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2012 DIGILAW 1549 (JHR)

Tinplate Company of India Ltd. Jamshedpur v. Union of India

2012-10-12

APARESH KUMAR SINGH, PRAKASH TATIA

body2012
Judgment Prakash Tatia, CJ. The issue involved in this writ petition is whether before passing any order under Section 85 of the Finance Act, 1994 read with Section 35F of the Central Excise Act, 1944 opportunity of hearing is required to be given to the petitioner, seeking waiver of condition of the predeposit. 2. The petitioner has challenged the order dated 15th March, 2012 (Annexure4) passed by the Commissioner (Appeals) Central Excise & Service Tax, Ranchi, whereby the learned Commissioner (Appeals) without affording any opportunity of hearing to the writ petitioner has decided the petitioner's prayer for waiver of deposit of the duty and interest demanded and penalty imposed and for stay of the operation of the impugned order passed by the Additional Commissioner of Central Excise, Jamshedpur. The learned Commissioner (Appeals) CEST, Ranchi was of the view that in view of the judgment of the Supreme Court delivered in the case of Union of India Vs M/s Jesus Sales Corporation Ltd.[ 1996(83) E.L.T 486 (SC) ], opportunity of haring is not required before deciding the prayer for waiver of predeposit condition provided under the proviso to Section 35 of the Central Excise Act , 1944 and for passing the interim order of stay. 3. Learned counsel for the petitioner submitted that same authority was given direction by this Court in W.P.(T) No.441 of 2012 ( M/s Panch Sheel Udyog Vs Union of India and ors.) decided on 3rd February, 2012 to afford opportunity of hearing to the writ petitioner of that case and consider the prayer of the said writ petitioner for waiver of condition of predeposit of the duty, interest and penalty and for stay. Inspite of having said decision of Division Bench of this Court before the said authority, the authority passed the order impugned dated 15th March, 2012 in gross disregard to the order passed by Division Bench of this Court. Learned counsel further submitted that subsequent to the order passed in M/s Panch Sheel Udyog, the Division Bench of this Court again on 23rd March, 2012 in W.P.(T) No.1502 of 2012 issued same direction to the same authority. The learned counsel for the petitioner further submitted that the case of M/s Jesus Sales Corporation Ltd. has been considered by a Full Bench of the Delhi High Court in the case of J.T.(India) Exports Vs. The learned counsel for the petitioner further submitted that the case of M/s Jesus Sales Corporation Ltd. has been considered by a Full Bench of the Delhi High Court in the case of J.T.(India) Exports Vs. Union of India [2002 (144) ELT 288 (Del.)] along with several other judgments and traced out the history of the principle of natural justice, starting from the case of Ray Vs. Local Government Board(1914) 1KB 160 to several cases of Supreme Court, and it has been held that even if a statute is silent, with no positive words in the Act or Rules spelling out need to hear the party whose rights or interests are likely to be affected, requirement to follow fair procedure before taking a decision must be read into statute, unless statute provides otherwise. By a process of judicial interpretation, two rules have been evolved as representing the principles of natural justice in judicial process, including quasi judicial and administrative process. First, “no man shall be a judge in his own cause” and second, “hear the other side”. Not only this, the Full Bench of Delhi High Court held that natural justice is another name of the common sense justice. The Calcutta High Court in the case of Eveready Industries India Ltd. Vs. Union of India [2010(257) E.L.T. 71(Cal.)] even after considering the Circular of C.B.E. & C dated 30th March, 1999 stipulating that in case of predeposit, authority should pass a reasoned order in an objective manner considering facts even if no hearing granted, held that whenever an order having civil consequences passed, principles of natural justice be complied with and matter was remanded to the authority concerned i.e., the Commissioner of Central Excise (Appeal), Kolkata . The Eveready Industries case also considered the case of M/s Jesus Sales Corporation Ltd. The Division Bench of Rajasthan High Court in the case of Autolite (India)Ltd. Vs. The Eveready Industries case also considered the case of M/s Jesus Sales Corporation Ltd. The Division Bench of Rajasthan High Court in the case of Autolite (India)Ltd. Vs. Union of India [2003(153) E.L.T. 46(Raj.)] also considered the case of M/s Jesus Sales Corporation Ltd., in the matter arising out of the same issue under Section 35F of the Central Excise Act, 1944 and held that when the authority does not act in consonance with the principles of natural justice, the course adopted by this Court is to quash the order and send the matter back for reconsideration as per principles laid down by the courts and in that case following earlier decision the High Court itself ordered that requirement of predeposit of the duty demanded and the penalty imposed against the appellant shall not be imposed for a period of three months within which the Commissioner(Appeals) was directed to decide the appeal itself. The Calcutta High Court again considered the same issue under Section 35F of the Central Excise Act, 1944 and after considering the case of M/s Jesus Sales Corporation Ltd. held that in the interest of fair play and natural justice, petitioner ought to have been given an opportunity of hearing. 