2019 (6) TMI 627 - HC - Central Excise

Principles of natural justice - Whether in the facts and circumstances of the case, the Tribunal was justified in not giving any finding on the submission of the Appellants that the Order in Original dated 15th February, 2008 was passed ex-parte without considering the request made by the Appellants by letter dated 5th February, 2008 to await the outcome of Writ Petition No. 974 of 2008? HELD THAT - If the Appellants were so concerned about the fact that the cross examination was necessary, in the facts of the present case, they ought to have moved the Court and sought urgent interim relief, from the Court before the hearing and disposal of the notice of the Commissioner of Central Excise. The Appellants seek adjournment on the ground that a writ is pending, clearly show that the Appellants seeks to delay the proceeding by not cooperating with the adjudication proceeding. This is apparent from the history of the present proceedings, particularly the earlier exparte order passed on account of non cooperation of the Appellants in disposal of the show cause notice by the Commissioner. This lead to the order of the Tribunal dated 24th September, 2007 setting aside the order dated 11th April, 2007 and restoring the notices to the Commissioner for fresh adjudication. We would have expected the parties to have cooperated with the adjudicating proceeding. It must be borne in mind that the principles of natural justice, is not a one way street. It does not require the authority to keep adjourning the hearing till such time as the party condescends to attend the hearing and make submission. So far as the submission that no reasons were indicated in the Commissioner's order dated 18th December, 2007 rejecting the cross examination, cannot be accepted. This for the reason that the application which was made on 10th December, 2007 seeking cross examination gave no reasons as to why the cross examination of the investigating offices, audit officers and jurisdictional range officers are necessary for appropriate disposal of the notices, bearing in mind that they are not the witnesses upon which the show cause notices were issued/relied. In any case, the orders of the Commissioner dated 15th February, 2008 and 19th February, 2008 record reasons for non giving of cross examination. The impugned order of the Tribunal finds that the the documents relied upon by the revenue were given to the Appellants along with show cause notices and there was no evidence produced to show that evidence other then that relied upon in the show cause notices were being relied by the revenue. Besides, witnesses whose cross examination were sought were not the witnesses in support of the show cause notices. Thus, the view taken by the Tribunal in dismissing the Appellants' Appeal in the present facts, cannot be said to be perverse in any manner. Appeal dismissed.

Summary

Issues:
Challenging order under Central Excise Act, 1944 for violation of natural justice principles.

Analysis:
The judgment involves four Appeals challenging an order by the Customs Excise and Service Tax Appellate Tribunal under the Central Excise Act, 1944. The Appeals questioned the Tribunal's failure to address the Appellants' submission regarding an ex-parte order and the request to await the outcome of a Writ Petition. The Appeals originated from show cause notices issued to the Appellants for Central Excise Duties and penalties for contravention. The Settlement Commission rejected the Appellants' applications due to lack of full disclosure, leading to the revival of proceedings before the adjudicating authority. Despite repeated requests to file replies and attend hearings, the Appellants did not cooperate, resulting in an order confirming demands and penalties. The Tribunal, in a previous order, set aside the Commissioner's order, directing a deposit and reply filing. In the subsequent remand proceeding, the Appellants sought cross-examination and data copies, which were denied by the Commissioner.

The Appellants challenged the Tribunal's order, arguing that the Tribunal failed to provide reasons for refusal of adjournment and cross-examination denial. They contended that the impugned order violated natural justice principles and should be set aside for fresh consideration. The Court noted the Appellants' history of non-cooperation in earlier proceedings and their attempts to delay adjudication. It emphasized the mutual obligation of parties to cooperate in adjudication and rejected the Appellants' request for adjournment based on pending writ petitions. The Court also found that the Commissioner's orders had reasons for denying cross-examination and returning data on floppies, which were not specifically challenged before the Tribunal.

Ultimately, the Court upheld the Tribunal's order, stating that no substantial question of law arose from the proposed issues. The Court dismissed all four Appeals, affirming the Tribunal's decision. The judgment highlights the importance of cooperation in adjudication proceedings and the need for parties to adhere to principles of natural justice for a fair and efficient resolution of disputes under the Central Excise Act, 1944.