Customs, Excise and Gold Tribunal - Delhi
M/S. Puneet Steels & Alloys vs Cce, Jaipur on 16 January, 2001
ORDER
P.G. Chacko :
1. On careful examination of the records of this case and on hearing both sides, I find that this is a fit case for remand and accordingly, after allowing the present application unconditionally, I proceed to dispose of the appeal itself finally.
2. The appellants, who were engaged in the manufacture of M.S. Ingots falling under Chapter Sub-Heading 7206.90 and were covered by the provisions of Rule 96ZO of the Central Excise Rules read with Section 3A of the Central Excise Act, filed an abatement claim with the jurisdictional Commissioner of Central Excise for certain period. This claim was rejected by the Commissioner without personal hearing. The party, therefore, preferred appeal to this Tribunal. The Tribunal by order dated 24.11.99 set aside the Commissioner's order and remanded the matter to that authority for fresh disposal in accordance with the principles of natural justice. While the abatement claim was originally pending before the Commissioner, show-cause notice dated 4.9.98 had been issued to the party by the jurisdictional Assistant Commissioner alleging that an amount of Rs.32,70,690/- was yet to be paid by them for the period September, 1997 to March, 1998 on the basis of their annual capacity of production (ACP) determined under Rule 96ZO. The show-cause notice proposed to recover the said amount under Section 11A of the Central Excise Act and to impose penalty on the party under Rule 209 of the Central Excise Rules. The appellants, in their reply to the show-cause notice, requested for dropping the proceedings. They submitted, inter alia, that the factory had remained closed for most of the time and, therefore, they were not liable to pay the duty demanded. The dispute was adjudicated by the Joint Commissioner as per Order dated 22.7.99, which was passed without any personal hearing. The Joint Commissioner confirmed the demand of duty to the extent of Rs.3,67,464/- against the party for the period 1.9.97 to 31.3.98 and imposed on them a penalty of Rs.1.5 lakhs under Rule 209 of the Central Excise Rules. Aggrieved by the order of the Joint Commissioner, the party preferred appeal to the Commissioner (Appeals). The lower appellate authority upheld the Joint Commissioner's order as per Order dated 4.8.2000. This order also was passed without granting any opportunity of personal hearing to the appellants. The Commissioner (Appeals) dispensed with personal hearing for the reason that the appellants had not asked for the same. Moreover, as regards the appellants' grievance against non-grant of personal hearing by the adjudicating authority, Ld. Commissioner (Appeals) observed that such non-grant of personal hearing did not violate the principles of natural justice. In the present appeal before the Tribunal, the order of the Commissioners (Appeals) is under challenged.
3. I have heard both sides.
4. Ld. Advocate Sh. J.S. Agarwal has reiterated the grounds of this appeal and has prayed for remand of the matter to the lower appellate authority. Ld. JDR Sh. Swatantra Kumar, has made an attempt to justify the orders of the lower authorities. I find that the orders passed by the lower authorities were in violation of the principles of natural justice. As rightly submitted by Ld. Advocate, it was specifically submitted by the appellants in their letter dated 29.5.2000 to the Commissioner (Appeals) that their claim of abatement of duty amounting to Rs.3,67,464/- for the period 1.9.97 to 31.3.98 was still pending before the Commissioner of Central Excise pursuant to the remand Order dated 24.11.99 of the Tribunal. It was also specifically prayed by the appellants that the matter be decided on the basis of the submissions contained in the letter. But on a perusal of the impugned order, it appears that none of the written submissions was considered by Ld. Commissioner (Appeals). though the duty demand involved in the appellant's case was precisely the amount covered by the abatement claim, the Commissioner (Appeals) did not wait for the results of settlement of the said claim by the Commissioner, before proceeding to uphold the Joint Commissioner's order confirming the said demand of duty. The lower appellate authority also overlooked the fact that the Joint Commissioner had imposed a penalty under Rule 209 of the Central Excise Rules without recording any finding that any of the conditions laid down under the Rule for imposition of such penalty existed in the assessees' case. This reveals gross non-application of mind on the part of the Commissioner (Appeals). However, I cannot find fault with the Commissioner (Appeals) for his having dispensed with personal hearing. This is because, by letter dated 29.5.2000, the party had virtually waived such hearing. This however, will not absolve the lower appellate authority of the serious omission of not having interferred with the Joint Commissioner's action of adjudicating the dispute without granting personal hearing. I, therefore, hold that the order of the Commissioner (Appeals) upholding the adjudicating authority's order passed in violation of natural justice is bad in law and is liable to be set aside. Accordingly, I set aside the impugned order as well as the order of the Joint Commissioner and allow this appeal by way of remand, directing the Adjudicating Authority to adjudicate the dispute afresh in accordance with law as well as the principles of natural justice, after giving a reasonable opportunity of hearing to the party and duly considering the final outcome of the assessees' the abatement claim under reference.