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TMI Blog2010 (2) TMI 243X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner imposing interest and penalty against the firm M/s. LD Textile Industries Ltd. has also confirmed the imposition of penalty upon the three appellants. However, the penalty on the three appellants who are directors or managers of the firm M/s. L.D. Textile Industries Ltd., is modified from Rs.2 crores to Rs.20 lakhs, which is sought to be challenged in the present appeals mainly on the ground that the order passed by the Tribunal is not a speaking order and no reasons are recorded for modifying or reducing the penalty from Rs.2 crores to Rs.20 lakhs on the individual appellants. Learned counsel Mr. Oza submitted that it is a loss to the revenue and without any reason or without recording the reasons as to what has weighed with the Tribunal for such modification of the penalty qua the individuals who are the directors or managers of the firm the penalty has been reduced from Rs.2 cores to Rs.20 laths which is arbitrary and therefore it requires to be considered in light of the orders passed by the Hon'ble Apex Court as well as the High Court. 3. Learned counsel Mr. Oza for that purpose referred to the order passed by this court in Tax Appeal No. 140 of 2008 [ (234) E.L.T. 24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of the Hon'ble Apex Court in the case of Commissioner of Central Excise, Bangalore v. Srikumar Agencies, 2008 (232) E.L.T. 577 (S.C.) = 2009 (13) S.T.R. 3 (S.C.) He abs also referred to the judgment of the Bombay High Court in the case of Commissioner of Central Excise v. Seasons Polymers, reported in 2008 (229) E.L.T. 664 (Bom.) as well as in the case of Commissioner of Central Excise, Kolkata-II v. Shree Raghunath Industries, 2009 (240) E.L.T. 528 (Cal.). He has also referred to and relied upon the judgment of this court in the case of Steadfast Paper Mills v. Dr. Kohli, former Collector of Central Excise, Baroda and Ors., 1983 (12) E.L.T. 744 (Guj.). Learned counsel Mr. Oza has also referred to and relied upon the judgment of the Hon'blele Apex Court in the case of Coats Viyella India Ltd. v. Commissioner of Central Excise, reported in 2004 (173) E.L.T. 229 (S.C.).) and pointedly emphasised the observations in para 5 as under: - "The CEGAT, while dealing with the appeals of the revenue did not specifically refer to the conclusions of the first appellate authority and did not indicate any reason as to why it was of the view that the conclusions were not correct. Least that w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... easons has rendered the [ Court's judgment] not sustainable... 6. ... Even in respect of administrative orders, Lord Denning, MR. In Breen v. Amalgamated Engg. Union - (1971) 2 QB 175 observed (All ER p. 1154h) The giving of reasons is one of the fundamentals of good administration. In Alexander Machinery(daudley) Ltd. Crabtree[1974 ICR 120] it was observed: 'Failure to give reasons amounts to denial of justice. Reasons are live links between the mind of the decision-taker to the controversy in question and the decision or conclusion arrived at.' Reasons substitute subject by objectivity. The emphasis on recording reasons is that if the decision reveals the 'inscrutable face of the sphinx', it can, by its silence, render it virtually impossible for the courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reasons is an indispensable part of a sound judicial system, reasons at least sufficient to indicate an application of mind to the matter before court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while differing with the view taken by the lower authority, not recorded the reasons or had not discussed with regard to arriving at a different conclusion on the merits of the case or the issues involved and the observations have been made. Therefore, all these judgments will not be of any assistance to the appellant. 11. Another facet of the argument canvassed by learned counsel Mr. Oza is that the order of the Tribunal has not reflected the finding in the original order or the order passed by the lower authority, i.e. the Commissioner is also misconceived as the Tribunal has sustained and upheld the order passed by the lower authority and has also confirmed the order passed by the Commissioner and in fact has clearly observed, 17. We further note that Commissioner has come to a categorical finding that scrutiny of the various seized documents like invoices, LRs, delivery challans etc. clearly revealed that the goods, though on paper were shown as having been sold to various intermediaries and ultimately to M/s. L.D. Textile bids. Ltd., the same were removed directly horn the factory of M/s. MPPL and arrived in the appellant's factory on the same very date and no processing wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s each, which is the bone of contention in the present appeal. Penalty on the individuals have been imposed under rule 290A of Central Excise Rules and as discussed above it gives discretion to the authorities and the Tribunal. 13. Therefore, the moot question is whether it can be said that there is any substantial question of law involved, particularly when the order of the Tribunal cannot be said to be non-speaking order when it deals with the merits of the case and the issue involved. Further, it is not in dispute that the discretion is vested in the Tribunal and if it is exercised in a reasonable manner, can it be said to be arbitrary or perverse? Moreover, the Tribunal has not differed with the order passed by the lower authority and has sustained and confirmed the order of the lower authority. Normally, the reasons are required to be recorded as ob served in the judicial pronouncements referred to by learned counsel Mr. Oza for the appellant. When the authority is differing with the views of the lower authorty it is required to record the reasons why it is not accepting or differing with the views of the lower authority which again reflect about the decision making process. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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