Central Administrative Tribunal - Delhi
Amar Kumar Sinha vs Revenue on 11 March, 2025
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CENTRAL ADMINISTRATIVE TRIBUNAL
PRINCIPAL BENCH, NEW DELHI
O.A. No. 1721/2024
Reserved on: 17.12.2024
Pronounced on: 11.03.2025
Hon'ble Mr. R.N. Singh, Member (J)
Hon'ble Mr. B. Anand, Member (A)
Amar Kumar Sinha,
Age 59 years,
S/o Shri Raj Kumar Sinha,
Presently working as Commissioner (Appeals-I)
Office of the Commissioner of Central Tax (Appeals)
TIMC, BMTC, Old Airport Road, Domlur,
Bangalore-560 071 - Applicant
(By Advocate: Mr. S. Sunil)
VERSUS
1. Union of India, Through Secretary,
Department of Revenue,
Ministry of Finance,
North Block, New Delhi-110 001
2. Chief Vigilance Officer,
Central Board of Indirect Taxes & Customs,
Department of Revenue,
Office of Chief Vigilance Officer,
2nd Floor, "Hudco Vishala" Building,
Bhikaji Cama Place, RK Puram,
New Delhi-110 066
(By Advocate: Jalaj Aggarwal)
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ORDER
Hon'ble Mr. B.Anand, Member (A):
The applicant has filed this Original Application under Section 19 of the Administrative Tribunals Act, 1985, seeking the following reliefs:-
"(i) to quash and set aside the Final Order No.5/2024 dated 01.02.2024 issued by the Respondent whereby the authority has imposed the penalty of reduction of pay to a lower stage in the time scale of pay by two stages for a period of one year, with further directions that the applicant will not earn increments of pay during the period of such reduction and after expiry of such period, the reduction will not have the effect of postponing the future increments of pay of the applicant,
(ii) to grant costs of this application to the applicant herein, and
2. Brief undisputed factual matrix of the case is that disciplinary proceedings for major penalty were instituted against the applicant vide Charge Memorandum No. 40/2016 dated 08.11.2016 consisting of two Article of Charges relating to two quasi-judicial orders passed by him, adjudicating two separate Show Cause Notices (SCN) dated 16.05.2008 and 02.08.2010, issued to M/s Keyman Laminators Pvt Ltd and M/s Rimjhim Ispat Ltd. respectively. 3 Dropping of the demands of Central Excise Duty while adjudicating the said Show Cause Notices formed the sole basis of the two charges levelled against the applicant vide Charge Memorandum (supra).
3. Learned counsel for the applicant submits that amongst the two Article of charges leveled against the applicant by the aforesaid Charge Memorandum (supra), only the first Article of charge now survives for consideration by this Hon'ble Tribunal in the Original Application (O.A) because the second Article of charge pertaining to the SCN issued to M/s Rimjhim Ispat Ltd, has been held to be not proved against the Applicant, by the Disciplinary Authority. At this juncture it may be noted that the Inquiry Officer had in fact in his report held both the Articles of charges not to be proved against the Applicant. However, the Disciplinary Authority disagreed with the Enquiry Officer on the first Article of charge and a disagreement note was issued/sent to the applicant vide Memorandum dated 08.09.2020.
4. Learned counsel for the applicant further 4 submits that after receiving the representation of the applicant with regard to disagreement note, the disciplinary authority decided to refer the matter to the UPSC for statutory advice. UPSC tendered their advice vide File No 3/257/2022/SI dated 15.11.2023 advising that ends of justice would be met in the applicant's case if the penalty of reduction of pay to lower stage in the time scale of pay by two stages for a period of one year, with further direction that he will not earn increment of pay during the period of such reduction and after expiry of such period reduction it will not have effect of postponing the future increments of his pay is imposed on him. The applicant represented against the UPSC advice dated 15.11.2023 vide his representations dated 16.12.2023 and 29.12.2023.
5. Learned counsel for the applicant also submits that the Disciplinary authority summarily rejected the applicant's two representations on the ground that no new facts have emerged in the said representations/submissions and, therefore, the same are devoid of merits. Accordingly, the disciplinary authority accepting the advice of UPSC, 5 vide the impugned Final Order No 05/2024 ordered imposition of penalty of reduction of pay to a lower stage in the time scale of pay by two stages for a period of one year with further direction that the Applicant will not earn increments of pay during the period of such reduction and after the expiry of such period, the reduction will not have effect of postponing the future increments of his pay.
