2008 (2) TMI 430 - HC - Central Excise

Whether the appeal filed by the Department can be dismissed by the Tribunal without going into the merits of the case? Whether the Commissioner can review its earlier decision accepting the order-in-appeal for not filing appeal before learned CESTAT in terms of section 35B (2) of the Central Excise Act, 1944? Held that - Once the Jurisdictional Commissioner of Central Excise has accepted the order in appeal and decided not to file an appeal against the same, subsequently he cannot review its order by changing his mind without giving any valid reasons. In the present case, the appellant has not placed on record any reason for which the Jurisdictional Commissioner wants to review its order and wants to file appeal. Merely because after the expiry of the period of limitation he has changed his mind, itself is no ground to condone the delay in filing the appeal. Such ground, in our opinion, is not sufficient for condoning the delay. Thus, in these facts and circumstances, we are of the opinion that in the present case no substantial question of law is arising from the order of the CESTAT. Appeal dismissed.

Summary

Issues:
1. Appeal dismissal without considering merits
2. Commissioner's power to review earlier decision
3. Condonation of delay in filing appeal

Analysis:

Issue 1: Appeal dismissal without considering merits
The appeal filed by the revenue under Section 35G of the Central Excise Act challenged an order confirming a demand, penalty, and interest against the assessee. The Commissioner (Appeals) allowed the appeal, holding the demand not sustainable and penalty not imposable based on the Apex Steels case law. The Jurisdictional Commissioner initially accepted this decision but later decided to file an appeal after a delay. The CESTAT dismissed the revenue's application for condonation of delay, citing the Commissioner's acceptance as making him functus officio, unable to file an appeal. The revenue challenged this order, arguing the Commissioner's power to review decisions under Section 35B(2).

Issue 2: Commissioner's power to review earlier decision
The Jurisdictional Commissioner's role under Section 35B(2) involves deciding to file or not file an appeal against an order. Once the Commissioner accepts an order-in-appeal, he cannot review the decision without valid reasons. The acceptance is not a mere formality, and changing the decision after the limitation period is not sufficient grounds for condoning delay. In this case, no valid reasons were provided for the review, leading the court to uphold the CESTAT's decision to dismiss the appeal.

Issue 3: Condonation of delay in filing appeal
The Jurisdictional Commissioner's authority to decide on filing appeals is a crucial administrative function requiring a conscious decision based on case facts. The court found that the Commissioner lacked the power to review the decision after acceptance, especially without valid reasons. The absence of substantial legal questions arising from the CESTAT's order led to the dismissal of the appeal by the High Court.

In conclusion, the High Court upheld the CESTAT's decision to dismiss the appeal, emphasizing the limitations on the Commissioner's power to review decisions and the importance of valid reasons for condoning delays in filing appeals.