Customs, Excise and Gold Tribunal - Tamil Nadu
M/S. Pendium Computer Academy vs Commissioner Of Central Excise, ... on 28 June, 2001
Equivalent citations: 2001(137)ELT1020(TRI-CHENNAI)
ORDER
S.L. Peeran, Member (Judicial)
1. The short question that arises for consideration in this appeal is as to whether the demands can be confirmed without issue of show cause notice to the appellants and calling for explanation as to why the demand cannot be confirmed and penalty be imposed in terms of proviso to section 11 A read with various provisions of the Central Excise Rules and Acts.
2. the Counsel had taken a preliminary objection on the last date of hearing that the Revenue had not issued show cause notice in this matter and no demands can be confirmed under the Central Excise Rules without issue of show cause notice. Ld. DR was directed to call for a report from the Commissioner to find out the validity of the statement made by the appellants as well as the Ld Consultant before us. The Additional commissioner has sent a reply vide letter dt. 7.6.2001 admitting that the show cause notice was not given including personal hearing, as the appellants themselves had waived the same.
3. Appearing on behalf of the appellants the V.P. Namasivayam, Ld Consultant submits that this procedure of waiver of show cause notice is not applicable for proceedings under the Central Excise Act and such a procedure is available only in the Customs Act for speedy clearance of imported goods. He contends that this is well settled by large number of judgments including the Apex Court judgment for confirmation of demand as short levy under section 11 a read with rule 9 and 49 of the Central Excise Rules. The appellants are required to put to notice but such a show cause notice has not been issued hence the demands are not sustainable. He also refers to the judgment rendered in the case of Kiran Spinning Mills reported in 1987 (30) ELT 550 (T) which also clearly lays down that the demands cannot be sustained without issue of show cause notice.
4. The Ld. DR submits that the matter can be remanded to the original authority for rectifying the defects. In counter Ld. Consultant submits that similar proceedings have been set aside by the Tribunal as the lacunae of non issue of show cause notice is not curable.
5. We have considered the submissions made by both the sides. From the report submitted by the Additional Commissioner, the submissions made by the Ld. Consultant stands proved, that the department has not issued a show cause notice as required in terms of provision of Section 11 A read with Rules 9 and 49 of CE Rules for short levy of duty. It is now well settled that without issue of show cause notice no demands can be confirmed as has already been held by the Supreme Court in the case of UOI vs. Madhumilan Syntex Pvt. Ltd. as reported in 1988 (35) ELT 349 (SC) and also in the case of CCE vs. Kosan Metal Products Ltd. reported in 1988 (38) ELT 573 (SC). The Tribunal has also followed these judgment in the following cases:
i) Universal Electronics vs. CCE. 1998 (99) ELT 134.
ii) Ekon Chemicals 1998 (98) ELT 46
iii) CCE vs. Alfa Engineers 1998 (100) ELT 157
6. We are of the considered opinion that the issue is now fully settled in terms of the afore noted judgments. In so far as proceedings under the Central Excise Act is concerned that it is basic and fundamental for issue of show cause notice for raising demands for confirmation purpose. If it has not done, then it is fundamental error, which is not curable and such proceedings are not sustainable. The fact that party has waived the show cause notice will not absolve the department's statutory responsibility to issue show cause notice under the relevant provisions of the Central Excise Act. In that view of the settled position of law the appellants succeeded on this preliminary point raised by them itself. Hence the impugned order is set aside and the appeal is allowed with consequently relief, if any.
(order dictated and pronounced in the open court)