6. Learned counsel for the applicant contends that the only article of charge which survives for consideration by this Hon'ble Tribunal, as mentioned above, pertains to the quasi-judicial order passed by the applicant while adjudicating the Central Excise Duty evasion case vide Order-in-Original dated 22.11.2010, booked against M/s Keyman Laminators Pvt Ltd. The said article of charge consisted of four allegations which are as under: -
(i) While adjudicating the Applicant had placed sole reliance on the submissions of the party during personal hearing.
(ii) He has not taken into account the statement recorded by the investigating agency.
(iii) He had not considered the print outs of the 6 data retrieved from the CPU of M/s Anand Sales recovered under Panchnama showing clandestine removal of holographic film on the surmise that the computer (of the seized CPU) was purchased only in the year 2008; no thorough investigation was made to ascertain its genuineness of the invoice produced by the party.
(iv) Invoice was subsequently found to be fraudulent by the investigating agency (DGCEI).
M/s Keyman Laminators Pvt Ltd had admitted clandestine purchase in the proceedings before the Settlement Commission.
7. Learned counsel for the applicant submits that none of the aforesaid allegations would justify initiation of disciplinary proceedings against the Applicant. The Applicant decided the case in favour of M/s Keyman Laminators on a strong reasoning. It cannot be said that the applicant had placed sole reliance on the submissions of the party and ignored the statements recorded by the Investigating agency and the print out alleged to have retrieved from the hard disk of computer of M/s Anand Sales. What has 7 weighed the decision of the Applicant for dropping the demand may be summarized thus: -
(a) The demand of clandestine removal cannot be sustained based on loose slips as well as un-
voluntary statements in the absence of any corroborative evidence as per the law consistently laid down by the Courts and Tribunals from time to time.
(b)No material evidence was brought on record to show that M/s Keyman Laminators Pvt Ltd had obtained raw materials for manufacturing finished goods.
(c) There was no evidence of transportation or procurement of raw-materials by M/s Keyman Laminators Pvt Ltd which would justify unaccounted manufacture.
(d)Computer print-outs which forms the basis of clandestine removal cannot be relied upon as the computer from which the data was retrieved was purchased only in the month of May, 2008 whereas the demand made against M/s Keyman Laminators Pvt Ltd pertained to the period prior to that.
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(e) Requirement of Section 36B of Central Excise Act, 1944 for admissibility of computer print-out as evidence, has not been satisfied in the present case.
(f) The invoice produced by the party during the showing adjudication the purchase of computer in the month of May, 2008 was verified by the Assistant Commissioner, (Preventive) and he has reported the same to be genuine. Under these circumstances, the applicant as an adjudicating authority, could not have disbelieved that the invoices produced by the party during personal hearing are genuine. Apart from this the applicant found that while alleging clandestine removal, no stock taking was carried out by the department in the premises of M/s Keyman Laminators Pvt Ltd
(g) The statement upon which the department had sought to rely upon, had been retracted.
Supreme Court has held in the case of Ravindran @ john Vs Supdt of Customs, 2007 (80) RLT 427 (SC) that other reliable evidences is required to prove the complicity when 9 confessional statements is retracted.
(h) M/s Keyman Laminators Pvt Ltd has cross- examined Shri Swetanshu Dwivedi of M/s Anand Sales during adjudication proceedings.
(i) M/s Keyman Laminators has not admitted clandestine purchase before Settlement Commission. This charge of department is factually/ patently wrong, as M/s Keyman Laminators has not gone to Settlement Commission.
8. Learned counsel for the applicant also pleads that the applicant after duly considering the cross examination, retraction, various binding case laws and invoice showing purchase of computer and the legal position favouring the party decided to drop the demand raised against M/s Keyman Laminators Pvt Ltd.
