2005 (12) TMI 103 - HC - Central Excise

Rectification of mistake - Limitation - S eeking quashing and setting aside of the order made by CESTAT in appeal as well as the orders of the Commissioner (Appeals) and the Adjudicating Authority - HELD THAT - In the present case, the Registry of the Tribunal has categorically averred that it had sought to effect the service in the manner laid down in Section 37C(1)(a) of the Act and the envelope had been returned unserved. Therefore, the Registered Post had not been acknowledged. Thereupon, it became necessary for the authority to effect service in the mode prescribed under Section 37C(1)(b) of the Act, and in the event of non-service by the said manner, by the mode prescribed under clause (c) of sub-section (1) of Section 37C of the Act. It is not even the case of respondent No. 2 that it had sought to effect service and had effected service in any of the modes prescribed under clauses (b) and (c) of sub Section (1) of Section 37C of the Act. Thus, the averment made on oath by the petitioner that a copy of the order was not served on the petitioner, remains unrebutted. The Technical Officer of CESTAT vide communication dated 23-8-2005 has returned the papers of ROM Application on the ground that the same was barred by limitation. There is another angle from which the matter can be approached. It is only the party to the appeal who finds that the order contains a mistake apparent from the record and is aggrieved by such mistake, would be in a position to move an application seeking rectification of the order. Therefore also, unless and until a party to the appeal is in a position to go through and study the order it would not be possible, nor can it be envisaged, that a party can claim to be aggrieved by the mistake apparent from the record. Hence, even on this count the period of limitation has to be read and understood so as to mean from the date of the receipt of the order. Therefore, the action of the Technical Officer to return the papers of ROM Application without even placing the same before the Bench concerned is not only bad in law, but is not supported by the provisions of the Act. Thus, the ROM Application moved by the petitioner not having been disposed of on merits after hearing the parties, it would be just and fair that the same is taken on record and disposed of after hearing the parties. The communication dated 23-8-2005 (Annexure J), addressed by the Technical Officer of CESTAT to the petitioner is hereby quashed and set aside. As the record reveals the appeal was fixed for hearing on 16-10-2003, the petitioner prayed for adjournment through its Advocate and thereafter did not take any steps to pursue the outcome of adjournment application, nor did the petitioner make any inquiry as to why no date of hearing was being fixed. This lapse of the petitioner continued up to 13-7-2005 i.e. nearly two years and in the circumstances, it would be just and fair if the petitioner is directed to pay costs of the petition to the respondents namely respondent no. 3. The costs so payable by the petitioner are quantified at a sum of Rs. 10,000/- (Rupees Ten Thousand Only). The petition is accordingly allowed. Rule is made absolute to the aforesaid extent.

Summary

Issues:
Challenge to action of Registry of CESTAT, denial of concessional rate of duty, failure of service of order by CESTAT, return of ROM Application, computation of limitation period for ROM Application.

Analysis:

1. The petition challenged the action of the Registry of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) for returning the papers of Rectification of Mistake (ROM) Application filed by the petitioner-company. The petitioner sought direction for CESTAT to hear and decide the ROM Application on merits. The controversy primarily revolved around the denial of concessional rate of duty to the petitioner-company by the authorities.

2. The petitioner had taken over a partnership firm manufacturing paper cups for ice-cream. The authorities issued a show cause notice proposing to deny the concessional rate of duty, leading to a demand being raised against the petitioner. The appeal filed by the petitioner before Commissioner (Appeals) was unsuccessful, prompting the petitioner to approach CESTAT through a Second Appeal.

3. The Second Appeal was decided ex-parte as the petitioner's advocate's application for adjournment was rejected. The petitioner claimed to be unaware of the order made by CESTAT dismissing the appeal partly. Subsequently, the petitioner faced challenges in obtaining a certified copy of the order for filing the ROM Application within the limitation period.

4. The Technical Officer of CESTAT returned the ROM Application citing it as time-barred due to being filed after the expiry of the limitation period. The petitioner contended that the limitation period should be computed from the date they obtained the order copy, not from the date of the original order.

5. The Court analyzed the provisions of Section 35C(2) of the Central Excise Act, emphasizing that the period of limitation for rectification should be computed from the date of receipt of the order, not from the date of the original order. The Court found the actions of the Technical Officer in returning the ROM Application without placing it before the Bench as unjust and not supported by the provisions of the Act.

6. The Court quashed the communication returning the ROM Application and directed the petitioner to present the application without waiting for a certified copy. The Registry of the Tribunal was instructed to circulate the application for hearing. The petitioner was directed to pay costs to the respondents due to the delay in pursuing the matter.

7. Ultimately, the petition was allowed, and the rule was made absolute, addressing the issues raised regarding the denial of concessional rate of duty, service of orders, and computation of the limitation period for the ROM Application.