Calcutta High Court
Matigara Rolling Mills (P) Ltd. vs Commissioner Of C. Ex. on 19 September, 2005
Equivalent citations: 2006(193)ELT132(CAL)
Bench: D.K. Seth, Maharaj Sinha
ORDER
1. In this case, the assessee's undertaking was closed sometimes in 2001. Mr. Khaitan submits that information of such closure was furnished to the Central Excise authorities.
2. In relation to the certain proceedings, an adjudication order was passed, which was supposed to be served on the assessee at the address of the closed undertaking. However, subsequently, the copy was served by the assessee on being informed over phone from the office of the authority and within 60 days thereof an appeal was preferred before the Commissioner of Appeals. But that was rejected on the ground of being barred by limitation since preferred long after 90 days from the date of the alleged service of the order of adjudication on the basis of a postal remark 'Refused' endorsed on the envelop, sent by the Department at the address of the closed undertaking through post. The question arose as to whether the said refusal could be treated to be the service within the meaning of Section 37C of the Central Excise Act, 1944.
3. Mr. Khaitan, ably assisted by Ms. Anurupa Banerjee, submitted that the refusal can be treated to be a service only if that refusal has been made by the assessee or by a person authorised to receive documents on behalf of the assessee. Our attention has been drawn to a letter addressed by the Postal authority, which is at page 188, where it was pointed out that service was attempted to be made on one Shankar Sarkar. Ms. Banerjee, however, drew our attention to page 189, namely, an affidavit affirmed by Shankar Sarkar, who affirmed that he was discharged from service of the assessee from 1st February 2001. Our attention was also drawn to an affidavit affirmed by one of the directors, which is at page 167. It is pointed out by Mr. Khaitan that these materials were not considered by the Commissioner of Appeal, wherefrom it appears that the alleged refusal could not have been accepted as service within the meaning of Section 37C.
4. Mr. Roychowdhury, on the other hand, contends that this is a finding of fact and that this cannot form a substantial question of law on the basis of which this Court can exercise its jurisdiction and interfere. He also points out that there was no material to arrive at a conclusive finding that the person Shankar Sarkar was not authorised by the assessee. In the circumstances, it is not a case on which this Court can intervene.
5. It appears that on the question of admission of the appeal and the grant of interim order, both the learned Counsel had addressed the Court on the merit of the case. We, therefore, by consent of the parties, treat the appeal and the application as on the day's list for hearing and dispose of the same as hereunder after admitting the same on the following ground viz. Para 19(e). We admit the appeal on ground (e) under Para 19. Let the appeal be registered. Since the point is very simple and short, we dispose of the appeal as hereinafter.
6. Section 37C prescribes the conditions under which a service can be said to have been made or a service is accepted for the purpose of any proceedings under the 1944 Act. The notice was admittedly sent through post and it has to be served to a person for whom it is intended or to an authorised agent, if any. Now, the question arises as to whether the said Shankar Sarkar could be treated to be as an authorised agent. In order to treat such person as an authorised agent, the onus shifted on the Department to show that he is an authorised agent, particularly when materials were produced before the Commissioner of Appeals and the learned Tribunal to show that he was not in service after 1st February, 2001 and the fact remains that the factory remained closed and stopped functioning, which information was already with the Department. Therefore, a refusal by such a person, who cannot be established to be an authorised agent, would not amount to a refusal by an authorised agent so as to come within the purview of Clause (a) of Section 37C. Thus, we answer the question in favour of the assessee and hold that the refusal, on the basis of which the Commissioner of Appeals had proceeded, could not be treated to be as acceptable service within the scope of Section 37C and the very fact that over phone the assessee was intimated and the assessee had received the adjudication order from the Department itself is indicative of the service on the date when the adjudication order was received by the assessee and as such, the limitation would start running from the date of receipt of the order of adjudication and the appeal having been filed within the period of 60 days, thereafter the appeal is well within time.
7. In the circumstances, the order passed by the Commissioner of Appeals and that by the learned Tribunal are hereby set aside. Let the appeal be decided and disposed of by the Commissioner of Appeals in accordance with law on merit as early as possible. However, unless the Commissioner of Appeals passes appropriate order on an appropriate application of the assessee exempting him from depositing or furnishing security, as the case may be, of the amount due, the assessee shall deposit or furnish such security to the satisfaction of the Commissioner of Appeals in order to maintain the appeal. In case no such application has been made, the assessee shall be at liberty to make such application within a period of a fortnight from date. If such application is made, the Commissioner of Appeals shall decide and dispose of the same in accordance with law without being influenced by any observation made in this order. All points are kept open.
8. This order is passed without prejudice to the rights and contentions of the parties.
9. This direction will not be interpreted to mean that we have directed for putting in the security. The application under Section 35F shall be disposed of on its own merit before the appeal is entertained.
10. All parties concerned are to act on a xerox signed copy of this dictated order on the usual undertaking.