(ii) The Order-in-Original dated 22.11.2010 (supra) passed by the Applicant as adjudicating authority, dropping the demand of Central Excise duty was carried in appeal by the Department before the Appellate Authority. The Appellate Authority [Commissioner (Appeals)] vide Order-in-Appeal dated 10 27.04.2011 upheld the Order-in-Original dated 22.11.2010 passed by the applicant in toto. The Appellate Authority's order dated 27.04.2011was further carried in appeal before the Hon'ble Customs, Excise & Service Tax Appellate Tribunal [hereinafter referred to as "The Hon'ble Tribunal"]. Before the Hon'ble Tribunal a submission was made by the department that various other Show Cause Notices raising demands and proposing penalties against number of assesses on similar issues were pending adjudication and CBEC [hereinafter referred to as "the Board"] has appointed a Common Adjudicator in the said SCNs. In view of the above-mentioned statement, the Hon'ble Tribunal remanded the matter back to the said Common Adjudicator. The Hon'ble Tribunal in its order dated 14.12.2013 while disposing of the appeal clearly observed that they have not gone into the merits of the case. After a period of almost 13 years, the case has been decided by ADG (DGCEI) vide Order No. 162/2024-CE dated 27.11.2024 [Enclosure-1] issued from F. No. DZU/Adj/AFPL/32/2015 in favour of a group of assesses [M/s Keyman laminators being one of them] 11 on the ground the forensic report of the computer Hard Disk (seized from premises of M/s Anand sales) carried out by Central Forensic Science Laboratory, Directorate of Forensic Science, Ministry of Home Affairs, Hyderabad clearly showed that there was no relevant data found in the suspected digital evidence storage media. Relevant data in the present case refers to the transactions, the basis on which the Show Cause Notice was issued to M/s Keyman Laminators (supra) Therefore, it further establishes the fact that conclusion of the Applicant was correct though based on a different reasoning. In fact, in the remand proceedings all the demands have been dropped by ADG (DGCEI) vide order dated 27.11.2024; based on Forensic report of hard disk seized from M/s Anand Sales against various assesses. It has thus been proved that the department had made a false case against the party based on fabricated documents. This further gets credence by the fact that Forensic report was made available to DGCEI on 24.10.2010, two months before case was adjudicated by the appellant but they kept it hiding and kept pursuing this case based on forged 12 documents for years. This forensic report was revealed to the appellant in 2018 during inquiry proceedings only.
9. On merits, therefore, the order passed by the Applicant was a well-reasoned order on facts as well as on law. Various instructions contained in CBIC Master Circular 1053/02/2017-CX dated 10/03/2017 on adjudication have been scrupulously followed.
10. The impugned Final Order cannot be legally sustained in view of the judicial pronouncements by the Hon'ble Supreme Court and also by the Hon'ble High Court of Delhi where it has been consistently held that quasi-judicial authority cannot be subjected to disciplinary proceedings if the said decision- making process is not effectuated by extraneous considerations. Learned counsel for the applicant relies upon the following decisions-
(i) Sadhna Chaudhary Vs State of Uttar Pradesh & Anr (2020) 11 SCC 760.
In this case, charge sheet was issued to the appellant with regard to two judicial orders 13 delivered by her sitting as an Additional District Judge at Ghaziabad [Para 4 of the judgement]. The appellant replied to the charge-sheet but the Full Court resolved to dismiss the appellant from service and consequently forwarded its recommendation and an order was passed to the effect that the appellant be dismissed from service. The order of dismissal was challenged before the High Court on judicial side invoking the writ jurisdiction.
The Division Bench of the Hon'ble High Court after taking note of the two land acquisition references held that the decision-making process of the appellant while deciding the two land acquisition references were bereft of judicial propriety and settled judicial norms and was actuated by extraneous considerations. The High Court placed emphasis on the windfall gain made available to the claimants as being evidence of the deliberate lapses made by the appellant in response to extraneous considerations and not merely errors of the judgment. The High Court, therefore, concluded 14 that the act of the appellant while passing of the orders in favour of the party, amounted to misconduct.
The matter was carried in appeal before the Hon'ble Apex Court and in para 20 to 27 of the judgement of the Hon'ble Apex Court, gave a detailed consideration of the aspects of misconduct which are reproduced hereunder for ready reference: -
"20. We are also not oblivious to the fact that mere suspicion cannot constitute 'misconduct'. Any 'probability' of misconduct needs to be supported with oral or documentary material, even though the standard of proof would obviously not be at par with that in a criminal trial. While applying these yardsticks, the High Court is expected to consider the existence of differing standards and approaches amongst different judges. There are innumerable instances of judicial officers who are liberal in granting bail, awarding compensation under MACT or for acquired land, backwages to workmen or mandatory compensation in other cases of tortious liabilities. Such relieforiented judicial approaches cannot by themselves be grounds to cast aspersions on the honesty and integrity of an officer.
21. Furthermore, one cannot overlook the reality of ours being a country wherein countless complainants are readily available without hesitation to tarnish the image of the judiciary, often for mere pennies or even cheap momentary popularity. Sometimes a few disgruntled members of the Bar also join 15 hands with them, and officers of the subordinate judiciary are usually the easiest target. It is, therefore, the duty of High Courts to extend their protective umbrella and ensure that upright and straightforward judicial officers are not subjected to unmerited onslaught.
22. It is evident in the case in hand that the High Court itself was cognizant of this settled proposition of law. Learned senior counsel for the appellant also finds no fault with these principles, and instead only seeks for their application to the facts of the present case.
