1996 (8) TMI 286 - AT - Central Excise

Issues Involved:
1. Whether the Tribunal's rejection of the appeal based on the amended Section 35B(1) second proviso was correct.
2. Whether the amendment to Section 35B(1) second proviso, which increased the limit from Rs. 10,000 to Rs. 50,000, has retrospective effect.
3. Whether the appellant had a vested substantive right of appeal under the old provision.

Detailed Analysis:

1. Tribunal's Rejection of the Appeal:
The Tribunal initially rejected the appellant's appeal because the amount involved was Rs. 24,073.75, which was below the amended limit of Rs. 50,000 as per the second proviso to Section 35B(1) of the Central Excises & Salt Act, 1944. The Tribunal stated: "On going through the records, we find the amount of duty involved in the appeal is only Rs. 24,073.75. Therefore, the appeal is not admitted in terms of Second proviso to Section 35B (1) of the Central Excises & Salt Act, 1944."

2. Retrospective Effect of the Amendment:
The learned Counsel for the appellant argued that the Tribunal erred in applying the amended provision retrospectively. The Counsel contended that when the appeal was filed on 30-11-1991, the limit was Rs. 10,000, and the appellant had a statutory vested right to have the appeal heard on merits. The subsequent amendment increasing the limit to Rs. 50,000, which came into force on 13-5-1993, should not affect the appellant's vested right. The Counsel cited the Supreme Court's decision in Garikapati Veeraya v. N. Subbiah Choudhry, emphasizing that "the right of appeal is not a mere matter of procedure but a substantive right."

3. Vested Substantive Right of Appeal:
The Vice President agreed with the appellant's Counsel, stating that the right of appeal is a substantive right and the law as it stood at the time of filing the appeal should govern the case. The Vice President held that the Tribunal's order rejecting the appeal based on the amended limit was an "apparent error warranting rectification." He stated, "the later amendment to Section 35B(1) second proviso is not operative retrospectively as a procedural law." Consequently, the Vice President ordered the recall of the Tribunal's rejection and directed the appeal to be heard on merits.

Contra Opinion:
The Member (Technical) disagreed, asserting that the amendment was procedural and could be applied retrospectively. He argued that the right of appeal was not extinguished but only the limit for discretionary rejection was increased. He stated, "The discretion vested in the Tribunal in the matter of dismissal of the appeal cannot be taken to have whittled down the right to appeal and therefore has to be considered as procedural in nature."

Majority Decision:
The third Member, T.P. Nambiar, agreed with the Vice President, emphasizing that the appellant had a vested right under the old provision, and the amendment did not expressly or by necessary implication take away this right. He cited the Supreme Court's decision in Garikapati Veeraya, reiterating that "This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise."

Final Order:
In view of the majority decision, the Tribunal's order was recalled, and the registry was directed to list the appeal for disposal on merits in accordance with law and after due notice to the authorities concerned. The final order stated: "In view of the majority decision, the order of the Tribunal is recalled and the registry is directed to list the appeal for disposal on merits in accordance with law and after due notice to the authorities concerned."

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