4. Learned counsel for the petitioner further submitted that there is gross indiscipline and judicial impropriety on the part of the Commissioner (Appeals), who even after decision of this Court in M/s Panch Sheel Udyog has passed the ex parte order in the present case. 5. We are of the considered opinion that one is not wise who claims that he is wise. One is wise who makes efforts to become more wise. 5. We are of the considered opinion that one is not wise who claims that he is wise. One is wise who makes efforts to become more wise. We are constrained to observe as above because of the reason that if Commissioner(Appeals) Central Excise & Service Tax, Ranchi was of the view that he correctly understood the judgment of M/s Jesus Sales Corporation Ltd. and decided the matter without affording opportunity of hearing to the writ petitioner then, it was the heavy duty upon him to update himself with the laws as the said authority himself took the task of deciding the matter without the assistance of the applicant before him and, therefore, the law laid down by the Hon'ble Supreme Court and which has already been interpreted by the various High Courts should not have been ignored, if he updated his knowledge by reading the judgments referred above wherein case of M/s Jesus Sales Corporation Ltd. has been considered and it has been held that M/s Jesus Sales Corporation Ltd. case has not barred hearing of applicant seeking relief of waiver of condition of predeposit, and if the Commissioner(Appeals) C.E.S.T, Ranchi had no knowledge of those judgments then he is certainly guilty of not keeping himself updated in case where, according to him, he has been given power to decide application having civil consequences, without following principles of natural justice and finding out one old judgment i.e., the judgment delivered in the case of M/s Jesus Sales Corporation Ltd. which he interpreted in the manner in which he wanted to interpret. The interpretation given by the Commissioner (Appeals) Central Excise & Service Tax, Ranchi was certainly erroneous, in view of the reasons given in the aforesaid judgments, wherein the reasons have been given in detail to show that the case of M/s Jesus Sales Corporation Ltd. never laid down that opportunity of hearing is not required before passing any order under Section 35F of the Central Excise Act, 1944 and that position has been fully explained by various High Courts. There was clear direction of this Court in the case of M/s Panch Sheel Udyog to the same authority to grant opportunity of hearing to the writ petitioner of M/s Panch Sheel Udyog in the similar and identical facts and circumstances, yet Commissioner (Appeals) Central Excise & Service Tax, Ranchi without giving any reference to the decision of this Court in M/s Panch Sheel Udyog passed the impugned order, which may amounts to gross contempt of this Court. However, looking to the poor knowledge of the Officer, we are of the considered opinion that the issue need not be stretched too far. 6. At this juncture, it would be relevant to mention here that the same Commissioner in the case of M/s Panch Sheel Udyog (supra) passed order under Section 35F of the Central Excise Act, 1944 on 19th December, 2011 without affording any opportunity of hearing to M/s Panch Sheel Udyog exparte partly allowed the prayer of the above petitioner and permitted the petitioner to deposit 50% amount in satisfaction of compliance of condition of predeposit under Section 35F. The said M/s Panch Sheel Udyog challenged the said order by preferring writ petition being W.P.(T) No.441 of 2012, which was allowed by Division Bench of this Court (by us), vide order dated 3rd February, 2012 and the Commissioner (Appeals) was directed to pass fresh order after giving opportunity of hearing to the writ petitioner. In view of the above direction, the Commissioner (Appeals) heard the writ petitionerM/s Panch Sheel Udyog and passed the order on 11th April, 2012 and became wise and rejected the application of the writ petitionerM/s Panch Sheel Udyog submitted for dispensing with from predeposit of the amount for maintaining the appeal. Meaning thereby when order was passed without hearing, it was more favourable to writ petitionerM/s Panch Sheel Udyog and in same matter when said petitioner was heard, harsh order was passed. This fact had been taken note of by us in W.P.(T) No.2659 of 2012 in the order dated 18th May, 2012. Meaning thereby when order was passed without hearing, it was more favourable to writ petitionerM/s Panch Sheel Udyog and in same matter when said petitioner was heard, harsh order was passed. This fact had been taken note of by us in W.P.(T) No.2659 of 2012 in the order dated 18th May, 2012. Such attitude of the Commissioner (Appeals) Central Excise & Service Tax, Ranchi certainly reflects his attitude towards litigant and also if subsequent order of rejection of the prayer for dispensing with from condition of predeposit of the amount for maintaining the appeal is correct then, by not hearing the appeal the Commissioner (Appeals) has caused loss to the revenue, which he could have avoided by giving opportunity of hearing to the appellant and that would have made him to understand the things more properly. If examined from this angle, which we have examined for the purpose of giving an illustration only then, also the order passed by the Commissioner (Appeals) is certainly detrimental to the interest of the revenue. In totality, we are of the view that order under challenge was absolutely illegal and contrary to law. 7. In view of the detailed reasons given in the judgments referred above, it is held that the Commissioner (Appeals) Central Excise & Service Tax, Ranchi has committed gross error of law in denying the opportunity of hearing to the writ petitioner and because of his act, the proceedings have been delayed in the matter of involvement of the revenue of the Government, as claimed by the Government. The matter has since already been delayed , therefore, following the decisions of Rajasthan High Court, delivered in the case of Autolite (India)Ltd.(supra), the impugned order passed by the Commissioner(Appeals) Central Excise & Service Tax, Ranchi dated 15th March, 2012 is set aside and the Commissioner(Appeals) is directed to decide the appeal of the writ petitioner within a period of three months from the date of receipt of a copy of this order and meanwhile requirement of predeposit of duty demanded and penalty levied against the petitioner shall not be enforced for a period of three months. The petitioner may submit a copy of this order to the concerned authority within a period of one week from the date of receipt of the copy. The petitioner may submit a copy of this order to the concerned authority within a period of one week from the date of receipt of the copy. Let a copy of this order be supplied to the counsel for the petitioner as well as the counsel for the respondents. Ordered accordingly.