DE NOVO ADJUDICATION

[Dr. Sanjiv Agarwal]

Many a times, appellate authorities remand the matter to adjudication authorities for de novo (fresh) adjudication with or without any directions.

De Novo Adjudication

The term ‘do novo’ has not been defined in any of the statutes. As per Black’s Law Dictionary, the term ‘de novo trial’ means as follows:-

“Generally, a new hearing or a hearing for the second time, contemplating an entire trial in same manner in which matter was originally heard and a review of previous hearing.

Trying matter a new as if the same had not been heard before and as if no decision had been previously rendered”.

Some of the illustrative grounds on which a matter may be remanded for de novo adjudication

may be as follows:-

(i) Non-speaking order

(ii) Non-acceptance of evidence

(iii) Non-consideration of the submissions

(iv) Non-application of mind by the adjudication authority

(v) Submission of additional evidences to higher appellate forum which were not considered by lower authorities

(vi) Non-furnishing of the relied upon document in the SCN

(vii) Denial of natural justice such as appropriate notice/reasonable opportunity/sufficient time not given to assessee

(viii) Non-consideration of evidence by the adjudicating authority

De novo adjudication is ordered with the objective of preventing miscarriage of justice, ensuring that people get fair and reasonable trials. When the matter is remanded back by the Tribunal to the lower authorities, the order of the Commissioner or any other adjudicating authority or Commissioner (Appeals) no longer sustains. The matter is required to be adjudicated afresh and both parties can make additional submissions. Moreover, even if the Court or Tribunal does not give any direction to the re-adjudicating authority regarding any aspect of the case, the re-adjudicating authority is still bound to go into each and every aspect before deciding upon the case.

In Microland Ltd. v. CC (Prev.), Mumbai 2014 (9) TMI 236 - CESTAT MUMBAI, the order was passed after 2 years of conclusion of personal hearing and written submission. As per C.B.E.C.

guidelines vide Circular No. 732/48/2003-CX dated 5-8-2003, the guideline to communicate decision within a reasonable time of 5 days or in a particular case, order should be issued within 15 days or at most one month from date of conclusion of personal hearing was not adhered. Further, there were certain issues, which had not been considered in the impugned order by the adjudicating authority. Therefore, it was held that it would be in the interest of natural justice to remand the matter back to the adjudicating authority for de novo adjudication.

In Simplex Engineering & Foundary Works P. Ltd. v. CCE, Raipur 2014 (8) TMI 433 - CESTAT NEW DELHI, it was held that second remand is not permissible when Revenue failed to enquire about particulars of transaction during de novo adjudication. Department was not conscious to enquire genuineness of the transaction nor questioned use of the goods in manufacture. There was dereliction of duty by Revenue under law, for which the assessee should not suffer for which appeal was allowed.

Discussions to this article

[Mahir S]

Sir,

In the decision of the Hon’ble Apex Court in the case of M/s. MIL India Ltd. Vs. Commissioner of Central Excise, Noida = 2007 (3) TMI 8 - SUPREME COURT OF INDIA at para 4 of the order, it has been observed by the Apex Court that the power of remand by Commissioner (Appeals) has been taken away by amending Section 35 (A) wef 11.05.2001 under the Finance Bill, 2001.

The Board has also referred to the decision of the Hon’ble Apex Court in the above case in its instructions dated 18.02.2010, issued from F. No. 275/34/2006-CX. 8A, stating that the Commissioner (Appeals) has no power to remand the case.