23. It is a matter of record that at the time when the High Court was seized of this matter, writ petitions against both of the appellant's land acquisition judgments had been dismissed by its coordinate benches. The High Court has, nevertheless, rightly observed that dismissal of writ petitions against the appellant's orders did not serve as vindication or confirmation of her orders. Indeed, as correctly noted by the High Court, the scope of judicial review under Article 226 is limited. The standards to be met prior to interference in exercise of writ jurisdiction are very high, and there needs to be gross substantive injustice through the conclusion, glaring irregularities in procedure or the need to resolve important questions of law for a writ court to overturn the Reference Court's order. Hence, dismissal of writ petition merely signifies the failure to demonstrate any of these high standards, in a particular case, and not the endorsement of the orders passed by a subordinate authority.
24. However, the facts of the present case are distinct. This Court, in fact, entered into the merits of one of the allegedly erroneous orders. Not only was the judgment affirmed, 16 but rather the compensation was further enhanced. It hence can no longer be stated that the appellant's order was wrong in conclusion. This fact is significant as it establishes that the increase in compensation by the appellant was not abhorrent.
25. Had the charge been specific that the decision making process was effectuated by extraneous considerations, then the correctness of the appellant's conclusions probably would not have mattered as much. However, a perusal of the charges extracted above makes it evident that the exclusive cause of enquiry, inference of dishonesty as well as imposition of penalty was only on the basis of the conclusion of enhancement of compensation. Given how the challenge to one of those two orders had been turned down at the High Court stage, and the other was both affirmed and furthered in principle by this Court, the very foundation of the charges no longer survives.
26. We can find no fault in the proposition that the end result of adjudication does not matter, and only whether the delinquent officer had taken illegal gratification (monetary or otherwise) or had been swayed by extraneous considerations while conducting the process is of relevance. Indeed, many a times it is possible that a judicial officer can indulge in conduct unbecoming of his office whilst at the same time giving an order, the result of which is legally sound. Such unbecoming conduct can either be in the form of a judge taking a case out of turn, delaying hearings through adjournments, seeking bribes to give parties their legal dues etc. None of these necessarily need to affect the outcome. However, importantly in the present case, a perusal of the chargesheet shows that no such allegation of the process having been 17 vitiated has been made against the appellant.
27. There is no explicit mention of any extraneous consideration being actually received or of unbecoming conduct on the part of the appellant. Instead, the very basis of the finding of 'misbehaviour' is the end result itself, which as per the High Court was so shocking that it gave rise to a natural suspicion as to the integrity and honesty of the appellant. Although this might be right in a vacuum, however, given how the end result itself has been untouched by superior courts and instead in one of the two cases, the compensation only increased, no such inference can be made. Thus, the entire case against the appellant collapses like a house of cards."
11. The Hon'ble Apex Court in the aforesaid judgment has clearly held that had the charge been specific that the decision-making process was effectuated by extraneous considerations, then the correctness of the appellant's conclusions probably would not have mattered as much. However, a perusal of the charges extracted above makes it evident that the exclusive cause of enquiry, inference of dishonesty as well as imposition of penalty was only on the basis of the conclusion of enhancement of compensation. The Hon'ble High Court further holds that there is no explicit mention of any extraneous consideration being actually received or of 18 unbecoming conduct on the part of the appellant. Instead, the very basis of the finding of misbehavior is the end result itself, which as per the High Court was so shocking that it gave rise to a natural suspicion as to the integrity and honesty of the appellant.
12. Therefore, the entire case against the appellant collapses like a house of cards. The Hon'ble Apex Court had, therefore, set aside the dismissal order passed by the Hon'ble High Court and had allowed the prayer to reinstatement of the appellant with consequential benefits including retiral benefits.
13. Learned counsel for the applicant submits that the ratio of the aforesaid case would squarely apply to the applicant's case. In the present case also, there is no allegation of extraneous consideration having been received by the applicant for passing quasi-judicial order. In fact, in the present case also, the order passed by the applicant has been upheld by the Appellate Authority and now reaffirmed in the remand proceedings. If the orders passed while exercising quasi-judicial functioning capacity and dropping the demands against the party, is subjected to 19 disciplinary proceedings, in such a case, even the Appellate Authorities have also to be subjected to disciplinary proceedings on the ground that the order of the original authority has been upheld without accepting evidence placed on record by the Revenue/Department. In the present case, there is no allegation of bias attitude shown towards the assessee while deciding the case and the applicant's order is purely on merits on the basis of law prevailing at the relevant time. The impugned order, therefore, is liable to be set aside on the basis of the aforesaid judgement of the Hon'ble Apex Court.
(ii) Krishna Prasad Verma (D) through LRs Vs State of Bihar & Ors (2019) 10 SCC 640.
