2012 (4) TMI 162 - AT - Central Excise

Principle of natural justice - waiver of predeposit of duty and penalty of an equal amount under 173Q - applicant contented that the Commissioner (Appeals) directed to make predeposit at 5% of entire amount of duty confirmed and penalty imposed in this case without affording them any personal hearing - Held that - this Bench in the case of Packwell Plastic Pvt. Ltd. Vs. Commissioner of Central Excise - 2010 - TMI - 78564 - CESTAT KOLKATA held that impugned order was passed in violation of principles of natural justice and liable to be set aside - The matters are remanded to the Commissioner (Appeals) to decide afresh affording an opportunity of hearing to the appellants .

Summary

Issues:
- Application for waiver of predeposit of duty and penalty under Central Excise Rules, 1944.
- Violation of principles of natural justice in passing order for predeposit without personal hearing.
- Comparison with a similar case leading to remand for denovo consideration.
- Decision to set aside impugned orders and remand the matters for fresh consideration.

Analysis:
The judgment by the Appellate Tribunal CESTAT, Kolkata involved an application for waiver of predeposit of duty and penalty under the Central Excise Rules, 1944. The applicant sought relief from predeposit of a substantial amount, which was contested by the Department. The Tribunal, after hearing both sides, decided that the appeal could be disposed of without the requirement of predeposit, thereby taking up the appeal for further consideration.

A key issue raised was the alleged violation of principles of natural justice in the process. The applicants contended that they were directed to make a predeposit without being afforded a personal hearing, leading to their appeal being dismissed by the Commissioner (Appeals). Reference was made to a previous case where a similar situation was remanded for denovo consideration, highlighting the inconsistency in treatment.

Upon reviewing the submissions and case records, the Tribunal agreed with the applicant's consultant that the order for predeposit was indeed passed without providing a personal hearing, constituting a violation of natural justice. Citing precedents, the Tribunal found merit in the appellants' contention and set aside the impugned orders. Consequently, the matters were remanded to the Commissioner (Appeals) for fresh consideration after granting an opportunity for a hearing, emphasizing the importance of adhering to principles of natural justice in such proceedings.

In conclusion, the Tribunal remanded the instant case to the Commissioner (Appeals) for a fresh decision on the appeal and stay application. It was emphasized that the appellant should be granted an opportunity for a hearing, ensuring a fair and just process. The appeal was disposed of by way of remand, with the stay petition also being resolved accordingly.