1996 (8) TMI 132 - HC - Central Excise

Summary

Issues Involved:
1. Validity of the show cause notice as a preliminary issue.
2. Non-supply of the report and figures of production.
3. Jurisdiction and limitation period for issuing the show cause notice.
4. Denial of adjournment and opportunity for personal hearing.

Detailed Analysis:

1. Validity of the Show Cause Notice as a Preliminary Issue:
The petitioners argued that the validity of the show cause notice was not decided as a preliminary issue, as directed by the court on 16-8-78. The court examined Annexure M and found that the respondent no. 1 was fully aware of the court's order and had discussed the validity of the show cause notice in detail on pages 19, 20, and 21 of the impugned order. The respondent no. 1 concluded that the show cause notice was not time-barred under Rule 10 read with Rule 173-J of the Central Excise Rules, 1944, as Rule 10 related to short levy and not non-levy due to clandestine removal of goods. The court found no infirmity in this conclusion and repelled the petitioners' first contention.

2. Non-supply of the Report and Figures of Production:
The petitioners contended that they were not supplied with the report and figures of production. The court referred to its order dated 16-8-78, which stated that the respondents would issue summons for the production of documents specified by the petitioners. The petitioners failed to establish that they made any such application for documents. The respondent no. 1 recorded that all relied-upon documents and the Deputy Chief Chemist's report were made available to the petitioners. Thus, the court repelled the second contention.

3. Jurisdiction and Limitation Period for Issuing the Show Cause Notice:
The petitioners argued that the show cause notice was issued beyond the stipulated six-month period, rendering it without jurisdiction. The court noted that the case fell within the purview of the proviso to Section 11A of the Act, which provides a five-year limitation for cases involving collusion, misrepresentation, suppression of facts, or contravention of the Act or Rules to evade duty. The court held that making incorrect entries or clearing goods without proper records amounted to suppression of facts, thus the five-year limitation applied. The court found no merit in this contention.

4. Denial of Adjournment and Opportunity for Personal Hearing:
The petitioners argued that they were denied a reasonable opportunity of being heard as their request for adjournment due to their counsel's unavailability was refused. The court acknowledged that while adjournments are generally granted for non-availability of counsel, it depends on the case's circumstances. The respondent no. 1 had provided multiple opportunities for personal hearing and written submissions from 1976 to 1982. The petitioners were informed on 18-8-82 that failure to appear on 8-9-82 would result in an ex parte decision. The court found that the principles of Audi Alteram Partem were observed, and the petitioners were afforded adequate opportunity. The court dismissed the petitioners' contention, emphasizing that natural justice does not always mandate personal hearings and that opportunity to present the case suffices.

Conclusion:
The court concluded that no case for interference was made out, and the writ petition was dismissed. The court upheld the respondent no. 1's decision, finding no procedural or substantive errors in the handling of the show cause notice, supply of documents, jurisdiction, limitation period, and opportunity for hearing.