[Enclosure-3]
14. In this case also the Hon'ble Apex Court after considering the line of judgements in issue as to whether the disciplinary proceedings could be initiated against the Officer on the basis of quasi- judicial orders passed while functioning as Quasi- Judicial Authority held in para 16 that unless there are clear-cut allegations of misconduct, extraneous influences, gratification of any kind etc, disciplinary 20 proceedings should not be initiated merely on the basis that a wrong order has been passed by the judicial officer or merely on the ground that the judicial order is incorrect.
(iii) Union of ndia Vs Harsh Vardhan Chauhan & Ors (2010) SCC Online Del 4113 [Enclosure-4]
15. The facts of the case are identical to that of the applicant's case in the OA. In this case disciplinary proceedings were initiated against the Officer on the basis of the orders passed while functioning as Commissioner of Customs, Bangalore. Para 14 of the aforesaid judgment has reproduced the charges against the Officer. The Hon'ble High Court of Delhi, after considering all previous decisions such as Union of India Vs K.K. Dhawan (1993) 2 SCC 56, Zunjarrao Bhikaji Nagarkar Vs Union of India (1999) 7 SCC 409, and Union of India Vs Duli Chand (2006) 5 SCC 680, passed its order, the findings of which are reproduced hereunder for ready reference.
"31. As already noted herein above, the respondent made a representation dated 24.02.2009 to the department challenging the validity of the charge sheet issued against him by bringing a subsequent development to the notice of the department, which development had a very material bearing on the validity of the said charge 21 sheet. The development pointed out by the respondent was that the CESTAT had dismissed the appeal preferred by the department against the adjudicating order dated 31.01.2007 passed by the respondent, which order formed the basis of disciplinary action initiated against the respondent. However, the department chose not to pay any heed to the said representation made by the respondent. In such circumstances, the Tribunal was well-justified in testing the correctness of the charge sheet issued against the respondent.
32. Whether the charge sheet issued by the department against the respondent was valid?
33. A reading of Articles of Charges framed against the respondent shows that following two irregularities are stated to have been committed by the respondent
- (i) the respondent acted in a haste manner by proceeding with the matter in question and not awarding the outcome of the appeal preferred by the department against the order passed by the Single Judge of Karnataka High Court, and (ii) the respondent did not correctly appreciate the documentary evidence produced by the department and AEL and REL.
34. Insofar as first irregularity alleged to have been committed by the respondent is concerned, following facts needs to be noted - (i) a specific instruction was issued by Chief Commissioner to the Commissioners to dispose the matters pending over one year by 31,01,2006 and the matter in question fell in the said category. (See the contents of the Office Order dated 21.12.2006 issued by Chief Commissioner, noted in para 8 above), (ii) while admitting the appeal filed by the department for hearing no stay was granted by the Division Bench of Karnataka High Court on the operation of the judgement passed by the Single Judge, (iii) while passing adjudicating order dated 31.01.2007 the respondent took due notice of the factum of pendency of the appeal filed by the department and safeguarded the interests of the department by directing that the surety bonds executed by AEL and REL shall be released to them only after dismissal of the appeal filed by the department, (iv) letter dated 24.08.2007 issued by Joint Director General of Foreign Trade impliedly provided implementation of the judgement passed by the Single Judge as no stay could be obtained by the 22 department on the operation of the said judgement and (v) the CESTAT found nothing irregular in the approach of the Tribunal in proceeding with the matter in question pending the disposal of the appeal filed by the department before the Division Bench of Karnataka High Court. (See the contents of paras 8.2 and 8.3 of the order passed by the CESTAT, noted in foregoing paras). In the teeth of said facts, by no stretch of imagination, it can be said that the respondent acted in a haste manner in proceeding with the matter in question and no awaiting the outcome of the appeal filed by the department. Consequently, the department was wholly unjustified in issuing a charge sheet against the respondent in respect of Article 1.
35. As regards Article II framed against the respondent is concerned, suffice would be to state that grounds similar to irregularity (ii) were raised by the department before the CESTAT. (See the contents of paras 4.3, 7, 9.1 and 9.2 of the order of the CESTAT, noted in foregoing paras). After examining the adjudicating order passed by the respondent in great detail, the CESTAT did not find any merit in the said grounds raised by the department and held that the respondent had correctly appreciated the documentary evidence adduced by the department and REL and AEL. (See the contents of para 9.3 of the order of the CESTAT, noted in foregoing paras). In such circumstances, the department was wholly unjustified in issuing a charge sheet against the respondent in respect of Article II.
