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2015 DIGILAW 1006 (GUJ)

Sigma Diagnostics (I) P. Ltd. v. Union of India

2015-10-08

ABDULLAH GULAMAHMED URAIZEE, HARSHA DEVANI

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JUDGMENT : Harsha Devani, J. 1. Leave to amend the cause-title as well as the prayer clause. 2. Rule. Mr. Gaurang Bhatt, learned senior standing counsel waives service of notice of rule on behalf of the respondents. Having regard to the controversy involved in the petition, with the consent of the learned advocates for the respective parties, the petition is taken up for final hearing today. 3. This petition is directed against the order dated 10.4.2014 passed by the Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as "the Tribunal) in Appeal No. E/2700, 2701/2006-DB whereby the Tribunal has dismissed the appeals for want of prosecution. The petitioners have also challenged the order dated 29.9.2014 passed by the Tribunal on restoration application filed by the petitioners seeking restoration of the appeals which came to be dismissed for default vide the order dated 10.4.2014. 4. Mr. Hasit Dave, learned advocate for the petitioners has submitted that the petitioners had on 10.4.2014 sought an adjournment as the clients had informed the learned advocate that in view of recovery sought to be made by the department they had paid major amount of duty as well as interest. It was submitted that as there were two appeals of this very company before the Tribunal on almost similar facts and one of which had been disposed of on merits by directing confirmation of duty and reduction of penalty of 25% and reduction of penalty on the Director, there was some confusion prevailing at their end. It was submitted that the petitioners have no reason not to seriously prosecute the appeal. It was submitted that under the circumstances, the orders passed by the Tribunal dismissing the appeals are required to be set aside more particularly, in view of the fact that the petitioners do not desire to contest the appeals on merit and only seek to avail of the benefit of option of reduced penalty under section 11AC of the Central Excise Act, 1944 and rule 26 of the Central Excise Rules, 2002 as the case may be, which was not given at the relevant time. It was submitted that in these circumstances, the impugned orders may kindly be quash and set aside and the appeals be restored to the file of the Tribunal for deciding the same on the limited question of grant of option of reduced penalty under section 11AC of the Central Excise Act and rule 26 of the Central Excise Rules, as the case may be. 5. On the other hand, Mr. Gaurang Bhatt, learned senior standing counsel for the respondents opposed the petition, by submitting that there being no infirmity in the impugned orders passed by the Tribunal, there is no warrant for interference by this court. It was further submitted that the payment which is shown to be made in the petition is made in relation to some other demand and does not relate to the matter from which the impugned orders of the Tribunal arise. 6. This court has considered the submissions advanced by the learned counsel for the respective parties and has perused the impugned orders passed by the Tribunal. 7. As can be seen from the impugned orders, the Tribunal has dismissed the appeals on the ground of want of prosecution and has refused to restore the appeals as the Tribunal did not find any merit in the contents of the restoration application. Nonetheless, the learned counsel for the petitioners has invited the attention to the averments made in the memorandum of the petition to submit that there was no reason for the petitioners not to seriously prosecute the appeals. Having regard to the finding recorded by the Tribunal in the impugned order dated 10.4.2014, it cannot be said that the impugned order suffers from any serious legal infirmity. However, considering the fact that the petitioners do not desire to contest the appeals on merits and only seek to avail of the benefit of option of reduced penalty under section 11AC of the Central Excise Act and rule 26 of the Central Excise Rules as the case may be, which, according to the petitioners, was not given to them at the relevant point of time, this court is of the view that it would be in the interests of justice, if the appeals are restored to the file of the Tribunal for deciding the same on the limited question, as aforesaid. 8. 8. For the foregoing reasons, the petition succeeds and is, accordingly, allowed to the following extent : 8.1 The impugned orders dated 10.4.2014 and 29.9.2014 passed by the Tribunal are hereby quashed and set aside. The appeals are restored to the file of the Tribunal for the purpose of considering the limited question as to whether the petitioners are entitled to the benefit of option of reduced penalty under section 11AC of the Central Excise Act and rule 26 of the Central Excise Rules, as the case may be. Rule is made absolute accordingly to the aforesaid extent. 9. Having regard to the fact that the original appeals were filed in the year 2006, the Tribunal is requested to dispose of the appeals as expeditiously as possible and preferably within a period of two months from the date of receipt of a copy of this order.