2017 (5) TMI 516 - HC - Central Excise

Maintainability of appeal - jurisdiction - alternate remedy of appeal - petitioners have invoked the writ jurisdiction of this court mainly on two grounds, namely, that the SCN which forms the basis of the impugned order-in-original is without jurisdiction and further that the impugned order-in-original has been passed in breach of the principles of natural justice - Held that - it is noteworthy that the SCN is dated 30.3.2007 and the circulars on which reliance has been placed are dated 10th March, 1995 which was in existence when the SCN came to be issued. Thus, at the relevant time itself, the petitioners had an opportunity to challenge the SCN on the ground of lack of jurisdiction. However, the petitioners did not choose to do so and now seek to directly challenge the show cause notice after the same has been adjudicated by the impugned order in original - after a period of ten years, the petitioners cannot be permitted to invoke the writ jurisdiction of this court on the ground that the SCN is without jurisdiction. Insofar as the breach of principles of natural justice is concerned, a perusal of the paragraph 3 of the impugned order-in-original reveals that several notices had been sent to the petitioners through speed post, which were delivered to the petitioners. In all, it appears that seven hearing notices were issued to the petitioners, out of which, at least four were served upon the petitioners. However, the petitioners failed to appear in any of the scheduled hearings and failed to, in any manner, respond to the said notices - this court is of the view that the petitioners are not entitled to invoke the extraordinary writ jurisdiction of this court under Article 226 of the Constitution of India leaving it open for the petitioners to avail of the alternative remedy of appeal before the Tribunal. Petition dismissed as not maintainable in view of the availability of an equally efficacious remedy by way of appeal before the Tribunal - decided against petitioner.

Summary

Issues:
Challenge to show cause notice jurisdiction and breach of natural justice in passing the order-in-original.

Analysis:
1. Challenge to Show Cause Notice Jurisdiction:
- The petitioners argued that the show cause notice lacked jurisdiction due to Circular No.21/95-Customs and Circular No.12/2008-Cus provisions regarding export obligation fulfillment and duty recovery.
- They contended that since the Development Commissioner extended the export obligation period, no cause for duty demand existed, making the show cause notice jurisdictionally flawed.
- Additionally, the petitioners highlighted a delay of ten years in passing the order-in-original without reasons, citing a court decision emphasizing timely adjudication to avoid vitiating proceedings.
- The petitioners' reply to the show cause notice was allegedly disregarded, and the order-in-original was passed without hearing them, violating principles of natural justice.

2. Breach of Natural Justice in Passing Order-in-Original:
- The order-in-original was challenged for breaching natural justice principles, as the petitioners claimed they were not heard during the process.
- The court noted that multiple hearing notices were sent to the petitioners, with several being served, but the petitioners failed to respond or appear at any scheduled hearings.
- Due to the petitioners' non-compliance with the notices and hearings, the court found it inappropriate to entertain their petition under Article 226 of the Constitution of India.
- The court concluded that the petitioners had an alternative remedy of appeal before the Tribunal, emphasizing that the High Court should not condone petitioners' default in responding to statutory authorities.

In the final judgment, the court dismissed the petition as not maintainable, citing the availability of an equally efficacious remedy through an appeal before the Tribunal. The court clarified that it did not assess the impugned order-in-original on its merits, instructing the Tribunal not to be influenced by any observations made in the dismissal order while deciding on any potential appeal filed by the petitioners.