2009 (2) TMI 213 - AT - Service Tax

Personal hearing natural justice - Against such ex parte order, the Appellants submitted an application to that commissioner (appeal) for modification of the same. He draws our attention to page-67 which is modification application dated 7-8-08 for modification of the stay order. He submits that when such modification application was filed without the appellant being heard on that application, its appeal was dismissed. But the Appellant having fair chance of success on merits of its case, he prays that it should at least be heard following principles of natural justice by the authority who shall do justice to the Appellant held that appeal restored before the commissioner (appeal) with direction.

Summary

Issues:
1. Denial of opportunity of hearing on modification application leading to dismissal of appeal.
2. Violation of principles of natural justice.
3. Disposal of appeal without deciding on merit.

Analysis:
1. The appeal before the Appellate Tribunal arose from a pre-deposit order passed ex parte by the learned Commissioner (Appeals). The Appellants had submitted a modification application to the Authority for the same. The Authorized Representative contended that the appeal was dismissed without hearing the modification application, despite the Appellant having a fair chance of success on the merits of the case. The request was made for the Appellant to be heard following principles of natural justice by the authority. The Tribunal noted the pendency of the modification application and disagreed with the decision of the Authority below, stating that the Appellant had not been given an opportunity for a hearing on the modification application, leading to a violation of natural justice principles.

2. The Departmental Representative confirmed the factual position but stated that the Appellant was heard by the Authority below and was not denied an opportunity for a hearing. However, the Tribunal, after hearing both sides and perusing the record, agreed with the Authorized Representative for the Appellant that there was a lack of opportunity for hearing on the modification application. The Tribunal opined that in the interest of justice, the Commissioner should have given the Appellant a chance for a hearing on the modification application and then proceeded with the disposal of the appeal. The Tribunal found that the Appellant had been deprived of justice and there was a clear violation of the principles of natural justice.

3. Consequently, the Tribunal dispensed with the pre-deposit and dismissed the appeal on the grounds that the Appellant's case was not decided on merit by the Appellate Authority below. The Tribunal directed the Appellant to appear before the Appellate Authority to have the matter heard afresh on both merit and the issue of pre-deposit in accordance with the law. The Appellant was instructed to submit an application to the Authority indicating readiness for the hearing, with the Commissioner fixing an appropriate date for the hearing to ensure justice to the litigants. The stay application and appeal were disposed of as per the directions provided by the Tribunal.