2025 (2) TMI 27 - AT - Customs

Jurisdiction - exercise of proper discretion by Commissioner (Appeals) u/s 128A(3) of the Customs Act 1962 in remanding the case to the Adjudicating Authority for fresh adjudication - violation of principles of natural justice - HELD THAT - The impugned order has been passed in accordance with the provisions of Section 128A (3) of the Customs Act 1962 and no illegality or irregularity has been committed by the Commissioner (Appeals) in passing the impugned order as the Order-In-Original was passed by the Adjudicating Authority without following the principles of natural justice. The Commissioner (Appeals) was duty bound under Section 128A (3) of the Customs Act to refer the matter back to the Adjudicating Authority with direction for fresh adjudication. The learned Counsel for the appellant has vehemently argued that the Order-In-Original passed by the Adjudicating Authority in which reliance was placed on the Standing Order No. 6/2022 dated 04.07.2022 but such action was manifestly arbitrary illegal and baseless in as much as the Adjudicating Authority had ignored the fact that the standing order in para 4 had excluded certain category of Bills of Entry including Bills of Entry where the importer is invoking Section 149 or Section 154 of the Customs Act. In this context we are of the view that in this appeal the order dated 19.09.2023 is not under challenge. This appeal is directed against the order of Commissioner (Appeals) dated 16.07.2024 which seems to be proper and in accordance with law. Conclusion - The Commissioner (Appeals) has exercised his discretion in accordance with the relevant provisions of Customs Act and no interference is required in the impugned order. There is no merit in the Appeal and same is liable to be dismissed and impugned order is liable to be confirmed. Appeal dismissed.

Summary

ISSUES PRESENTED and CONSIDERED

The core legal questions considered by the Tribunal were:

• Whether the Commissioner (Appeals) exercised proper discretion under Section 128A(3) of the Customs Act, 1962, in remanding the case to the Adjudicating Authority for fresh adjudication.
• Whether the principles of natural justice were violated by the Adjudicating Authority in the initial proceedings.
• Whether the appellant's request for amendment of Bills of Entry under Sections 149 and 154 of the Customs Act, 1962, was improperly rejected.
• Whether the reliance on Standing Order No. 06/2022 by the Adjudicating Authority was arbitrary or incorrect.

ISSUE-WISE DETAILED ANALYSIS

Relevant legal framework and precedents:

The appeal revolved around the interpretation and application of Sections 128A, 149, and 154 of the Customs Act, 1962. Section 128A(3) provides the Commissioner (Appeals) with the authority to confirm, modify, or annul the decision or order appealed against or remand the matter back to the adjudicating authority in specific circumstances, such as violations of natural justice.

Precedents cited by the appellant included decisions from the Supreme Court and High Courts, which clarified the scope of Sections 149 and 154 as additional remedies for amending Bills of Entry.

Court's interpretation and reasoning:

The Tribunal upheld the Commissioner (Appeals)'s decision to remand the case, emphasizing that the initial order was passed without adhering to the principles of natural justice. The Tribunal noted that the Commissioner (Appeals) acted within the discretionary powers granted by Section 128A(3) to ensure a fair process.

Key evidence and findings:

The Tribunal found that the Adjudicating Authority failed to provide the appellant with an opportunity for a personal hearing or to raise queries before rejecting the amendment request. This omission constituted a breach of natural justice principles, as established in previous judgments.

Application of law to facts:

The Tribunal applied the principles of natural justice and the discretionary powers under Section 128A(3) to the facts, concluding that the Commissioner (Appeals) was correct in remanding the case for fresh adjudication. The Tribunal also considered the appellant's arguments regarding the applicability of Sections 149 and 154, finding that these sections offer additional remedies for amending Bills of Entry.

Treatment of competing arguments:

The appellant argued that the exemption from the Social Welfare Charge (SWS) was absolute and should have been granted despite the omission to claim it initially. The appellant also contended that the Standing Order No. 06/2022 was misapplied. The Tribunal acknowledged these arguments but focused on the procedural fairness issues, which justified the remand.

Conclusions:

The Tribunal concluded that the Commissioner (Appeals) acted appropriately in remanding the case, as the initial proceedings violated natural justice principles. The Tribunal dismissed the appeal, affirming the Commissioner (Appeals)'s decision.

SIGNIFICANT HOLDINGS

Preserve verbatim quotes of crucial legal reasoning:

The Tribunal noted: "It is settled position of law that before passing an adverse order, a reasonable opportunity of presenting one's case shall be provided."

Core principles established:

• The principles of natural justice must be adhered to in administrative proceedings affecting parties' rights.
• The Commissioner (Appeals) has the discretion under Section 128A(3) to remand cases for fresh adjudication when procedural fairness is compromised.
• Sections 149 and 154 provide additional remedies for amending Bills of Entry, which can be invoked under appropriate circumstances.

Final determinations on each issue:

• The Tribunal upheld the remand ordered by the Commissioner (Appeals) as a necessary step to rectify procedural deficiencies.
• The Tribunal confirmed that the appeal lacked merit, as the procedural violations justified the remand.
• The Tribunal dismissed the appeal, thereby affirming the Commissioner (Appeals)'s decision to remand the case for fresh adjudication.