1993 (12) TMI 152 - AT - Central Excise

Issues Involved:
1. Waiver of pre-deposit of duty and penalty.
2. Denial of principles of natural justice.
3. Ex parte order and opportunity for hearing.
4. Allegation regarding the bogus nature of Sruti Sales Corporation.
5. Financial hardship of the appellant.

Issue-wise Detailed Analysis:

1. Waiver of Pre-deposit of Duty and Penalty:
The appellant filed an application for waiver of pre-deposit of duty amounting to Rs. 3,17,782.58 and a penalty of Rs. 25,000/-. The appellant contended that the impugned order was passed ex parte and requested the matter be remanded for a fresh hearing. The appellant argued that due to the illness of the Chief Executive, they could not attend the hearing, and thus, the order passed was not sustainable. The Tribunal, considering the circumstances, decided to grant the waiver of pre-deposit and remanded the matter for reconsideration.

2. Denial of Principles of Natural Justice:
The appellant argued that the principles of natural justice were denied as the lower authority decided the matter ex parte without giving adequate opportunity for a hearing. The appellant had requested adjournments due to the Chief Executive's illness, which were granted initially but not subsequently. The Tribunal noted that there was a finding in the impugned order about the bogus nature of Sruti Sales Corporation, which was not mentioned in the show cause notice, thus denying the appellant a fair opportunity to contest this finding.

3. Ex Parte Order and Opportunity for Hearing:
The appellant contended that the ex parte order was unjust as they were unable to attend the hearing due to unavoidable circumstances. The Tribunal acknowledged that the appellant had arguable points and that the ex parte order was passed without adequate representation. Consequently, the Tribunal decided that in the interests of justice, the appellant should be given another opportunity to present their case.

4. Allegation Regarding the Bogus Nature of Sruti Sales Corporation:
The impugned order contained a finding that no firm named Sruti Sales Corporation existed, and the invoices raised were bogus. The appellant argued that this allegation was not mentioned in the show cause notice, and they were not given an opportunity to contest this finding. The Tribunal noted this procedural lapse and concluded that the appellant should be given a chance to address this issue during the remanded proceedings.

5. Financial Hardship of the Appellant:
The appellant submitted financial documents to demonstrate financial hardship. However, the Tribunal observed that the appellant had a substantial sales turnover and profits, indicating no significant financial hardship. Despite this, the Tribunal decided to grant the waiver of pre-deposit based on the procedural lapses and the need for a fair hearing.

Separate Judgments by Judges:

Member (Judicial):
The Member (Judicial) opined that the waiver of pre-deposit should be granted, and the matter should be remanded for a fresh hearing. The Member emphasized the denial of natural justice and the need for the appellant to be given another opportunity to present their case.

Member (Technical):
The Member (Technical) disagreed with granting the waiver of pre-deposit, arguing that the lower authority had provided adequate opportunities for a hearing, and the appellant failed to utilize them. The Member (Technical) held that there was no prima facie infirmity in the lower authority's order and that the principles of natural justice were not violated.

President's Decision:
The President, addressing the point of difference, sided with the Member (Judicial), emphasizing the denial of natural justice due to the non-supply of the investigation report and the procedural lapses. The President concluded that the matter should be remanded for a fresh hearing, thus resolving the point of difference in favor of the appellant.

Final Order:
In view of the majority decision, the impugned order was set aside, and the matter was remanded to the adjudicating authority for reconsideration in accordance with the law, with another opportunity for the appellant to be heard.

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