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TMI Blog1993 (9) TMI 219X X X X Extracts X X X X X X X X Extracts X X X X ..... giving any opportunity to the investigation (department) to enquire into these documents before they are taken on record and they were acted upon for drawing conclusions adverse to the department. He assured that he would not go into the merits of the case touching on classification or valuation, but would confine himself only to the grounds for urging a remand. 3.1 Alongwith the appeal, a stay application was also moved by the Collector. This was listed for hearing on 8-6-1993, which was adjourned at the request of the Consultant representing the respondents (vide his application dated 4-6-1993). It was fixed for hearing on 19-7-1993. 3.2 On that day, none was present on behalf of the respondents, though we were told by the Bench Clerk that a message was received that someone would attend hearing. We waited till the end of the board and finally took up this matter. At that time, the ld. S.D.R. made the above request with a plea for consideration of these grounds and an ad interim direction was given to both the sides for not disturbing the status quo, till the appeal was heard on the short grounds, (vide our Order No. 307/93-WRB, dated 19-7-1993). 3.3 In pursuance of this d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce from dates earlier than the effective dates declared in their price lists. (v) have claimed certain deductions wrongly, where goods were sold ex-factory at the prices. On the basis of the S.C.N. detailing the evidences for each of the allegation, which included not merely the statements but also sales invoices vis-a-vis corresponding gate passes to show grade A L.D.P.E. being invoiced against corresponding excise G.P. showing it as grade B, evidences to establish clearance of L.D.P.E. as master batches, adjudication proceedings were held by the Collector. A number of personal hearings were given, the officers of Directorate of Anti-evasion were also present for representing the interests of the department. He referred to personal hearing proceedings to confirm this position. The personal hearing proceedings were over on 12-3-1992. In so far as hearings are concerned curtain was finally drawn on 12-3-1992. Thereafter a letter dated 27-3-1992 written by the Chairman and Managing Director was taken on record by the Collector, without getting the comments on the factual position from the department. This letter has been received on 6-4-1992 and the impugned order was passed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent s contention that no testing was done by the department at the production stage before accounting and there are no scientific system of grading. Even the finding is contrary to the factual position that the respondent have been selling them in two different grades at different prices and the allegation based on the above evidences is that grade A granules were cleared as grade B but actually invoiced as grade A to the customers. Hence the question of testing is not the material factor to reject these evidences. 4.4 The respondents themselves have admitted in their letter to the Chairman CBEC about short levy to the extent of Rs. 1.75 crores and deposited this. Even the Collector has taken note of this. Hence there is no warrant to send back the issue of finalising provisional assessment to the Assistant Collector and refrain from imposing any penalty for the admitted evasion. 4.5 In fine, he pleads that - (i) the Collector has allowed introduction of certain invoices (which are prima facie of suspect nature) without any investigation and allowed himself to be influenced in his findings by photo copies of these documents, without giving any opportunity to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to be answered by the Tribunal and hence this Bench is lacking in jurisdiction to deal with these questions and hence could not have heard the appeal on the short grounds now pleaded by S.D.R. He is only a mouthpiece. The statutory authority for filing the appeal is the Collector and the direction of the Board is in exercise of the powers conferred under Section 35E. Hence, the present hearing of the appeal on the short grounds is going beyond the order passed by the Board under Section 35E. (v) The Tribunal seems to have passed the interim order No. 307/93 dated 19-7-1993 in a hurry and it is a drastic order, passed against the respondents without hearing them. (vi) Provisions of Section 35(4) only indicate that such application filed by the department is to be treated as an appeal against the decision. That does not make the department an appellant in a regular appeal. Hence pleadings on violation of natural justice cannot be entertained. In any case points raised in the Board s order only can be entertained and the Bench cannot go beyond these, since the Bench (Regional Bench) has only a limited sphere of delegated power for dealing with Special Bench matter, disposal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He has asked the Assistant Collector to finalise the provisional assessments and determine the short levy and their penal liability is also kept open. Their deposit of Rs. 1.75 crores is locked up in the process, though other major allegations have been dropped by the Collector. He therefore does not understand how the department s interests have been affected by the order. This appeal is motivated at the behest of Anti-evasion Wing, who are interested in their rewards. (ix) In fine, he pleads that the present prayer for remand does not emanate from the order of the Board passed under Section 35E and is not within the jurisdiction of the Bench to decide on this question raised. Hence he pleads that on the short grounds, appeal may not be decided and let the questions referred to by the Board be decided by the Special Bench in due course. 6. Shri Mondal, in reply, countered these arguments and pleaded that the points canvassed are well within the jurisdiction of the Regional Bench, viewed in the context of the President delegating certain functions to the Regional Benches in the cases relating to Special Benches. He referred to the Public Notice issued by the President delegati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintain the status quo, till the matter is heard from both sides. We agreed to this request and direct the registry to list the appeal for hearing on 18-8-1993. We also note that Shri Mondal has pleaded that the short grounds do not touch on the question of valuation, classification for determination. Till the hearing of the appeal on the short ground, the status quo should not be disturbed by either side." 7.3 From the above, it is clear that though Shri Mondal pleaded on certain short grounds, we did not like to express any opinion on them in the absence of the respondents. But taking into account his prayer for hearing the appeal on certain short grounds, we directed the Registry to list the appeal for hearing on certain short grounds, and issue notice to both the sides, so that a final view on the short grounds could be had only after hearing the respondents. How the ld. Consultant terms this as a drastic order causing prejudice to the respondents? Even the status quo maintenance by either side cannot be said to cause any prejudice to the respondents, because they have not moved any petition or cross appeal opposing the appeal of the revenue and stay petition, which we