2022 (7) TMI 140 - HC - Central Excise

Maintainability of application of substitution of legal heirs - HELD THAT - The prayer for substitution made by the revenue to substitute the legal heirs made by the revenue in GA/5/2022 to substitute the legal heirs of the deceased second respondent is not maintainable. The fact is clear that in the instant case the adjudication process was over and an order in original was passed by the Commissioner of Central Excise, CGST Central Excise, Howrah Commissionerate on 28th October, 2017. The assessee, namely, the company and the deceased second respondent filed an appeal before the Tribunal which was allowed by the impugned order. The revenue now seeks to challenge the order passed by the tribunal. Thus, the appeal being the continuation of the proceedings, the law as interpreted by the Hon ble Supreme Court in SHABINA ABRAHAM AND OTHERS VERSUS COLLECTOR OF CENTRAL EXCISE CUSTOMS 2015 (7) TMI 1036 - SUPREME COURT would squarely apply to the instant case on hand - the decision of the Hon ble Supreme Court in the case of Shabina Abraham squarely applies to the facts of this case as observed hereinbefore and the same is binding upon this Court. Application disposed off.

Issues:
1. Condonation of delay in preferring the appeal.
2. Condonation of delay in filing substitution application.
3. Substitution of legal heirs of deceased second respondent.
4. Interpretation of provisions under the Central Excise and Salt Act regarding proceedings against deceased persons.
5. Applicability of legal precedents in similar cases.
6. Liability of legal representatives in tax matters.

Analysis:

1. Condonation of Delay in Preferring the Appeal:
The Court condoned the delay in preferring the appeal after considering the reasons given in the application for condonation of delay under Section 5 of the Limitation Act, 1963. The delay was deemed to be condoned, and the appeal was allowed.

2. Condonation of Delay in Filing Substitution Application:
An application was filed by the revenue to condone a delay of 1013 days in filing a substitution application. The Court accepted the reasons provided in the affidavit, stating that the delay was not attributable to the department. The delay was condoned, and the application was allowed.

3. Substitution of Legal Heirs of Deceased Second Respondent:
The revenue filed an application to substitute the legal heirs of the deceased second respondent, who was a director of a company. The Court heard arguments from both sides, where the revenue sought to bring on record the legal heirs, while the respondent opposed the prayer for substitution. The Court referred to a Supreme Court decision and concluded that the prayer for substitution made by the revenue was not maintainable. Consequently, the second respondent was deleted from the array of parties, and the relief granted by the tribunal to the deceased person was affirmed.

4. Interpretation of Provisions under the Central Excise and Salt Act Regarding Proceedings Against Deceased Persons:
The Court extensively discussed the provisions of the Central Excise and Salt Act in light of a Supreme Court decision. It was noted that there is no separate machinery provided under the Act to proceed against a deceased person for tax assessment. The definition of "assessee" under the Act was compared to that under the Income Tax Act, highlighting that the person referred to must be a living person. The Court rejected arguments by the revenue that sought to apply principles differently for the Central Excise and Salt Act, emphasizing the need to interpret taxing statutes based on the language used.

5. Applicability of Legal Precedents in Similar Cases:
The Court referred to various legal precedents, including decisions of the Supreme Court and High Courts, to support its interpretation of the law regarding proceedings against deceased persons in tax matters. The judgments cited were analyzed to establish the correct application of the law in the present case.

6. Liability of Legal Representatives in Tax Matters:
Arguments were presented regarding the liability of legal representatives in tax matters, specifically in the context of the Central Excise and Salt Act. The Court relied on legal principles and precedents to determine the extent of liability of legal heirs or representatives in such cases, ultimately dismissing the application for substitution and affirming the relief granted to the deceased person by the tribunal.

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