1998 (3) TMI 457 - AT - Central Excise

Summary

Issues: Violation of principles of natural justice in adjudication process, Relief sought under Section 35F of the Central Excise Act, 1944

In this case, the Appellate Tribunal CEGAT, New Delhi, dealt with an appeal against an order by the Collector of Central Excise confirming duty demand, interest payment under Section 11AB of the Central Excise Act, 1944, penalty imposition, and plant and machinery confiscation. The main allegations were clandestine removal of goods and undervaluation. The appellant contended a violation of natural justice principles and sought relief under Section 35F, claiming denial of opportunity to respond to the show cause notice adequately. The appellant detailed a timeline of events showing requests for document copies, inspection, and delays in providing necessary materials for response.

The appellant's counsel argued that the adjudicating authority's actions hindered the appellant's ability to respond effectively. The appellant requested copies of relied-upon documents, but faced delays and unavailability of essential materials. Despite efforts to obtain documents, the appellant faced challenges due to the voluminous nature of the evidence. The Commissioner proceeded with the order without addressing the appellant's requests adequately, leading to concerns over the fairness of the adjudication process.

The Commissioner mentioned that another concern involved in the matter had inspected and copied most documents, but the appellant disputed the relevance of those materials due to subsequent issues between the concerns. The appellant highlighted the extensive nature of the documents relied upon by the Department, indicating the need for a thorough review before formulating a response. The Tribunal acknowledged the appellant's need to examine all materials to prepare a comprehensive reply, noting a prima facie case of natural justice violation.

Considering the circumstances, the Tribunal found merit in the appellant's claim of natural justice violation and waived the pre-deposit requirement for the duty and penalty amounts. The Tribunal allowed the application, providing relief to the appellant based on the demonstrated procedural irregularities. The decision opened the possibility for an early appeal hearing at the respondent's discretion, emphasizing the importance of upholding principles of natural justice in adjudicatory processes.