1992 (3) TMI 203 - AT - Central Excise

Issues Involved:
1. Whether the Collector of Central Excise can permit an advocate to represent the Department in adjudication proceedings under Section 11A of the Central Excises Act.
2. Applicability and scope of Section 35Q of the Central Excises Act regarding representation by an advocate.
3. Whether principles of natural justice require or prohibit the Department's representation through an advocate in adjudication proceedings.
4. The dual role of the Collector as both adjudicator and prosecutor.
5. The legal standing of interlocutory communications in the context of appeals.

Issue-wise Detailed Analysis:

1. Representation by an Advocate in Adjudication Proceedings:
The main question was whether the Collector, having issued the show cause notice under Section 11A, invoking the extended period, can permit an advocate to represent the Department in the adjudication proceedings. The appellants argued that there is no 'lis' between the Department and the assessee in adjudication proceedings, unlike in appellate proceedings where representation from both sides is required. They contended that Section 35Q, which allows for representation through authorized representatives, does not apply to the Department in adjudication proceedings as the Department is neither 'entitled to' nor 'required to' appear before a Central Excise Officer.

2. Applicability and Scope of Section 35Q:
The appellants argued that Section 35Q, which appears in the chapter relating to appeals, should only apply to appellate proceedings and not to original adjudication proceedings. They contended that the Department does not have the right to be represented by an advocate in adjudication proceedings since the Collector himself represents the Department's interests. The respondent countered that Section 35Q is a general provision applicable to any proceedings before a Central Excise Officer or the Appellate Tribunal, and it does not specifically restrict representation to appellate proceedings.

3. Principles of Natural Justice:
The appellants argued that natural justice does not necessitate the Department being represented through an advocate in adjudication proceedings because the Collector, as the adjudicating authority, is expected to protect the Department's interests. They relied on case law to argue that when the law does not provide for rules of natural justice, they cannot be inducted into the proceedings. The respondent countered that the principles of natural justice require a fair hearing for both sides, and the Department should be allowed to present its case through an advocate if necessary.

4. Dual Role of the Collector:
The appellants contended that the Collector acts as both prosecutor and adjudicator in adjudication proceedings, and therefore, there is no need for the Department to have separate representation. The respondent argued that the Collector, while issuing the show cause notice, acts on a prima facie basis, but during adjudication, he must consider the evidence and arguments from both sides impartially. The Tribunal held that the Collector, as an adjudicating authority, must act in an unbiased manner and may require the Department's representation to ensure fairness and avoid allegations of bias.

5. Legal Standing of Interlocutory Communications:
The respondent raised a preliminary objection, arguing that the appeal was against an interlocutory communication and not a final order. The Tribunal acknowledged that interlocutory communications should not generally be subject to appeal but noted that the appellants felt prejudiced by the Collector's decision to allow an advocate to represent the Department. The Tribunal held that the communication from the Collector constituted a decision made in his capacity as an adjudicating authority, and therefore, it was appealable under Section 35B of the Central Excises Act.

Conclusion:
The Tribunal dismissed the appeal, holding that the Collector, as an adjudicating authority, has the discretion to allow the Department to be represented by an advocate in adjudication proceedings. The Tribunal found that Section 35Q is applicable to any proceedings before a Central Excise Officer and not limited to appellate proceedings. The principles of natural justice require a fair hearing for both sides, and the Department's representation through an advocate can be permitted if it is not specifically prohibited by law. The Tribunal also rejected the argument that the Collector acts as both prosecutor and adjudicator, emphasizing the need for impartiality and fairness in adjudication proceedings.

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