2018 (10) TMI 1278 - HC - Central Excise

Rectification of Mistake - ex-parte order - appellant contend that they were not intimated about the date of hearing, i.e. 20.01.2016, as they have not served with any notice - Held that - It is seen that the Tribunal does not assign a specific date on the date of hearing when the case is adjourned and the adjourned date is intimated by an adjournment notice and this procedure was adopted in the assessee s own case and the case stood adjourned to 16.9.2015, and the assessee received the adjournment notice dated 15.7.2015. The Revenue has not pointed out that the adjournment notice, fixing the date of hearing as 20.01.2016, was sent to the assessee. The non-appearance of the assessee before the Tribunal on 20.01.2016 is not attributable to the assessee, as they did not have due communication of the date of hearing - This is a sufficient ground to recall and set aside the order dated 20.01.2016, so that the appeal can be heard by the Tribunal and decided on merits and in accordance with law. The appeal stands restored to the file of the Tribunal to be heard and decided on merits, giving liberty to the assessee and the Revenue to canvass all points.

Summary

Issues:
Challenging order passed by CESTAT in Final Order dated 20.01.2016 and order dated 11.08.2016 in the application for rectification.

Analysis:
The appeals were filed by both the assessee and the Revenue challenging the CESTAT's order. The substantive appeal, C.M.A.No.2107 of 2016, contested the final order passed by the CESTAT on 20.01.2016. The Tribunal held that calling for payment of interest would not serve any useful purpose of law as there was no prejudice caused to the Revenue. The Tribunal accepted the Departmental representative's stand that the CENVAT Credit was unutilized and finally merged due to amalgamation with another company, and the final goods were exempted from a certain period. The Tribunal observed that the unutilized credit was reversed without prejudicing the Revenue.

The assessee, upon discovering the ex-parte order, filed an application for rectification, stating they were not informed about the hearing date and that the reversal of the CENVAT Credit was done under protest. The Tribunal rejected the rectification application, deeming it impermissible as a Review Application. The order dated 11.08.2016 was challenged in C.M.A.No.2027 of 2017. The Revenue appealed against the cancellation of the levy of interest in the order dated 20.01.2016 in C.M.A.No.1779 of 2016.

The Tribunal failed to notify the assessee or their representative about the hearing date, leading to the passing of the final order on 20.01.2016 without their presence. The Court found that the non-appearance of the assessee was not their fault, as they did not receive communication regarding the hearing date. Consequently, the Court decided to recall and set aside the order dated 20.01.2016 and the order dated 11.08.2016, allowing the appeal to be heard and decided on merits by the Tribunal. The Civil Miscellaneous Appeals were allowed, and the Substantial Questions of Law were left open for consideration, with the appeal restored to the Tribunal for a fair hearing.