2017 (5) TMI 659 - HC - Customs

Restoration of appeal - Held that - the petitioner had made out sufficient cause for not remaining present when the order dated 23.2.2016 was passed, and hence, the Appellate Tribunal was not justified in not recalling its earlier order and restoring the appeal preferred by the petitioner. The court is of the view that sufficient cause has been made out by the petitioner for not remaining present before the Appellate Tribunal, either personally or through its representative, on the date when the ex parte order came to be passed. Petition allowed - the appeal is restored to the file of the Appellate Tribunal which shall be heard and disposed of on merits.

Summary

Issues Involved:
1. Legality of the ex parte order dated 23.2.2016 passed by the Appellate Tribunal.
2. Whether the Appellate Tribunal had the power to recall its ex parte order.
3. Whether the petitioner had sufficient cause for non-appearance on the specified dates.
4. Adequacy of the reasoning provided by the Appellate Tribunal in its order dated 23.2.2016.
5. Whether the impugned order dated 25.1.2017 by the Appellate Tribunal was justified.

Issue-wise Detailed Analysis:

1. Legality of the ex parte order dated 23.2.2016 passed by the Appellate Tribunal:
The petitioner contended that the ex parte order dated 23.2.2016 was based on incorrect facts, specifically that the advocate for the petitioner was present on the dates mentioned but was not marked as present due to procedural issues. The High Court found that the order dated 23.2.2016 was a non-reasoned and non-speaking order, lacking any analysis or discussion on the merits of the appeal, thereby questioning its legality.

2. Whether the Appellate Tribunal had the power to recall its ex parte order:
The Appellate Tribunal had rejected the application for recalling the ex parte order on the grounds that it had become functus officio. However, the High Court referred to the Supreme Court's decision in J.K. Synthetics Ltd. v. Collector of Central Excise, which held that the Tribunal has the power under Rule 41 of the CEGAT (Procedure) Rules to set aside an ex parte order if it is found that the respondent had, for sufficient cause, been unable to appear. Therefore, the Appellate Tribunal's stance was contradictory to established legal principles.

3. Whether the petitioner had sufficient cause for non-appearance on the specified dates:
The petitioner provided detailed reasons for non-appearance, including miscommunication about the Tribunal's availability and procedural errors in marking presence. The High Court found these reasons to constitute sufficient cause for non-appearance, thereby justifying the petitioner's request for recalling the ex parte order.

4. Adequacy of the reasoning provided by the Appellate Tribunal in its order dated 23.2.2016:
The High Court noted that the order dated 23.2.2016 lacked any substantive analysis or independent findings and merely reiterated the observations of the adjudicating authority and the Commissioner (Appeals). This lack of reasoning rendered the order inadequate and non-speaking, failing to address the merits of the petitioner's appeal.

5. Whether the impugned order dated 25.1.2017 by the Appellate Tribunal was justified:
The Appellate Tribunal had rejected the petitioner's applications for recall and rectification based on the continuous absence of the petitioner's representative and its functus officio status. The High Court found that the Tribunal's reasoning was flawed and not supported by the facts or legal principles. Consequently, the impugned order dated 25.1.2017 was quashed and set aside.

Conclusion:
The High Court allowed the petition, quashed the impugned order dated 25.1.2017, and recalled the ex parte order dated 23.2.2016. The appeal was restored to the file of the Appellate Tribunal for a hearing on merits. The High Court clarified that it had not expressed an opinion on the merits of the appeal itself. The rule was made absolute with no order as to costs.