2006 (2) TMI 170 - SC - Central Excise

Reclassification of goods - Previously consent order passed - respondent thereafter filed a review application seeking deletion of the expression from the consent order regarding condition that the respondent shall not raise any plea of limitation before the adjudicating authority - High Court held that power under the statute could not be taken away either collaterally or incidentally and, therefore, the respondent could not be debarred from taking the plea of limitation - Held that - Counsel appearing for the revenue fairly concedes in principle that the power/right conferred under the statute could not be given up on the basis of a concession made by any party to the lis - No merit in appeal - Decided against Revenue.

Summary

Issues:
1. Compliance with consent order regarding reclassification of goods.
2. Deletion of condition in consent order regarding plea of limitation.
3. Power under the statute not to be taken away by concession made by a party.

Comprehensive Analysis:

1. The case involved a writ petition filed in the High Court regarding the classification of goods. A consent order was passed in 1992, specifying that there should be no dispute about the classification of goods until a certain date. The Central Excise authorities were to finalize the amended classification list after giving the petitioner an opportunity for a hearing. The petitioner was not to raise any plea of limitation for a certain period, and any revision in classification would not affect the right of appeal. The petitioner was allowed to clear goods on bond until a specified date.

2. Subsequently, the Union of India issued a show cause notice reclassifying the goods without giving the respondent an opportunity to be heard. The respondent sought the deletion of a condition from the consent order that prevented them from raising a plea of limitation. The matter was referred to a third Judge due to a difference of opinion among the Judges of the High Court. The Chief Justice agreed that the respondent could not be debarred from raising the plea of limitation.

3. The appeal was filed against the order allowing the respondent to raise the plea of limitation. During the hearing, the revenue's counsel acknowledged that the power conferred by statute could not be waived based on a concession by any party. The Supreme Court upheld the order, stating that the power under the statute could not be relinquished by a concession made in a legal proceeding. Consequently, the appeal was dismissed, with each party bearing its own costs.