Custom, Excise & Service Tax Tribunal
M/S Wellman Hindustan Ltd vs Cce, Thane-I on 5 June, 2009
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH, MUMBAI
COURT NO. 1
Excise Appeal Nos. 163 to 165 of 2009-Mum
(Arising out of Order-in-Appeal No. YG/132 to 134/Th-I/08 dated 31.10.2008 passed by the Commissioner of Central Excise (Appeals), Mumbai)
DATE OF HEARING : 05.06.2009
DATE OF DECISION : 05.06.2009
FOR APPROVAL AND SIGNATURE :
HONBLE MR. JUSTICE R.M.S. KHANDEPARKAR, PRESIDENT
HONBLE MR. A.K. SRIVASTAVA, MEMBER (TECHNICAL)
1. Whether Press Reporters may be allowed to see the order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982 ?.
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not ?
3. Whether their Lordships wish to see the fair copy of the Order ?
4. Whether Order is to be circulated to the Departmental Authorities?
M/s Wellman Hindustan Ltd. . Appellants
(Rep by Sh. Z.B. Nagarkar, Conslt.)
VERSUS
CCE, Thane-I . Respondent
(Rep. by Sh. N.A. Sayed, DR)
CORAM : HONBLE MR. JUSTICE RMS KHANDEPARKAR, PRESIDENT
HONBLE MR. A.K. SRIVASTAVA, MEMBER (TECHNICAL)
ORAL ORDER NO.______________________________
PER JUSTICE R.M.S. KHANDEPARKAR :
These appeals are taken up for hearing in terms of the order passed in Stay Application Nos. E/197 to 199/09-Mum.
2. Since common question of law and facts arise in all these appeals, they were heard together and are being disposed of by this common order.
3. The appellants challenged the impugned common order passed in all the three appeals by the Commissioner (Appeals) on 31st October, 2008 being contrary to the materials on record as well as in contravention of the statutory provisions comprised under Section 37-C of the Central Excise Act, 1944.
4. Brief facts relevant for the decision are that : The Deputy Commissioner, Thane, under his orders dated 29th July, 2000 and 2nd August, 2000, held that, the assessable value of the impugned goods declared by the appellants was required to be loaded with indirect costs, such as, interest, depreciation, administrative expenses etc. and the amount was required to be added to the price declared by the party to arrive at the assessable value under the provisions of Central Excise (Valuation) Rules, 1975, and confirmed the differential duty for the period October, 1995 to February, 1996 on the quantity of poly wool yarn and poly viscose yarn cleared for captive consumption in respect of 13 show cause notices issued during the period from December 1995 to October 1999. With reference to the show cause notice dated 03rd April, 1996 and in third one confirmed the demand of duty while denying the exemption claimed for the period during April, 1993 to August, 1993 under Notification No. 280/79 dated 30th October, 1979 and also imposed penalty.
5. Meanwhile, it appears that, under order dated 07.01.1998 passed by the High Court of Bombay in a Notice of Motion taken out in Suit No. 21 of 1998, the Receiver came to be appointed in respect of the appellants company. There were also some labour disputes raised by the appellants company during the year 1998-99. On 4th July, 2006, the appellants addressed a letter to the Deputy Commissioner of Central Excise, Thane, stating as under :
Our unit was engaged in job work of spinning yarn primarily for Raymond and we have to close it down in Nov 1999. There was considerable violence and dispute between the management and the employees. A copy of the letter issued by us to Central Excise Superintendent Division III, Range II, is enclosed for your reference.
After Nov 1999, we from the management were not even able to enter into factory premises. The watchmen and the security staff were also appointed by ICICI who were our financers.
We are now trying to revive the company by arranging it with our financers and BIFR.
We learn that there are certain demands and orders for certain amount of Central Excise Duty. As we are very keen to settle our outstanding issues with Central Excise Department, we request you to furnish us copies of all communications to our address given below. .
6. In response to the said letter, the Assistant Commissioner of Thane informed the appellants about the arrears pending against them under letter dated 19th July, 2006. The same reads as under :
Please refer to your letter dated 04.07.1006 received on 19.07.2006 and as per the personal talk with undersigned, the list of arrears pending against M/s Wellman Hindustan Ltd. is given below :
Amt. In 000/-
S.NO. O-I-O NO. & DATE DUTY PENALTY TOTAL
1. DSN/71/99 dt. 11.01.2000 1383 1383 2766
2. 14/Th-III/WHI/01 dt. 31.07.2000 6626 6626 13252
3. DK/55/00 dt. 31.07.2000 944 0 944
4. DK/56/00 dt. 31.07.2000 117 25 142
5. 277-278/Th-III/PI/00-01 157 100 257
6. 294/Th-III/JPD/06/01 Dt. 27.02.01 1 0 01
7. 35/97-98 dt. 28.11.97 38 2 40
8. 279-280/Th-III/00-01 dt. 22.02.01 434 200 634
9. 34/Th-III/ISS-00 dt. 25.9.01 4 1 5
10. 34/Th-III/ISS-01 828 0 828
11. 547-549/Th-III/R-8/96-97 dt. 01.05.96 200 25 225 TOTAL 19094
7. In furtherance to the said letter, the appellants requested the Department for furnishing of the order passed by the authority against the appellants under their letter which was submitted to the Office of the Assistant Commissioner at Thane on 10th August, 2006. The same reads as under :
We are concerned with our client M/s Wellman Hindustan Ltd. who have urged us to take up their case before the competent authorities for determining the duty liability arising out of Orders issued by your office. A copy of the Vakalatnama in our favour is enclosed.
