2019 (3) TMI 356 - HC - Customs

Principles of natural justice - non-consideration of arguments by the CESTAT - Held that - There is no merits in the appellant s grievance; the order-in-original - the common one against several assessees, was appealed through separate proceedings. The CESTAT noticed the arguments addressed in each of those appeals, however, it summarily disposed of all the appeals in merely two paragraphs, on an assumption of culpability and consequential reliability of the assessees. The matter is remitted for fresh hearing and consideration by the CESTAT which shall address the arguments of all the appellants on their merits and pass a speaking and reasoned order dealing with all contentions - appeal allowed by way of remand.

Summary

Issues:
Appeals against common Order-in-Original under Section 130 of the Customs Act, 1962 dismissed by CESTAT without considering merits, leading to substantial penalties imposed by the Commissioner.

Analysis:

1. Dismissal of Appeals by CESTAT:
The appeals were filed against a common Order-in-Original under Section 130 of the Customs Act, 1962. The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) dismissed all the appeals without considering the merits of the arguments presented by the appellants. The appellants contended that the appeals were filed as First Appeals directed against the Commissioner's order imposing significant liabilities in the form of substantial penalties. The CESTAT, however, summarily disposed of the appeals without adequately addressing the arguments put forth by the appellants.

2. Lack of Reasoning in CESTAT's Order:
The High Court observed that while the CESTAT did take note of the arguments presented in each appeal, it failed to provide a reasoned order explaining the basis for dismissing the appeals. The Court emphasized that in an appeal, the aggrieved party has the right to present their case on facts and law. Despite being presented with arguments on merits, the CESTAT's order lacked reasoning regarding the conclusions reached and the rationale behind dismissing the appeals. Consequently, the High Court set aside the impugned orders and remitted the matter for fresh hearing and consideration by the CESTAT.

3. Directions for Fresh Hearing:
In light of the deficiencies in the CESTAT's handling of the appeals, the High Court directed that the matter be reconsidered by the CESTAT. The CESTAT was instructed to address the arguments of all the appellants on their merits and issue a speaking and reasoned order that comprehensively deals with all contentions raised. The High Court partially allowed the appeals and directed the parties to appear before the CESTAT on a specified date for further proceedings.

4. Compliance and Transmission of Order:
The High Court directed the Registry to transmit a copy of the order directly to the CESTAT for compliance and to notify the concerned parties accordingly. This step was taken to ensure that the CESTAT conducts a fresh hearing in accordance with the High Court's directions and provides a reasoned decision addressing all relevant arguments presented by the appellants.

In conclusion, the High Court's judgment highlighted the importance of due consideration of arguments on merits in appeals and emphasized the need for reasoned orders by appellate authorities to ensure a fair and just adjudication process.