'CESTAT' IS HAVING NO POWER TO TRANSFER APPEAL TO ANOTHER AUTHORITY

[Mr. M. GOVINDARAJAN]

Section 129 A of Customs Act, 1962 deals with the appeals to be filed before CESTAT. The said section provides that any person aggrieved by any of the following orders may appeal to the Appellate Tribunal against such order -

(a) a decision or order passed by the Commissioner of Customs as an adjudicating authority;

(b) an order passed by the Commissioner (Appeals) under section 128A;

(c) an order passed by the Board or the Appellate Commissioner of Customs under Section 128, as it stood immediately before the appointed day;

(d) an order passed by the Board or the Commissioner of Customs, either before or after the appointed day, under section 130, as it stood immediately before that day.

Section 129B of the Act provides that the Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or annulling the decision or order appealed against or may refer the case back to the authority which passed such decision or order with such directions as the Appellate Tribunal may think fit, for a fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary.

The issue to be discussed in this article is whether the Tribunal is having power to transfer the appeal, filed before it for which it is not having jurisdiction to entertain, to another authority with reference to decided case laws.

In ‘Commissioner of Central Excise & Customs, Surat – I V. Intiyaz Traders’ – 2011 (3) TMI 743 - GUJARAT HIGH COURT it was held that an order of Commissioner (Appeals) which relates to rebate of excise duty on goods would not be maintainable before the Tribunal.   Even the respondent has not questioned the Tribunal’s finding that the appeal was not maintainable before the Tribunal the Tribunal is not having power to proceed with such appeal. A question arised when the appeal was not maintainable, could the Tribunal have provided for its transfer before the competent forum. In ‘O.P. Gulati V. Collector of Customs’ – 1992 (10) TMI 204 - CEGAT, NEW DELHI the Tribunal relied on the judgment of Madras High Court held that when an appeal is found not maintainable with the Tribunal, proper course would be to return the papers and not to direct its transfer.

In ‘Vikas Utilities V. Commissioner of Customs, New Delhi’ – 2013 (12) TMI 820 - CESTAT NEW DELHI the appeal against assessment order by the Assistant Commissioner (Customs), ICD, Thugladabad dispatched to Commissioner (Appeals), New Delhi under a postal cover, was sent to Commissioner (Appeals), Mumbai. The appeal was received within time. The Commissioner (Appeals), Mumbai instead of returning the appeal papers to the appellant ought to have transferred to the Commissioner (Appeals), New Delhi for disposal of the same. The appeal having been filed in time, though before wrong office inadvertently, the appeal should not have been dismissed on limitation.   The High Court remanded the matter to Commissioner (Appeals), New Delhi to decide on merits.

In ‘Commissioner of Customs (Preventive) V. Palvi Power Tech Sales Private Limited’ – 2013 (7) TMI 277 - GUJARAT HIGH COURT the appeal filed before the Tribunal by the respondent, since involved the question of duty drawback, the Tribunal was of the opinion that such appeal was not maintainable under Section 129A(1) of the Customs Act. The Tribunal thereupon transferred the appeal along with stay petition to the Joint Secretary, Government of India, for further action.   The Department challenged this order before the High Court.

The Department submitted the following before the High Court-

• The appeal before the Tribunal filed by the respondent was not maintainable;
• Any such proceeding, which was not competent before the Tribunal, the Tribunal had no powers to order its transfer before some other authority;

The Department relied on the judgment of High Court, Madras, in ‘India Pistons Limited V. Assistant Collector of Central Excise, Madras and others’ – 1986 (9) TMI 85 - HIGH COURT OF JUDICATURE AT MADRAS in which it was held that when the appeal was not maintainable by the Tribunal, the same could not have been transferred in terms of the provisions contained in Central Excise Act.

The respondent contended that the Tribunal has not decided the appeal on merits. Only direction is to transfer the proceedings before the revisional authority. Such powers are vested in the Tribunal by virtue of Rule 40 of the Customs, Excise & Service Tax Appellate Tribunal (Procedures) Rules, 1982.

The High Court analyzed the provisions of Section 129A and 129B of Customs Act. It held that the powers of the Appellate Tribunal in an appeal before itself are quite wide. In addition to confirming, modifying or annulling the decision under appeal, the Tribunal may even remand the proceedings before the lower authority for fresh adjudication with or without liberty to taking additional evidence which is maintainable. No such powers for obvious reasons can be exercised by the Tribunal in proceeding which is not competent before the tribunal. When in terms of clause (C) to proviso to Section 129A (1) [which provides that no appeal shall lie to the Tribunal against the order of Commissioner (Appeals) if such orders relates to payment of drawback as provided in Chapter X and rules made there under] the Tribunal had no jurisdiction to entertain the appeal of the respondent, the Tribunal could not have exercised any of the powers specified in Section 129B (1). The only option before the Tribunal was to reject such an appeal being not maintainable or return the papers back to the appellant for presentation before the appropriate forum.

The High Court also analyzed the provisions of Rule 41 of Customs, Central Excise & Service Tax Appellate Tribunal (Procedure) Rules, 1982.   Rule 41 provides that the Tribunal may make such orders or give such directions as may be necessary or expedient to give effect or in relation to the orders or to prevent abuse of its process or to secure the end of justice. The High Court held that Rule 41 gives the Tribunal powers to make orders or to issue directions as may be found necessary or expedient in order to give effect to or in relation to its order or to prevent abuse of the process, or to secure the ends of justice.   Such powers, however, which are ancillary in nature, must be seen in light of the Tribunal’s power under Section 129B of the Act.   Such powers when found necessary to be exercised, would be available only in the proceeding which are competent before the tribunal. No powers under Rule 41 would be exercised by the Tribunal in the proceedings which are not maintainable. In an appeal which the Tribunal had no jurisdiction to entertain, no orders could be passed relying on Rule 41. The High Court further observed that merely because there is practice before the Tribunal to transfer such proceedings when found not maintainable, would not permit the High Court to take a different view.   Such convention unless backed up statutory provisions and powers available with the Tribunal cannot be saved only on the ground that the same has lasted sufficiently long.