f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onvenience of disposal, have constituted the Regional Benches, as Special Benches in regard to certain cases. They are enumerated in the Public Notice No. 4/86 dated 14-10-1986 in three categories A , B C . All these relate to matters concerning Special Benches but could be disposed of by this Regional Bench. Shri Mondal pleads that this Bench has jurisdiction to dispose of the appeal, in terms of S. No. 6 under category A of the above Public Notice, which is reproduced below: cases where the matters, in the opinion of the Bench, are to be remanded to the lower authorities on the ground of denial of natural justice, non-issue of S.C.N., denial of opportunity of personal hearing or relying upon evidence not disclosed to the appellants (emphasis supplied by him). Since the request from Shri Mondal is only limited for remand of the case on the main ground of non-disclosure of certain documents obtained from the respondents otherwise through normal official channel and taken into record for reliance, without disclosing it to the department, the case calls for a remand. Prima facie, such a request falls within the purview of this Bench, as per the delegation of powers cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o grade A, as is reflected in the corresponding invoices, which has not been considered by the Collector either for a acceptance or for rejection. This point goes into the merits of this case and cannot be a short ground and in fairness to Mondal, he did not ask us for determining the point, though prima facie the Collector s findings do not reveal any discussion on these plant records and invoices. (ii) Para 6D and sub-paras thereto relate to clearance of LDPE granules carrying higher rate of duty by declaring it as master batch carrying lower rate of duty. In this para, specific points are made alleging that the Collector had accepted invoices for the purchase of 117.750 M.T. of Titanium Dioxide for the period April 1990 to July 1990. Photocopies of the invoices taken on record in the adjudication file account only for a quantity of 36.750 M.T. of Titanium dioxide. It is also not clear as to when these were produced and under what covering letter they were taken on record. There are no endorsements of verification of original invoices found in the photocopies. The original purchase order No. 20090 dated 6-4-1990 is for purchase of Acetone-10 MT. The documents taken on record ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he points raised in the Board s order and cannot overlook them. We have no dispute over this proposition, if the appellant seeks for disposal of the appeal for considering all the points, in which case we would not have entertained hearing of the appeal but bundled this file out to Delhi. It is open for any appellant to urge only a particular point covered in the ground of appeal and seek for disposal only on that ground, without pressing other grounds. Here, Shri Mondal has meticulously avoided raising any ground touching classification or valuation. He only seeks for a remand on the short ground of introducing certain documents (alleged to be appearing suspect) which have been relied upon without any investigation thereon and adverse findings have been given by the Collector against the department. Are we justified in rejecting the prayer, especially when no effective rebuttal of the factual position regarding the introduction of invoices relating to Titanium dioxide without making them available for investigation is forthcoming from the ld. Consultant for the respondents? Despite various legal arguments, the factual position stated by SDR has not been rebutted by the respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents or investigation. As against these arguments, we observe that the principles of natural justice means fair play in adjudication. It is open for the department to ensure representation from their side during adjudication. There is a lis between the Department and the assessee, the moment a S.C.N. is issued for adjudication. Lis does not spring out of the pleas only during appeal. This is the view held by us in the case of Lakhanpal - 1992 (62) E.L.T. 46 (Tri.) = 1993 (48) ECR 166. This view of ours upholding the Department s right to be represented in adjudication before the Collector in proceedings under Section 11A has also been prima facie upheld by the Bombay High Court in the same case. [vide para 5 -1993 (63) E.L.T. 61 (Bom.) = 1993 (44) ECR 150 (Bom.)]. We also are given to understand that the appeal against this prima facie order of Bombay High Court has been rejected by the apex court. Hence in the lis between the department and the respondents before the adjudicator, when there are evidences to show the participation of Director (Anti-evasion) as representing the department, it would not be fair, where certain documents have been taken on record after the pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lied upon, cross examination by the respondents may be extended in respect of such witnesses desired and named by the respondents. If the affidavits of certain persons are sought to be relied upon, the department s representative if desired by him, may be given an opportunity to examine the deponents. After complying with all these required necessities and after due hearing given to the respondents he may pass a speaking order in accordance with law, discussing the evidences cited in the S.C.N. as well as those presented by the respondents. 10. Before parting, for the sale of record, we are to consider one more argument of the ld. Consultant. He pleads that the Departmental Representative is only the mouthpiece of the Collector/the Board and he cannot pick and choose the grounds. If the Departmental Representative is the mouthpiece of the Collector, so also the ld. Consultant is the mouthpiece of the respondents. Both are to act under the instructions from the parties, they represent. It is not open for us to shut the mouthpiece of the Collector nor is it open for us to urge him to press all the grounds or only certain grounds mentioned in the appeal. On instructions from the Col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the record of adjudication proceedings and on being satisfied, to order filing of an appeal before the CEGAT, and vide sub-section (4) of the said section, the application made to the CEGAT thereunder has to be treated as if such application were an appeal made against the decision or order of the adjudicating authority and the provisions of this Act regarding appeals, including the provisions of sub-section (4) of Section 35B so far as may be, apply to such application . The logical conclusion that is apparent, is that all the grounds available to the assessee-appellant before the Tribunal, to plead, are also available to the applications filed by the Department pursuant to the directions vide Section 35E(1) of CESA. 14. Non-compliance with the principles of natural justice is one of the grounds available to the assessee-appellant, to plead for setting aside the order of the adjudicating authority. This ground is, by settled position of law, deemed to be an issue of law, and can be raised at any time during the hearing of an appeal. That does not involve adducing of any additional evidence so as to be discarded or not entertained as an issue of fact or requiring further scr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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