APPEAL TO HIGH COURT - INDIRECT TAX MATTERS

[Mr. M. GOVINDARAJAN]

As per Section 35G of the Central Excise Act, 1944 an appeal shall lie to High Court on every order passed in appeal by the Appellate Tribunal. The Commissioner of Central Excise or the other party aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this section shall be –

• filed within one hundred and eighty days from the date on which the order appealed against is received by the Commissioner of Central Excise or the other party;
• accompanied by a fee of two hundred rupees where such appeal is filed by the assessee;
• in the form of a memorandum of appeal precisely stating therein the substantial question of law involved.
  

The High Court may admit an appeal after the expiry of the period of one hundred and eighty days, if it is satisfied that there was sufficient cause for not filing the same within that period. Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. The appeal shall be heard only on the question so formulated, and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question.

Nothing in this section shall be deemed to take away abridge the power of Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, it is satisfied that the case involves such question. The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which decision is founded and may award such cost as it deems fit.

The High Court may determine any issue which -

(a) has not been determined by the Appellate Tribunal, or

(b) has been wrongly determined by the Appellate Tribunal, by reason of a decision of such question of law.

When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two judges of the High Court, and shall be decided in accordance with the opinion of such judges or of the majority, if any, of such judges. Where there is no such majority, the judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other judges of High Court and such point shall be decided according to the opinion of the majority of the judges who have heard the cases including those who first heard it. Save as otherwise provided in this Act, the provisions of code of Civil Procedure 1908, relating to the appeals of High Court shall as far as may be applied in cases of appeals under this section.

When any appeal has been filed before the High Court under Section 35G, it shall be heard by a Bench of not less than two judges of the High Court and shall be decided in accordance with the opinion of such judges or of the majority, if any, of such judges.   Where there is no such majority, the judges shall state the point of law upon which they differ and the case shall then be heard upon that point only by one or more of the other judges of the High Court, and such point shall be decided according to the opinion of the majority of the judges who have heard the case including those who first heard it.

Section 130 of the Customs Act also provides for appeal before the High Court on the same lines as that of Section 35G of the Central Excise Act, 1944.

The opening of Section 35G of the Act, which reads that ‘An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal’ clearly manifest that there is no distinction between the order passed finally or interim order.   In ‘Indoworth India Limited V. CESTAT, Mumbai’ – 2010 (3) TMI 411 - BOMBAY HIGH COURT it was observed that the order of deposit is an order made in appeal.

The High Court is not a court of fact finding which can examine or reconsider factual findings recorded by Tribunal.  However it can examine reasoning given in impugned order to consider it whether it is perverse i.e., an order passed excluding/ignoring admissible/relevant material, takes into account consideration extraneous material and proceeds on assumptions.  The High Court can exercise jurisdiction to examine existence of circumstances which is condition fundamental for making an opinion.

Territorial jurisdiction

In ‘Commissioner of Central Excise V. Radha Madhav Co. Limited’ – 2013 (6) TMI 436 - GUJARAT HIGH COURT the High Court dismissed the appeal of Revenue since the assessee is located in the Union territory of Daman. Section 36(b) of the Central Excise Act, 1944 defines the term ‘High Court’ in relation to the Union Territories of Dadra and Nagar Haveli and Goa, Daman and Diu to mean the High Court of Bombay.

Maintainability

In ‘Commissioner of Customs (SEA), Chennai V. C.P. Aqua Culture (India) Private Limited’ – 2012 (4) TMI 185 - MADRAS HIGH COURT it was held that the appeal to High Court against the order of Tribunal is not maintainable after amendment of Section 130 of the Customs Act, 1962, has been ousted by the National Tribunal Act, 2005 from 28.12.2005, the High Court is not free and has no power to entertain an appeal against the order of Tribunal, even though the said Notification has not yet been issued by the Government to set up the National Tax Tribunal.

Substantial question of law

In ‘Rail track Concrete Production (P) Limited V. Commissioner of Customs and Central Excise, Guwahati’ – 2013 (4) TMI 26 - GAUHATI HIGH COURT the High Court held that from the facts of the case it is evident that there is concurrent finding of fact by all the three authorities below that the appellant had commenced commercial production in January 2007 and therefore was outside the purview of the notification dated 25.4.2007.   There is a clear finding of fact that the appellant had manufactured 4900 numbers of railway sleepers in the month of January 2007 and sold those to the railways which is reflected in the excise returns. The High Court did not find that there is any error or perversity in the above finding of fact recorded by the adjudicating authority which has been affirmed by the first appellate authority as well as by the Tribunal.   The High Court is of the view that no substantial question of law arises out of the impugned decision of the Tribunal.

In ‘Anchor Logistics V. Commissioner of Customs’ 2013 (6) TMI 589 - GUJARAT HIGH COURT the question to be decided is whether the supplier of inputs was non existent firms. The High Court held that this has to be determined on the basis of materials, in that regard the Tribunal as final fact finding authority on application of relevant facts and material having arrived at a factual finding, high court could not interfere with them.  There is no substantial question of law found to arise for consideration of High Court.

Judicial Review

In ‘SKS Ispat & Power Limited V. Commissioner of Customs & Excise’ – 2012 (11) TMI 962 - CHATTISGARH HIGH COURT it was held that Section 35G of the Act provides for an appeal against any order passed by the Appellate Tribunal.   Thus the litigant cannot be permitted to seek redressal of grievances by invoking the forum of judicial review under the writ jurisdiction on the ground that there may not be any question of law as required under Section 35G of the Act.