2022 (9) TMI 432 - HC - Central Excise

Principles of natural justice - petitioner would argue mainly on the fact that the Appellate Order has been passed in a non-speaking fashion and without having considered the impact of Circular No.32/2004 dated 11.05.2004 - HELD THAT - In the present case, the impugned order is certainly cryptic. It does not discuss the legal issue raised by the petitioner with reference to documents on records, in as detailed a fashion as may have been appropriate. That apart, the petitioner is also factually correct in that, the case-law as well as Circular cited and relied upon have been omitted to be considered. The aforesaid finding is based upon appeal records that have been called for and verified. The threshold for interference would also depend on whether the order challenged is an original order of assessment passed by the Assessing Officer or one passed in Appeal and in the later circumstances, unless, the error pointed out is patent and goes to the root of the matter, the preferred course of action must continue with the appellate hierarchy itself - the threas-hold has not been achieved. No doubt, the Appellate Authority, being a quasi-judicial authority, has to pass a reasoned and speaking order, taking note of all arguments advanced, and materials submitted by the Assessee. The flaw in the present impugned order is that it is rather nonspeaking and omits to consider the circular and case law cited. However, this is not an error so grave so as to justify invoking the extraordinary jurisdiction of this Court. The petitioner herein has remitted 100% of the disputed tax and is clearly not pursuing Writ remedy merely as a ruse to avoid the question of pre-deposit - Petition dismissed.

Summary

Issues:
Challenge to order by Appellate Commissioner of GST and Central Excise regarding jurisdiction and non-speaking fashion of the order. Deviation from statutory appellate hierarchy. Invocation of extraordinary jurisdiction under Article 226. Consideration of parameters for exercising jurisdiction under Article 226. Lack of reasoning in impugned order. Maintainability of writ petition with alternate remedy available.

Analysis:

1. The petitioner challenged an order by the Appellate Commissioner of GST and Central Excise, raising concerns about the jurisdiction and the non-speaking nature of the order. The petitioner argued that the order did not consider important circulars and case law presented during the personal hearing.

2. The court noted the petitioner's deviation from the statutory appellate hierarchy and referenced a previous case where a similar challenge was rejected due to the availability of a statutory appeal. The petitioner defended its right to approach the High Court under Article 226 of the Constitution in justified cases.

3. The court discussed the parameters for considering the exercise of jurisdiction under Article 226, including unfairness, unreasonableness, perversity, lack of jurisdiction, and violation of natural justice. It acknowledged the cryptic nature of the impugned order and the omission of critical case law and circulars.

4. The respondent belatedly argued against the petitioner's stand in the counter, which the court found inappropriate. Citing a Supreme Court case, the court emphasized the importance of orders being fully supported by reasons provided within the order itself.

5. The court deliberated on the adequacy of reasoning in the impugned order, highlighting that orders should not improve over time like wine. It considered whether interference under Article 226 should be warranted solely based on deficiencies in the appellate order.

6. Ultimately, the court concluded that the impugned order's flaws, while significant, did not justify the extraordinary jurisdiction of the High Court. The petitioner was directed to pursue the statutory remedy of a second appeal before the CESTAT, relegating them to the appellate hierarchy.

7. The court dismissed the writ petition, emphasizing that the error should be egregious and serious to bypass the alternate remedy available. The petitioner's genuine pursuit of the matter, without using the writ remedy to avoid pre-deposit, was acknowledged.

8. The court maintained that the proper course of action for the petitioner was to continue with the second appeal before the CESTAT. An appeal against the impugned order was allowed within thirty days, without limitations on pre-deposit, subject to statutory compliances.

9. The judgment was ultimately dismissed with liberty and no costs imposed, closing the connected Miscellaneous Petition.