2023 (5) TMI 972 - AT - Central Excise

100% EOU - Clandestine Removal/suppression of production - non-speaking order - violation of principles of natural justice - HELD THAT - It appears that the entire order has been passed without considering any submissions made by the appellant, which runs into 83 pages. Though the statements of various persons have been relied upon by the Commissioner, specifically of Shri Kamlesh S. Patil, his cross-examination though asked for has not been allowed or rejected in the impugned order. The impugned order is totally a non-speaking order passed in violation of the principles of natural justice and cannot be sustained. Adjudicating authority is obligated under law to consider the submissions made in response to the show cause notice and any order passed without consideration of the submissions is in violation of the principles of natural justice and needs to be set aside. Matter is remanded back to the original authority for passing a speaking order taking into consideration the submissions made in reply to the show cause notice, including the request for cross-examination of Shri Kamlesh S. Patil - Appeal allowed by way of remand.

Issues:
1. Confirmation of demand under Sec. 11A(2) of Central Excise Act, 1944.
2. Imposition of interest under Sec. 11AB of Central Excise Act, 1944.
3. Imposition of penalty under sec. 11AC of Central Excise Act, 1944.
4. Imposition of penalty on DTA Unit and individuals under Rule 26 of Central Excise Rules, 2002.
5. Consideration of submissions made by the appellant in response to the show cause notice.

Confirmation of Demand:
The appeals were against an order confirming a demand of Rs. 1,29,16,409 under Sec. 11A(2) of the Central Excise Act, 1944. The order also appropriated the amount already paid against the confirmed demand. The tribunal found that the order was a non-speaking order passed without considering the submissions made by the appellant, which were extensive and ran into 83 pages. The tribunal held that the order was in violation of the principles of natural justice and set it aside. The matter was remanded back to the original authority for a speaking order, considering all submissions made, including the request for cross-examination of a key witness.

Imposition of Interest and Penalty:
The order also imposed interest at an appropriate rate on the confirmed demand under Sec. 11AB of the Central Excise Act, 1944. Additionally, penalties were imposed under sec. 11AC of the Act on the appellant and under Rule 26 of the Central Excise Rules, 2002 on the DTA Unit and individuals. The tribunal found that the penalties were imposed without proper consideration of the appellant's submissions and without allowing the requested cross-examination. The tribunal set aside the order and remanded the matter back to the original authority for a speaking order, taking into account all submissions, including the request for cross-examination.

Consideration of Submissions:
The appellant had made elaborate submissions in response to the show cause notice, running into 83 pages. However, the adjudicating authority passed the order without considering any of these submissions, which the tribunal deemed a violation of the principles of natural justice. The tribunal emphasized that the adjudicating authority is obligated to consider the submissions made in response to the show cause notice, and any order passed without such consideration cannot be sustained. Therefore, the matter was remanded back to the original authority for a speaking order, considering all submissions made by the appellant.

This detailed analysis covers the issues of confirmation of demand, imposition of interest and penalties, and the consideration of submissions, providing a comprehensive overview of the judgment delivered by the appellate tribunal.

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