2003 (10) TMI 65 - SC - Central Excise

Validity of Show cause notice - Evasion of Duty - Supreme Court declined to interfere with the appeal where High Court held that The petitioner-company itself it is clear from the record objected to the levy and sought a decision on the preliminary question as to the validity of service of notice. This objection which was put forth in the form of a letter without any date was actually received by the third respondent on 13-9-1995 but on the very next day i.e. on 14-9-1995 the present writ petition was filed taking the plea that the Show Cause Notice was without jurisdiction. Having invited a decision on the aspect of the validity of service of notice it was not open to the petitioner to contend that the Show Cause Notice was without jurisdiction. The petitioner-company was fully aware of the contents of the Show Cause Notice and that is the reason why it went to the extent of citing the opinions of the former Chief Justice. Section 37C of the Central Excise Act only incorporates the well-known principle of natural justice that no body should be condemned unheard.

Summary

Issues:
Service of notice on the appellant-company, interference under Article 136 of the Constitution of India, validity of service of notice, jurisdiction of the Show Cause Notice, principles of natural justice.

Analysis:

1. Service of Notice on the Appellant-Company:
The Supreme Court, after considering the reasons recorded by the High Court in the impugned order regarding the service of notice on the appellant-company, found that there was no valid reason for interference under Article 136 of the Constitution of India. The High Court's observations highlighted that the appellant-company had objected to the levy and sought a decision on the preliminary question of the validity of the service of notice. Despite the objections raised by the appellant, the Court noted that the appellant was fully aware of the contents of the Show Cause Notice, as evidenced by citing the opinions of the former Chief Justice. The Court emphasized that the principles of natural justice, as enshrined in Section 37C of the Central Excise Act, dictate that no party should be condemned unheard.

2. Jurisdiction of the Show Cause Notice:
The Court dismissed the appeal, stating that it was not a fit case for interference. The High Court's findings indicated that the appellant had invited a decision on the validity of the service of notice, and therefore, it was not permissible for the appellant to later argue that the Show Cause Notice was without jurisdiction. The Court clarified that all other contentions could be raised by either party on merits before the appropriate authority, leaving the door open for further arguments on different aspects of the case.

In conclusion, the Supreme Court's judgment focused on the issues surrounding the service of notice on the appellant-company, the jurisdiction of the Show Cause Notice, and the application of principles of natural justice. The Court's decision to dismiss the appeal was based on the findings of the High Court and the established legal principles governing the matter. The judgment underscored the importance of procedural fairness and adherence to legal requirements in matters involving the imposition of duties or liabilities on parties.