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TMI Blog2022 (9) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... how cause notice and submission of reply thereto is justified in taking the view that the reply had been accepted and the authorities had given a quietus to the matter. Maintainability of petition - availability of alternative remedy - HELD THAT:- Even though the remedy of Appeal is available, Petitioner is not required to exercise this alternate remedy in the facts and circumstances of the present case. The present Writ Petition is maintainable as the challenge in the present Writ Petition arises on account of the contravention of the rules of procedural fairness by Respondent. This conduct of Respondent as already held by us has resulted in grave prejudice being caused to Petitioner and amounts to a violation of the principles of natural justice. Thus, the present Writ Petition is squarely maintainable and Petitioner does not have to be relegated to the remedy of Appeal even though available. Petition allowed. - WRIT PETITION (L) NO. 21447 OF 2022 - - - Dated:- 5-8-2022 - K. R. SHRIRAM A. S. DOCTOR, JJ. Mr. Arshad Hidayatullah, Senior Advocate a/w Mr. Darius Shroff, Senior Advocate, Mr. Anupam Dighe, Ms. Shailaja Kher, Mr. Makarand Joshi and Ms. Chandni Tanna i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est and bad in law. Petitioner referred to and relied upon several judgements of this Hon ble Court in support of the contention that since the show cause notices had not been acted upon within a reasonable period of time, the same were now stale and consequently any adjudication based thereon was bad in law and void. Petitioner thus requested Respondents to withdraw the impugned notices. 6. Respondents did not reply to Petitioner s letter but instead, after a period of over five months fixed another date for personal hearing on 11th March, 2022. Petitioner s representative attended the personal hearing before Respondent No. 3 and inter alia submitted: a. that Respondent No. 3 did not have jurisdiction to continue the proceedings since the inquiry was in respect of show cause notices which were over 13 years old. b. that the records pertaining to the case at hand were destroyed and/or untraceable. c. that the officers of Petitioners acquainted with the facts of the case were no longer in Petitioners employment. d. that grave prejudice would be caused to Petitioners if the impugned notices were adjudicated upon after such an inordinately long time. 7. Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t matter of the impugned notices been destroyed and/or become untraceable and (b) the concerned officers of Petitioner who were conversant with the facts of the case were no longer in the employment of Petitioner. Thus, the sudden resurrection of the impugned notices after well over a decade without informing Petitioner that the same had been transferred to call book had put Petitioners in a position of irretrievable prejudice. He submitted that it would therefore be wholly inequitable if Respondents were permitted to take advantage/benefit from the very position of irretrievable prejudice in which they had put Petitioners in to begin with. c. Our attention was then invited to the judgment of this Hon ble Court in the case of Parle (supra) with particular reference to the following paragraphs and it was submitted that the facts of the present case were squarely covered by the same, viz. 23. In the present case, it is evident that the delay in adjudication of the show-cause notices could not be attributed to the petitioner. The delay occurred at the hands of the respondents. For the reasons mentioned, respondents have kept the show-cause notices in the call book but witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raphs, viz. 6. We specifically asked Mr. Jetly, Learned Counsel appearing for the Revenue, whether any intimation was given to the petitioners either in 2001 or in 2013 that the show cause notices are being kept in the call book and the reason for it i.e. awaiting a final decision in the CERA audit objection and / or the decision in the Apex Court in the appeal filed by the Revenue from the order of the Tribunal in case of petitioners' Indore and Bhopal Unit. Mr. Jetly very fairly states that no intimation of keeping the show cause notices in the call book was given. Thus, the occasion to give any reasons for it being kept in the call book to the petitioner did not arise. 7. In the aforesaid facts, the issue that arises for our consideration is whether in the present facts, commencement of adjudication proceedings after a long delay of 14 to 17 years is justified when the party in all these years has not been put to notice that the proceedings were kept in abeyance. In fact, this Court, in the case of Bhagwandas Tolani (Supra) decided as far back as 1982, has held that even if there is no time limit provided in the statute for adjudication proceeding, yet it is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be in their service any longer. Thus, they would have no opportunity, much less reasonable and fair, to defend the proceedings. That is equally a balancing factor in the facts and circumstances of the present case. 9. In the present facts, it is the case of the petitioner that because of long delay, papers and proceedings relevant to meet the show cause notice are not available. Thus, seriously hampering the petitioners to appropriately meet the show cause notice. This delay in taking up the adjudication of the show cause notice (in the absence of any fault on the part of the party complaining) is a facet of breach of principles of natural justice. It impinges on procedural fairness, in the absence of the party being put to notice that the show cause notices will be taken up for consideration, after some event and / or time, when it is not heard in a reasonable time. In the absence of the above, particularly as in this case, long delay has resulted in papers being misplaced. The reasonable period may vary for case to case. However, when the notices are being kept in abeyance (by keeping them in the call book as in this case), the Revenue should keep the parties informed