2018 (1) TMI 1268 - HC - Central Excise

Maintainability of appeal - rectification of mistake application - Whether respondent no. 2 i.e. the tribunal has erred in rejecting the appeal at the stage of final disposal of appeal without taking into consideration the fact that the appeal has already been admitted after compliance of part payment of duty amounting to 25, 544/- as per the stay order no. S/56/12/SMB/C-IV dated 1st May 2012? - Held that - In the present case the assessee pointed out that the appeal was already admitted. The proviso could not have been invoked in this case post admission. Therefore the appeal could not have been dismissed on the ground on which it has been dismissed namely without adjudication on merits - Once the appeal was admitted in this case and kept pending then no useful purpose is served by dismissing it at the final hearing on the ground of maintainability. Ultimately it is a discretion vesting in the tribunal which it must exercise judiciously and not capriciously. The order under appeal which would include the order on rectification of mistake application set aside - appeal is restored to the tribunal s file for adjudication on merits in accordance with law.

Summary

Issues:
1. Whether the tribunal erred in rejecting the appeal without considering compliance with part payment of duty?
2. Whether the tribunal erred in dismissing the appeal based on monetary limits under section 35B of the Central Excise Act, 1944?

Analysis:
1. The High Court analyzed the tribunal's decision to dismiss an appeal challenging the Commissioner of Central Excise's order based on monetary limits. The court highlighted that the tribunal relied on section 35B of the Central Excise Act, 1944, which allows the tribunal to refuse to admit an appeal if the duty amount or penalty involved does not exceed a certain limit. The court noted that the tribunal dismissed the appeal without considering that it had already been admitted after compliance with part payment of duty. This raised a substantial question of law regarding the tribunal's discretion in such matters.

2. The court further examined the statutory provision of section 35B, which outlines the scope of appeals to the Appellate Tribunal. The court emphasized that the tribunal's discretion to refuse admission of an appeal based on monetary limits should be exercised judiciously and not capriciously. The court found that once an appeal is admitted and kept pending, dismissing it on technical grounds without adjudicating on merits serves no purpose. The court concluded that the tribunal's refusal to decide the appeal on merits was erroneous and set aside the orders dismissing the appeal based on monetary limits.

3. In the final judgment, the High Court set aside the tribunal's orders and directed the appeal to be restored for adjudication on merits without considering the amount involved. The court emphasized that the tribunal should not dismiss appeals on technical grounds after they have been admitted and kept pending. The court highlighted the importance of judiciously exercising discretion in such matters and ensuring that litigants are not deprived of a fair hearing based on technicalities.

This detailed analysis of the judgment showcases the court's interpretation of the law, the tribunal's discretion, and the importance of fair adjudication in legal proceedings.