2. Kindly refer to your letter dated 19.07.2006 showing the list of arrears pending against M/s Wellman Hindustan Ltd. As has already been brought to your notice by the Company, the factory was closed in November, 1999 after which the Management or the staff were not allowed to visit the factory or office which was taken over by the financiers like ICICI and BIFR.
3. Orders-in-Original of the following orders which were not served on our client may kindly be furnished to us so as to enable us to scrutinize them before filing appeal if any before the competent authority.
S.NO. ORDER NO. DATE OF ORDER NAME OF THE AUTHORITY PASSING THE ORDER
1. 277/278/Th-III/JPD/2000-2001 27.02.2000 Sh. J.P. Dhende (Asst. Commissioner (ADJ)
2. V/Adj(SCN)/15-WH/2000248 31.07.2000 Sh. Deepak Kumar (Addl. Commissioner)
3. V/Adj(SCN)/15-WH/2000 31.12.2000 Sh. Deepak Kumar (Addl. Commissioner)
4. V/Adj(SCN)/15-01/99/884 31.07.2000 Sh. D.S. Negi (Addl. Commissioner)
5. F.No. CEX/R.III/WELL/INTERST /99-00/03 10.05.2001 Deputy Commissioner
6. 279-280/Th-III/JPD/2000-2001 22.02.2001 Sh. J.P. Dhende (Asst. Commissioner (ADJ)
7. 14-26/Th-III/WH/2000-01 24.07.2000 Sh. H.H. Khokar, Deputy commissioner
4. The copies of the correspondences fixing Personal Hearing and letter issued by your office which were not served on our client may also be enclosed for the purpose.
8. It is undisputed fact that copy of the order was received by the appellants on 19th July, 2006. However, the certified copy thereof, which was asked for on 10th August, 2006, was not delivered to the appellants. The appellants thereupon on 7th September, 2006 filed appeals before the Commissioner (Appeals) and the same came to be dismissed by the impugned order.
9. The Commissioner (Appeals) in the impugned order has held that, the appeals were filed after more than six years from the date of actual receipt of the impugned order-in-original by the appellants. The said finding has been arrived at on the basis of the letter dated 11th June, 2007, stated to have been received by the Commissioner (Appeals) from the Assistant Commissioner of Central Excise, Thane. It has been recorded in the impugned order that, the Assistant Commissioner of Central Excise had stated in the said letter that the original orders were served upon the appellants on 2nd August, 2000 and 16th September, 2000 and in support thereof he had enclosed photocopies of opening page of the impugned order showing the date and signatures of the persons who had received the impugned orders.
10. While assailing the impugned order, the learned advocate appearing for the appellants, submitted that, the endorsements which are stated to have been recorded on the copy of the impugned orders in possession of the Department were neither of any of the employees of the appellants company nor on behalf of the appellants company. The signatures do not disclose to have been affixed on behalf of the appellants and, in any case, according to the learned advocate, in the absence of proper records of the service of the copy of the orders upon the appellants, the Commissioner (Appeals) could not have held that the appeal was filed after more than six years of actual date of receipt of the order. Attention was also drawn to Section 37-C of the said Act in this regard.
11. The learned DR, on the other hand, submitted that, the Commissioner (Appeals) having considered the fact regarding service of the copy of the orders upon the appellants and on the basis thereof having held that the appeal was filed beyond the period of six years, there is no case for interference in the impugned order.
12. As already stated above, the order of the Commissioner (Appeals) in relation to the finding about the service of the order-in-original upon the appellants on 02nd August, 2000 and 16th September, 2000 is based on the letter dated 11th June, 2007. It has been stated on behalf o the appellants that not even a copy of the said order was made available to the appellants at any time. Besides, the appellants had also filed an affidavit asserting that they had not received the copy of the order prior to 09th July, 2006.