of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an 13 years old and as such the Notices are to be considered non est. This is settled law and it has been consistently held by the Courts, that commencing adjudication process, after a long delay of 13 years, from the date of issuing the show cause notice, as is in the present case, is bad in law. b) We further submit that we were under the reasonable belief that the Department was not interested in pursuing the matter covered by the above notices and had abandoned the issue raised therein. c) We submit that commencing with these proceedings after a period of 13 years would be in violation of the principles of natural justice, as we were never informed by the Department for all these years, that the said matters are kept alive and it would cause grave prejudice to us, as we are not in a position to trace the relevant records on which we would want to rely in support of our case. Even the personnel who were handling these matters have long since retired and hence it would be unjust to proceed with the captioned Notices, after so many years and in direct conflict of the Principles of Natural Justice. d) The above view has been consistently held by the Hon ble High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting a judgment. A judicial order is obviously required to deal with the authorities cited in a manner that reflects application of mind, but it is not always the case in respect of an order of the present nature. If at all, we would view the omission of the Commissioner not to separately deal with the authorities cited as something like an error committed within jurisdiction which is not the same as acting in excess of jurisdiction. Such error, if required, can be corrected by the Tribunal if at all the same is approached. We, therefore, do not propose to hold that the order impugned suffers from a violation of principles of natural justice. There is no ground of substance to entertain this writ petition despite the statutory remedy of appeal being available to the petitioner. (emphasis supplied) In light of the above, even assuming Respondent No. 3 had failed to adequately deal with the authorities cited by Petitioner the same was an error which was within the jurisdiction of Respondent No. 3 and thus one which was capable of being redressed in Appeal. In the facts of the present case, Petitioner had wrongly invoked the extraordinary jurisdiction of this Hon ble Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after an inordinately long delay was reason enough to render the same invalid and any order passed based thereon, void. 11. We have heard the submissions of learned counsel appearing for both sides as also considered the case law relied upon by them. We have no hesitation in holding that the present Petition deserves to be allowed for the following reasons, viz., A. The law pertaining to adjudication of show cause notices is now well settled by various judgments, in particular Raymonds (supra) and Parle (supra) of this Hon ble Court, from which the following can be culled out, viz., i. Even where the statue does not prescribe a time limit for adjudication, a show cause notice must be adjudicated upon within a reasonable time; ii. Though reasonable time is flexible and would depend upon the facts and circumstances of each case, since the object of issuing a show cause notice is to secure and recover public revenue, larger public interest requires that revenue authorities act diligently and expeditiously when adjudicating the same; iii. Diligence would include keeping the answering party informed when a show cause notice is kept in abeyance/transferred to ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iv. No delay was occasioned on account of Petitioner. In light of the above, we find that the adjudication of the impugned notices by Respondent No. 3 in the present case was clearly bad in law and consequently the impugned order is also void. Respondent No. 3 had taken up the impugned notices for adjudication after a period of thirteen years from the date of issuance thereof and after submission of reply. This by all counts is well beyond the reasonable period of time in which Respondents were expected and required to act. Additionally, Respondents did not inform Petitioner that the impugned notices had been transferred to call book this coupled with the sudden resurrection of the impugned notices after over a decade has impinged on procedural fairness and put Petitioners in a position of irretrievable prejudice. The principles of natural justice and fair play in this case have clearly been violated by Respondents. Though Respondents have contended that the impugned notices were transferred to call book as per the circular of the Board, we find that even the Affidavit in Reply does not mention either the date on which the impugned notices were so transferred, nor does it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Hover Automotive India Pvt. Ltd. (supra) is also wholly inapplicable to the facts of the present case. The only challenge in the case of Hover Automotive India Pvt. Ltd. (supra) was one which pertained to failure of the authority (in that case) to properly construe and deal with certain judgments cited before it. The challenge in the present case, however, is one which pertains to the grave prejudice caused to Petitioner on account of the violation of the principles of natural justice occasioned by Respondents conduct in re-opening adjudication proceedings after an inordinate delay. It has now been conclusively held that such conduct on the part of revenue authorities is in contravention of procedural fairness and thus in violation of principles of natural justice and is therefore amenable to challenge by way of a writ jurisdiction. Infact, a careful reading of the judgment in the case of Hover Automotive India Pvt. Ltd. (supra) also specifically sets out that writ jurisdiction can always be invoked and is available to a party when there is any contravention of the principles of natural justice. It is useful to reproduce here paragraph 13 from the judgment of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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