36 It is apparent that an adjudication order passed by the respondent while exercising quasi-judicial power was the foundation of the charge sheet and shorn of technicalities, at the heart of the charge was the allegation that the order was passed contrary to law to confer benefit upon the assessees. Meaningfully read, the charge sheet seeks to inculpate the respondent with reference to his acts performed in a quasi-judicial function and thus we hold that the Tribunal has returned a correct verdict."
16. Learned counsel for the applicant submits that a reading of the aforesaid judgement would reveal that 23 the Hon'ble High Court has taken serious note of the fact that adjudication order passed by the respondent while exercising as quasi-judicial power was the foundation of the charge sheet and shorn of technicalities, at the heart of the charge was the allegation that the order was passed contrary to law to confer benefit upon the assessees. The Hon'ble High Court thus quashed the Charge Sheet holding that the charge sheet has sought to inculpate the respondent with reference to his acts performed in a quasi-judicial function.
17. Learned counsel for the applicant submits that in the light of the aforesaid judgment, the impugned final order deserves to be set aside and the OA has to be allowed with consequential reliefs by directing the respondents to open the sealed cover and to give effect to the recommendation of the DPC proceedings, it is prayed accordingly,
18. Learned counsel for the respondents has filed the written submissions in which it is stated that the applicant, then Additional Commissioner (Now commissioner) while exercising his quasi-judicial 24 power adjudicated a duty evasion case booked against M/s Keyman Laminators Pvt. Ltd., 66-B, Dada Nagar, Kanpur by DGCEI, Kanpur. M/s Keyman Laminators Pvt. Ltd. was engaged in the manufacture of Printed and Laminated poly film rolls and printed and laminated pouches etc. A Show Cause Notice demanding Central Excise duty amounting to Rs. 43,73,131/- was issued by DGCEI, DZU, New Delhi, on unaccounted three layer printed flexible packaging materials, clandestinely manufactured from unaccounted I.D films and holographic film under Section 11A (1) of the Central Excise Act, 1994. While adjudicating, the applicant placed sole reliance on the submissions of the party during the personal hearing and did not take into account the statements recorded by the investigation agency. He had also not considered the printouts of the retrieval of data showing clandestine clearance of holographic film from the CPU of M/s Anand Sales, under Panchnama on the surmise that the computer (of the seized CPU) was purchased in 2008 on the basis of the receipt of purchase of computer, regarding which thorough investigation was not made to ascertain its 25 genuineness, The same receipt was found fraudulent by DGCEL. Whereas, M/s Achyut Packaging have accepted the clandestine removal of LD Film to M/s Keyman and M/s Keyman have also admitted clandestine purchase of the same before the Settlement Commission. The applicant also adjudicated the SCN dated 16.05.2008 issued by the DGCEI to M/s Rimjhim Ispat Ltd., who were engaged in manufacture of SS Steel Ingots/Billets, SS Flats and other products of Iron and Steel wherein the DGCEI had requested that the SCN may be kept pending till issuance of the final SCN. A second SCN dated 06.02.2009 was also issued by the DGCEL in the matter after completing the investigation which was answerable to the Commissioner. The applicant proposed that the two SCNs be clubbed together and adjudicated by the Commissioner in view of CBEC Circular No. 752/68/2003-CEX dated 01.10.2003 and 362/78/97-CEX dated 09.12.1997. However, he adjudicated the SCN dated 16.05.2008, vide 0-1-0 No. 05/ADC/2009 dated 14.07.2009, in excess of his adjudication powers, on the ground that the said goods had not reached the stage of marketability 26 because they could not pass quality control test and were being accumulated over a period of time in a segregated manner, and taking this view adjudicating authority ordered for re-melting of the same under supervision of the Range Officers. The applicant, Additional Commissioner, by adjudicating the SCN dated 16.05.2008 has acted in excess of his adjudication powers, thereby making the O-I-O passed by him void ab-Initio; by not referring to the detailed modus operandi of the party, as elucidated in the second main SCN, he has passed the adjudication order without fully taking into account all the evidence collected and collated by the Investigating agency, thereby, erroneously dropping the demand and jeopardizing the duty. Based on the First Stage Advice by CVC, departmental proceedings for major penalty were instituted against the applicant (Commissioner) under Rule 14 of CCS (CCA) Rules, 1965 vide Charge Memorandum No. 41/2016.
