2019 (12) TMI 531 - HC - Customs

Maintainability of appeal - appeal was dismissed for want of prosecution - only grievance in the present appeal is that CESTAT could not have dismissed the appeals for want of prosecution, contrary to the decision of the Hon'ble Supreme Court in the case of Balaji Steel Re-rolling Mills v. Commissioner of Central Excise Customs 2014 (11) TMI 531 - SUPREME COURT . HELD THAT - The learned Tribunal has erred, with great respect, in unnecessarily finding ways to distinguish the ratio and applicability of the said judgment of the Hon'ble Supreme Court in the case of Balaji Steel Re-rolling Mills, which was binding on all the lower Courts and the Tribunals without exception and, therefore, the learned Tribunal was bound to decide the appeals on merits. Being the final fact finding body, a duty is cast on the learned Tribunal to decide the appeals on merits. Tribunals are not Constitutional Courts. At the same time, if repeated adjournments were sought, the learned Tribunal could impose some costs on the appellant, but the appeals could not have been dismissed for want of prosecution or without deciding the merits of the case even though ex-parte, if it becomes necessary. Appeal allowed - appeals restored.

Issues:
1. Dismissal of appeals for want of prosecution by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai.
2. Interpretation of the powers of the Tribunal to dismiss appeals for default or want of prosecution.
3. Application of the principles laid down by the Hon'ble Supreme Court in the case of Balaji Steel Re-rolling Mills.
4. Justifiability of dismissing appeals for non-appearance despite multiple adjournments.
5. Authority of the Tribunal to impose costs on appellants seeking repeated adjournments.

Issue 1: Dismissal of appeals for want of prosecution by CESTAT:
The appellants contested the dismissal of their appeals by CESTAT for want of prosecution, citing the decision of the Hon'ble Supreme Court in Balaji Steel Re-rolling Mills. The Supreme Court had emphasized that the Tribunal must decide on the appeal's merits and cannot dismiss it for default of appearance. The High Court concurred, setting aside the orders of both the High Court and the Tribunal, directing the Tribunal to decide the appeal on merits and allowing the appeal with costs against the Respondent.

Issue 2: Interpretation of Tribunal's powers to dismiss appeals:
The Tribunal initially dismissed the appeals for want of prosecution, alleging abuse of the legal process by the appellants. However, the High Court clarified that the Tribunal's duty is to dispose of appeals on their merits, as per the statutory provisions, and not to dismiss them for non-appearance. The Tribunal's authority to dismiss appeals for default was questioned, emphasizing the need for a decision on the merits rather than mere dismissal due to non-appearance.

Issue 3: Application of Balaji Steel Re-rolling Mills principles:
The Tribunal distinguished the Balaji Steel Re-rolling Mills case, asserting that multiple adjournments were granted and directions were given to the appellants to prepare for the appeals. However, the High Court disagreed, holding that the Tribunal erred in not following the Supreme Court's ruling, which mandates deciding appeals on their merits. The Tribunal was reminded of its responsibility to consider and dispose of appeals on their substantive grounds rather than dismissing them for procedural reasons.

Issue 4: Justifiability of dismissing appeals for non-appearance:
The Tribunal's decision to dismiss the appeals despite adjournments and directions to the appellants was deemed unwarranted. The High Court emphasized that the Tribunal's role is to ensure a fair hearing and decision on the merits, even if costs are imposed for repeated adjournments. Dismissing appeals for non-appearance without deciding on the substantive issues was considered a departure from the legal mandate set by the Supreme Court.

Issue 5: Authority to impose costs on appellants seeking adjournments:
While acknowledging the Tribunal's discretion to impose costs on appellants seeking repeated adjournments, the High Court clarified that such costs should not lead to the dismissal of appeals without a substantive decision. The Tribunal was directed to restore the appeals, decide on the merits after hearing both parties, and impose costs on the appellants for each restored appeal, emphasizing the need for a fair and thorough adjudication process.

← Previous Next →