2017 (8) TMI 104 - HC - Central Excise

Principles of Natural Justice - Shortage of MS Ignots - difference between the book stock and the physical stock - whether the petitioner should be granted an opportunity to go before the respondent by directing a de-novo proceedings to be conducted on the ground that they did not file their reply to the show cause notices and were not afforded an opportunity of personal hearing? - maintainability of petition - Held that - this is not a case, where the petitioner has not been afforded reasonable opportunity to putforth their submission, but it is a case of deliberate failure on the part of the petitioner to avail the opportunity granted to them. The petitioner places much reliance on the floods, which affected the Chennai City in December 2015. However, the record of proceedings show that the proceedings commenced much earlier and all the documents were taken from the factory of the petitioner, which was not at Chennai, but at Karaikal and the respondent Commissionerate functioned from Trichirappalli and the request made by the petitioner were complied with. However, it is alleged by the petitioner, the documents collected from the respondent, were sent to the head office at Chennai. It appears that this stand has not been substantiated before the respondent nor before this Court by way of any documents. The facts would lead to irresistible conclusion that the petitioner, despite having knowledge of the proceedings, did not choose to submit their reply to the show cause notices, inspite of sufficient indulgence granted to them. Thus, the fault lies with the petitioner and they cannot claim that it is a case of violation of principles of natural justice. This Court is not inclined to entertain the Writ Petitions challenging the Order-in-Original on the ground that the petitioner has an effective alternate remedy before the CESTAT under Section 35G of the CEA, 1944 - petition dismissed being not maintainable.

Issues:
1. Violation of principles of natural justice and audi alteram partem.
2. Double duty imposition on the same shortage of raw materials.
3. Failure to provide an opportunity for personal hearing.
4. Alleged arbitrary demand raised by adopting electricity consumption charges.
5. Availability of an effective alternative remedy before the CESTAT under Section 35G of the Central Excise Act.

Issue 1: Violation of principles of natural justice and audi alteram partem:
The petitioner challenged the Order-in-Original on the grounds of violation of principles of natural justice and audi alteram partem. The petitioner contended that the respondent did not consider their letters and representations, and that double duty was imposed on the same shortage of raw materials. The petitioner argued that the respondent passed the order without granting an opportunity for a personal hearing, which is a violation of natural justice principles.

Issue 2: Double duty imposition on the same shortage of raw materials:
The petitioner raised concerns about the imposition of double duty on the same shortage of raw materials, which they deemed a violation of natural justice. The petitioner highlighted the excess payments made towards duty and argued that imposing duty again on the shortage of raw material amounted to double taxation on the same issue.

Issue 3: Failure to provide an opportunity for personal hearing:
The petitioner claimed that they were not given a fair opportunity for a personal hearing. Despite multiple requests for rescheduling due to unforeseen circumstances like floods damaging their documents, the respondent proceeded with the Order-in-Original without granting a proper opportunity for the petitioner to present their case.

Issue 4: Alleged arbitrary demand raised by adopting electricity consumption charges:
The petitioner contended that the demand was raised arbitrarily by including electricity consumption charges. This raised concerns about the validity and fairness of the charges imposed by the respondent, indicating a lack of transparency in the assessment process.

Issue 5: Availability of an effective alternative remedy before the CESTAT under Section 35G:
The Court noted that the petitioner had an effective alternative remedy available before the CESTAT under Section 35G of the Central Excise Act. The Court emphasized the importance of utilizing the statutory appeal process provided by law and directed the petitioner to pursue their case through the appropriate appellate tribunal rather than seeking relief through writ petitions.

In conclusion, the Court dismissed the Writ Petitions as not maintainable, citing the availability of an effective alternative remedy before the CESTAT. The Court granted the petitioner the liberty to move the Tribunal by way of appeal, with a specified exclusion period for computing limitation and a temporary stay on coercive actions by the respondent. No costs were awarded in the matter, and the Court closed the connected Miscellaneous Petitions.

← Previous Next →