19. In this regard, the learned counsel for the respondents has placed reliance on the judgment of the Hon'ble Supreme Court in Union of India and Ors. vs K. K. Dhawan (1993 AIR 1478, 1993 SCR (1) 27
296) holding that, "On the question, whether an authority enjoys immunity from disciplinary proceedings with respect to matters decided by him in exercise of quasi-judicial functions; allowing the appeals, this Court, HELD:
"The disciplinary action can be taken in the following cases:
(i) Where the Officer had acted in a manner as would reflect on his reputation for integrity or good faith or devotion to duty;
(ii) there is prima facie material to show recklessness or misconduct in the discharge of his duty;
(iii) if he has acted in a manner which is unbecoming of a government servant:
(iv) if he had acted negligently or that he omitted the prescribed conditions which are essential for the exercise of the statutory powers,
(v) if he had acted in order to unduly favour a party.
(vi) if he had been actuated by corrupt motive however, small the bribe may be because Lord Coke said long ago "though the bribe may be small, yet the fault is great."
The instances above catalogued are not exhaustive. For a mere technical violation or merely because the order is wrong and the action not falling under the above enumerated instances, disciplinary action is not warranted. Each case will depend upon the facts and 28 no absolute rule can be postulated. There is a great reason and justice for holding in such cases that the disciplinary action could be taken. It is one of the cardinal principles of administration of justice that it must be free from bias of any kind. The officer who exercises judicial or quasi-judicial powers acts negligently or recklessly or in order to confer undue favour on a person is not acting as a judge."
20. In the same judgment the Hon'ble Apex Court also observed that:
"It is manifest, therefore, that though the propriety and legality of the sanction to the leases may be questioned in appeal or revision under the Act, the Government is not precluded from taking disciplinary action if there is proof that the Commissioner had acted in gross recklessness in the discharge of his duties or that he failed to act honestly or in good faith or that he omitted to observe the prescribed conditions which are essential for the exercise of the statutory power. We see no reason why the Government cannot do so for the purpose of showing that the Commissioner acted in utter disregard of the conditions prescribed for the exercise of his power or that he was guilty of misconduct or gross negligence"
21. In a judgment dated 12th July 2016 in R.P. Parekh's case (Civil Appeal Nos. 6116 6117 of 2016), the Supreme Court has prescribed the procedure/principles to be followed while examining 29 the case against an officer exercising judicial/quasi- judicial function. The relevant para 15 of the judgment is reproduced below: The issue of whether a judicial officer has been actuated by an oblique motive or corrupt practice has to be determined upon a careful appraisal of the material on the record. Direct evidence of corruption may not always be forthcoming in every case involving a misconduct of this nature. A wanton breach of the governing principles of law or procedure may well be indicative in a given case of a motivated, if not reckless disregard of legal principle. In the absence of a cogent explanation to the contrary, it is for the disciplinary authority to determine whether a pattern has emerged on the basis of which an inference that the judicial officer was actuated by extraneous considerations can be drawn. Cases involving misdemeanours of a judicial officer have to be dealt with sensitivity and care. A robust common sense must guide the disciplinary authority. At one end of the spectrum are those cases where direct evidence of a misdemeanour is available. Evidence in regard to the existence of an incriminating trail must be 30 carefully scrutinized to determine whether an act of misconduct is established on the basis of legally acceptable evidence. Yet in other cases, direct evidence of a decision being actuated by a corrupt motive may not be available. The issue which arises in such cases is whether there are circumstances from which an inference that extraneous considerations have actuated a judicial officer can legitimately be drawn. Such an inference cannot obviously be drawn merely from a hypothesis that a decision is erroneous. A wrong decision can yet be a bona fide error of judgment. Inadvertence is consistent with an honest error of judgment. A charge of misconduct against a judicial officer must be distinguished from a purely erroneous decision whether on law or on fact. The Supreme Court in R P Parekh case has laid down the following conditions/procedure to be followed to determine as to whether an act of a judicial officer has been actuated by an oblique motive or corrupt practice:
(i) Since, direct evidence of corruption may not always be forthcoming in every case involving a misconduct, a want on breach of the governing principles of law or procedure may well be indicative in a given case of a motivated, if not reckless disregard of legal 31 principle.
(ii) In the absence of cogent explanation, it is for the disciplinary authority to determine whether a pattern has emerged on the basis of which an inference that an officer was actuated by extraneous considerations can be drawn.
(iii) The disciplinary authority has to determine whether there has emerged from the record one or more circumstances that indicate that the decision which form the basis of the charge of misconduct was not an honest exercise of judicial power.
(iv) A charge of misconduct against a judicial officer must be distinguished from a purely erroneous decision whether on law or on fact.
22. Learned counsel for the respondents submits that in view of the above facts and circumstances of the instant case already discussed in detail in the Charge memorandum dated 08.11.2016, there is a reasonable ground to believe that in the instant case the applicant has exhibited recklessness in performance of his duties. In support of that, the learned counsel for the respondents has also relied upon the judgment of the Hon'ble Supreme Court in the case of K.K. Dhawan (supra) wherein it is held that the disciplinary action can be taken if there is prima facie material to show recklessness or misconduct in the discharge of his duty. He has, 32 thus, prayed for dismissal of the OA.
