the matter back to the adjudicating authority for fresh decision. - Appeals allowed by way of remand

Summary

Issues: Violation of principle of natural justice in passing an ex parte order without affording a reasonable opportunity to the appellant.

In this case, the appellant, located in a Special Economic Zone (SEZ), filed shipping bills for the export of general hardware. However, discrepancies were found between the goods declared in the shipping bills and those intercepted at the SEZ gate. Consequently, proceedings were initiated against the appellant for confiscation of goods and imposition of penalties, leading to the impugned order by the Commissioner.

The appellant contended that they had not filed a defense reply before the adjudicating authority and had requested to keep the proceedings in abeyance until related investigations concluded. Despite this, the adjudicating authority did not inform the appellant of the decision to proceed and passed the impugned order in the absence of a reply from the appellant.

The appellant argued that had they been informed about the decision to proceed, they would have filed a reply and contested the case on merits. The absence of a defense reply on record led to the conclusion that the impugned order was passed ex parte, violating the principle of natural justice. The Tribunal noted that the appellant's request to keep the proceedings in abeyance was not accepted, and the adjudicating authority failed to inform the appellant, depriving them of the opportunity to present their defense.

Considering the submissions from both sides, the Tribunal held that the impugned order was passed in violation of the principle of natural justice and set it aside. The matter was remanded to the adjudicating authority for a fresh decision, emphasizing that the appellant should be given a reasonable opportunity to contest the liability on merits. As a result, all four appeals were allowed by way of remand, ensuring fairness and adherence to procedural justice.