TMI Blog2014 (4) TMI 403X X X X Extracts X X X X X X X X Extracts X X X X ..... recise method and manner of obtaining authorization is not an issue, but only a limited inquiry was permitted to determine whether such authorization was given in accordance with law, which, as discussed, is clearly the case in these proceedings. - Decision in Commissioner of Central Excise v. Ufan Chemicals, [2013 (5) TMI 703 - ALLAHABAD HIGH COURT] followed - Tribunal fell into error in holding that the appeal was not maintainable since the satisfaction as required by Section 86 had not been appropriately recorded. The impugned order is accordingly set aside - Decided in favour of Revenue. - CEAC 20/2014 - - - Dated:- 20-3-2014 - S. Ravindra Bhat And R. V. Easwar,JJ. For the Petitioner : Ms. Sonia Sharma, Sr. Standing Counsel. For the Respondent : Mr. J. K. Mittal with Mr. Vipul Dubey, Advocates. ORDER Mr. Justice S. Ravindra Bhat (Open Court) 1. This is an appeal against an order of the Central Excise and Service Tax Appellate Tribunal ( CESTAT ), which accepted the assessee s objections to an order authorizing the filing of an appeal under Section 86(2) of the Finance Act, 1994 ( the Act ). Section 86 introduced the facility of an appeal to the CES ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 86(2), independent of the merits of the case. 4. The assessee had argued before the CESTAT that the order under Section 86(2) was bad in law because (a) there was no meeting between members of the Committee; (b) the order was prepared by the subordinate officers to which the concerned Chief Commissioners merely appended their signatures without independently considering the matter, or deliberating upon the issue. The CESTAT dismissed the first objection on the strength of the decisions in Commissioner of Central Excise v. ITC Limited, 2008 (221) ELT 331 (Kar.) and Commissioner of Central Excise v. Kundalia Industries, 2012 (279) ELT 351 (Del), holding that there is no statutory requirement of a physical meeting, but only a consensus ad idem on the issue. However, the CESTAT held in favour of the Respondent on the second issue, holding that there was no application of mind. The findings of the CESTAT on this issue were as follows: 14. There is however another aspect. The question is whether the two Chief Commissioners applied their mind and have recorded an informed conclusion / decision for preferring an appeal. As already noticed, the Chief Commissioner, Delhi on 14.07.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b) the appropriateness / desirability of preferring an appeal. 16. In the facts and circumstances of this case, since the Chief Commissioner (DZ) and Chief Commissioner (CZ) merely appended their signatures on 14.07.2012 and 23.07.2012 to the respective note sheets and memorandum of facts and analysis, drawn up by the respective subordinate officers and the record neither records nor discloses due application of mind, the authorisation to prefer the appeal is unsustainable. We note that the Board has issued a memorandum of instructions dated 23.11.2012 pointing out that the notes in the file and other relevant records should disclose meaningful consideration and application of mind by the committee. 17. As a consequence of the unsustainable authorization, the appeal must fail and is accordingly dismissed 5. The appeal before the Court is only with respect to the second issue as to the legality of the satisfaction recorded. The Revenue impugns the finding of the CESTAT and argues that the authorization by the Committee is an administrative act, in which the power of the CESTAT to review is limited. Moreover, it is argued that the administrative act was given shape by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidered on merits by the CESTAT. Whilst there is a requirement for a meaningful procedure to be followed in all administrative acts, including the present one, the Court must view the deliberation by the concerned authority in context. In this case, the respective Superintendents of the two Chief Commissioners prepared detailed notes concerning the facts, law applicable and the need for a reconsideration of the order of the Commissioner. This is not disputed. Equally, it is not disputed that these notes were placed before the Chief Commissioners. The fact that this was done independently for the two Chief Commissioners, who did not sit together, is, as indicated above, not in question and does not affect the legality of the impugned order. The Chief Commissioners endorsed these proposals, and thus, the appeal was filed. The fact that the Chief Commissioners did not, on the record, record independent reasons for concurring with their respective subordinates does not render the authorization void. There is no such requirement in Section 86(2), and this Court does not propose to add another layer to these administrative proceedings. Rather, it is important to view the proceedings as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - is the cause of further disputes. Therefore, given the underlying rationale behind Section 86(2), unless the manner in which the authorization has been granted by the Committee of Chief Commissioners is arbitrary or based on irrelevant information, the Court ought not to interfere with the administrative functioning of the concerned authority, nor impose a new and onerous requirement of an independent detailed and personal consideration by the Chief Commissioners themselves, ignoring the context, i.e. the detailed consideration of the issue by the subordinate officers also involved in the process. The cases relied upon by the Respondent are of no assistance. Neither Kundalia (supra), which concerned authorization under Section 35 of the Central Excise Act, 1944 (requiring the Chief Commissioners to be of the opinion that the order in question is illegal and improper, as opposed to only objecting to the order under Section 86(2)), nor ITC Limited (supra), deal with the standards for review under Section 86(2) or the law as laid down in Berger (supra). In fact, recently in Commissioner of Central Excise v. Ufan Chemicals, 2013 (290) ELT 217 (All), the Allahabad High Court, while c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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