23. We have heard the submissions of the learned counsel from both the sides and with their assistance, carefully gone through the available records.
24. Learned counsel for the applicant has stated that the decision taken by a quasi judicial authority during the discharge of his duties cannot be questioned by superior authority. In support of that, the decisions quoted by the learned counsel for the applicant in the matter of Sadhna Chaudhary (supra) and Krishan Prasad Verma (D) (supra) are of no help to the applicant as the same pertain to the orders passed by the judicial officers and not by a quasi judicial authority as in the present OA; however, there is no conclusive evidence of having demanded or accepted any illegal gratification in the discharge of quasi judicial proceedings by the applicant is a point in his favour which can be taken from the above two judgments, namely in the cases Sadhna Chaudhary (supra) and Krishan Prasad Verma (D) (supra).
25. Moreover, the decision of the Hon'ble High Court of Delhi in the matter of Harsh Vardhan (supra) relied upon by the applicant is squarely applicable to the 33 case in hand as in that case also, allegations were leveled against the officer who was discharging the quasi judicial functions like the applicant in present case.
26. While perusing the written submissions filed by the applicant, it is seen that the issue, which was adjudicated by the applicant vide his order dated 22.11.2020 which forms the basis of the disciplinary action taken against him by the respondents, was taken in appeal before the Appellate Authority [Commissioner (Appeals)] who also affirmed the aforesaid order passed by this applicant in toto, by passing an order dated 27.04.2011. The Appellate Authority's order dated 27.04.2011 was further carried in appeal before the Customs, Excise & Service Tax Appellate Tribunal [hereinafter referred to as "the CESTAT"]. Before the CESTAT, a submission was made by the department that various other Show Cause Notices raising demands and proposing penalties against number of assesses on similar issues were pending adjudication and CBEC [hereinafter referred to as "the Board"] has appointed a Common Adjudicator in the said SCNs. In view of the above-mentioned statement, the CESTAT remanded the matter back to the said Common Adjudicator. The CESTAT 34 in its order dated 14.12.2013 while disposing of the appeal clearly observed that they have not gone into the merits of the case. After a period of almost 13 years, the case has been decided by ADG (DGCEI) vide Order No. 162/2024-CE dated 27.11.2024 issued from F. No. DZU/Adj/AFPL/32/2015 in favour of a group of assesses [M/s Keyman laminators being one of them) on the ground the forensic report of the computer Hard Disk (seized from premises of M/s Anand sales) carried out by Central Forensic Science Laboratory, Directorate of Forensic Science, Ministry of Home Affairs, Hyderabad clearly showed that there was no relevant data found in the suspected digital evidence storage media. Relevant data in the present case refers to the transactions, the basis on which the Show Cause Notice was issued to M/s Keyman Laminators (supra) Therefore, it further establishes the fact that conclusion of the Applicant was correct though based on a different reasoning. In fact, in the remand proceedings all the demands have been dropped by ADG (DGCEI) vide order dated 27.11.2024; based on Forensic report of hard disk seized from M/s Anand Sales against various assesses. It has thus been proved that the department had made a false case against the party based on fabricated 35 documents. This further gets credence by the fact that Forensic report was made available to DGCEl on 24.10.2010, two months before case was adjudicated by the appellant but they kept it hiding and kept pursuing this case based on forged documents for years. This forensic report was revealed to the applicant in 2018 during inquiry proceedings only.
27. Thus, it is seen that the respondents have rightly not taken any action against the appellate authority as the same is the appellate authority for the applicant in the matter that he had adjudicated upon. It is also seen that the appellate authority has not only affirmed the decision taken by the applicant but those decision were taken before the CESTAT which has not chosen to quash the same and the department was only taken the help of arbitrators for the present case in hand as also other similar cases. Thus, by no stretch of imagination, it can be said that the applicant has discharged his official duties in a careless and negligent manner as to warrant the disciplinary action being taken against him and thus, the decision of the Hon'ble Supreme Court in K.K. Dhawan (supra) relied by the respondents on the ground that there is prima facie material to show recklessness or misconduct in the 36 discharge of duty by the applicant is not attracted in the present case due to the reasons enumerated in paras 26 and 27 of this order.
28. In view of the above, we allow the OA by quashing and setting aside the final order No.5/2024 dated 01.02.2024 issued by the respondents. There shall be no order as to costs.
(B. Anand) (R.N. Singh) Member (A) Member(J) /lg/