13. The fact of service of copy of the order by the Department in relation to the order passed under the said Act is to be established in accordance with the provisions of law comprised under Section 37-C of the said Act. The said Section 37-C(1) provides that, any decision or order passed or any summons or notices issued under this Act or the Rules made thereunder, shall be served, - (a) by tendering the decision, order, summons or notice, or sending it by registered post with acknowledgement due, to the person for whom it is intended or his authorized agent, if any; (b) if the decision, order, summons or notice cannot be served in the manner provided in clause (a), by affixing a copy thereof to some conspicuous part of the factory or warehouse or other place of business or usual place of residence of the person for whom such decision, order, summons or notice, as the case may be, is intended; (c) if the decision, order, summons or notice cannot be served in the manner provided in clauses (a) and (b), by affixing a copy thereof on the notice board of the officer or authority who or which passed such decision or order or issued such summons or notice. Sub-section (2) of Section 37-C provides that, every decision or order passed or any summons or notice issued under this Act or the Rules made thereunder, shall be deemed to have been served on the date on which the decision, order, summons or notice is tendered or delivered by post or a copy thereof is affixed in the manner provided in sub-section (1) of Section 37-C.
14. In other words, Section 37-C not only makes a complete provision in relation to the service of notice or order issued under the said order, but also in relation to the occasion when the presumption regarding the service of notice or order would arise. Sub-section (1) deals with the procedure for service of notice or order issued under the Act. Sub-section (2) specifies the date on which such service would be deemed to have been made.
15. In the case in hand, we are actually concerned with the first mode of service prescribed under Section 37-C, as it is nobodys case that the copy of the order could not be served by rendering or by sending registered post. In the case in hand, it is the contention of the Department that the copy of the order was served by tendering the same to the appellants. It is a matter of record that the appellants is a Public Limited Company. Obviously, therefore, the service has to be made to a person who can represent the company. Undoubtedly, one of the copies of the order, which is placed on record, discloses endorsement by someone of having received the copy of the order. However, the said endorsement nowhere discloses the copy having been received by the company. Hence, on the endorsed copy neither there is seal of the company nor there is any endorsement by the person having received the copy on behalf of the company. The records nowhere disclose that the person whose endorsement was received was in the employment of the appellants company.
16. In fact, whenever a copy of the order or notice is served upon the addressee and if the addressee happens to be a company, the person serving the copy should insist for seal of the company and disclosure of identity of the person receiving the same on behalf of the company and to require such person to make necessary endorsement about his identify along with the signature on the copy of the order to be retained by the Department. Admittedly, no such efforts were made by the Department in the case in hand. Even otherwise, there is no other document produced by the Department to disclose service of the order upon the appellants.
17. It is true that the impugned order refers to the letter dated 11th June, 2007 by the Assistant Commissioner in that regard. However, as it is disclosed from the order itself, that the letter merely states that the copy of the order was served upon the appellants on 2nd August, 2000 and 16th September, 2000, and in support of his claim the Assistant Commissioner had forwarded photocopies of the first page of the impugned order on which the alleged endorsement in respect of the signatures of the persons having received the copy were found. It is not in dispute that the letter nowhere stated that the signatures, which were found on the copies, were of the persons employed in the appellants company or that the persons who had signed and received the copies had done so on behalf of the company. Indeed, the Assistant Commissioner could not have stated so because the endorsement neither discloses the same nor it is the case of the respondent that the author of the letter dated 11th June, 2007 had himself served the copy of the order upon the appellants. He had no personal knowledge about the actual service of the copy of the order upon the appellants. The records on the face of it did not disclose anything more than signatures of some person on the copies of the orders. Thus, under these circumstances, we fail to understand how the Commissioner (Appeals) could have by merely relying upon the said letter dated 11th June, 2007 arrived at a finding about the service of the copy of the order upon the appellants. In our considered opinion, there was no cogent material available before the Commissioner (Appeals) to hold that the copies of the orders were really served upon the appellants on 2nd August, 2000 and 16th September, 2000. As against this, there is solemn affirmation on behalf of the appellants that they got the copies for the first time on 19th July, 2006. The said assertion was also corroborated by the preceding correspondence between the appellants and the Department. In these circumstances, in our considered opinion, there was no room to doubt about the fact that the copies of the orders were, in fact, received by the appellants for the first time on 19th July, 2006.
18. Once it is clear from the records that the copies were received for the first time on 19th July, 2006 and the appeals were filed on 7th September, 2006, they were filed within the period of limitation and, therefore, it was necessary for the Commissioner (Appeals) to deal with the appeals on merits.
19. For the reasons stated above, the impugned order, therefore, cannot be sustained and is liable to be set aside. Accordingly, the matter is remanded to the Commissioner (Appeals) to deal with the appeals on merits. The appeals stand disposed of in the above terms.
(JUSTICE R.M.S. KHANDEPARKAR) PRESIDENT (A.K. SRIVASTAVA) MEMBER (TECHNICAL) Golay