TMI Blog2015 (11) TMI 1492X X X X Extracts X X X X X X X X Extracts X X X X ..... ating officer' such order is not adjudication order. Incidentally, in Navshakti [2008 (2) TMI 668 - CESTAT, NEW DELHI] the Tribunal was dealing with provisions of Section 110A prior to its amendment with effect from 08/04/2011. The Tribunal, in fact indicated the doubt regarding rank of the final adjudicating officer in that particular case. Order for provisional release restores the seized goods to the owner. The conditions imposed for such restoration is decided by the adjudicating authority. Such decision will certainly have legal consequence to the owner of goods. Revenue asserts that there is no lis at the time of issuing order of release of seized goods. This contention is misconceived. Neither Section 110A nor any other provision of the Act prescribes specific preset conditions or guidelines for exercising such powers. Apparently the adjudicating authority exercises wide ranging discretionary powers, not fretted by any express statutory conditions, pre-listing the types of order that could be issued. When a statute confers powers upon a public official to decide on a person's rights and interests, the principles of natural justice guide the exercise of that power unles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen the appeals were taken up for consideration, Revenue raised a preliminary objection that an appeal against an order under Section 110A does not lie before this Tribunal. It was contended that the issue stands concluded by the Larger Bench decision of the Tribunal in Akanksha Syntax Pvt. Ltd. vs. CC (General), Mumbai - 2013 (289) E.L.T. 186 (Tri. - Mumbai), which ruled that an appeal against an order under Section 110A is not maintainable before the Tribunal under Section 129A of the Customs Act, 1962. After examining the issue in detail, the Division Bench vide the interim order dated 25/05/2015, did not agree with the decision of three member Larger Bench in Akanksha Syntax Pvt. Ltd. (supra). Expressing doubt about the correctness of the decision of Larger Bench, the Division Bench directed the Registry to place the records before the Hon'ble President for consideration and to constitute a Larger Bench to decide the issue. 2. Accordingly, the Hon'ble President, CESTAT, on 05/06/2015 ordered that the issue be referred for consideration by a Special five Member Bench. The issue referred for consideration is: Whether an appeal lies before this Tribunal against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an do is to invite the attention of the Chief Justice and request for the matter being placed for hearing, before a Bench of larger quorum than the Bench whose decision has come up for consideration. It will be open only for a Bench of co-equal strength to express an opinion doubting the correctness of the view taken by the earlier Bench of co-equal strength, whereupon the matter may be placed for hearing before a Bench consisting of a quorum larger than one which pronounced the decision laying down the law the correctness of which is doubted . 8. The Hon'ble Supreme Court also spelt out an exception to the above general rule and observed that the above said rules do not bind the discretion of the Chief Justice in whom vests the power of framing the roster and who can direct any particular matter to be placed for hearing before any particular Bench of any strength. 9. The matter regarding constitution of a Larger Bench by the President was discussed at length in the Tribunal's order in Larsen Toubro Ltd. vs. Commissioner of Service Tax, New Delhi reported in 2014 (36) S.T.R. 1022 (Tri. - Del.). The Tribunal's observations are :- 17. Analyses of the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ublic confidence in the administration of justice. It is, however, equally true that it is vital to the administration of justice that those exercising judicial power must have the necessary freedom to doubt the correctness of an earlier decision if and when subsequent proceedings bring to light what is perceived by them as an erroneous decision in the earlier case. In such circumstances, it is but natural and reasonable and indeed efficacious that the case is referred to a Larger Bench. This is what was done by the Bench of two members who in their reasoned order pointed out what they perceived to be an error of law in the earlier decision and stated the points for the President to make a reference to a Larger Bench. 10. That the President has ample power to refer a case to a Larger Bench is not in doubt in view of sub-section (5) of Section 129C, which we have set out above. That provision clearly says that in the event of the members of a Bench differing in opinion on any point, and the members are equally divided, the case shall be referred to the President for hearing on any such point by one or more of the members of the Tribunal, and such point shall be decided accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on : 6. On a consideration of submissions made by both the sides and the case law relied on by the Departmental representative, we note that the Apex Court judgment in Paras Laminates case has examined both the aspects, viz., (a) the competence of one Bench of the Tribunal to differ from the view taken by another Bench of the Tribunal and (b) the power of the Hon'ble President to constitute and refer a case to a Larger Bench a matter where Members of the Bench differ in opinion on any point and to refer such a case to one or more Members of the Tribunal. It has been observed in Paragraph 11 of the said judgment that Section 129C confers the power of reference upon the Hon'ble President and the power should be construed to be wide enough to enable the Hon'ble President to make a reference where Members of a Bench find themselves unable to decide a case according to what they perceive to be the correct law and fact because of the impediment of an earlier decision with which they cannot honestly agree. The Apex Court had stated: In such cases, it is necessary for the healthy functioning of the Tribunal that the President should have the requisite authority to refer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to the Bench of which he is a member and which pertains to an assessee whose total income as computed by the Assessing Officer in the case does not exceed one lakh rupees and the President may, for the disposal of any particular case, constitute a Special Bench consisting of three or more members, one of whom shall necessarily be a judicial member and one an accountant member. (4) If the members of a Bench differ in opinion on any point, the point shall be decided according to the opinion of the majority, if there is a majority, but if the members are equally divided, they shall state the point or points on which they differ, and the case shall be referred by the President of the Appellate Tribunal for hearing on such point or points by one or more of the other members of the Appellate Tribunal, and such point or points shall be decided according to the opinion of the majority of the members of the Appellate Tribunal who have heard the case, including those who first heard it. (5) Subject to the provisions of this Act, the Appellate Tribunal shall have power to regulate its own procedure and the procedure of Benches thereof in all matters arising out of the exercise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in duplicate along with the observations of the Vice President of the concerned Zone. Note: 2. Document/materials in support of the reasons for constitution of a Special Bench should be enclosed.' The aforesaid regulation shows that the concerned Bench which is seized of the matter may in exercise of its judicial function in appropriate case make a reference to the President to constitute a Special Bench. The exercise of that function by the Bench of the Tribunal hearing the matter is of course a judicial function but so far as the President's power under sub-section (1) read with sub-section (3) of Section 255 to constitute Benches or for that matter Special Benches is concerned the said power is an administrative power. It is obvious that the President in this connection may even act suomotu if it is brought to his notice that any important point is pending for decision in a matter which requires to be decided by a Larger Bench. If the President acting on such information and in bona fide exercise of his powers constitutes a Larger Bench or a Special Bench for deciding a matter it cannot be said that he acts ultra vires his powers or functions entrusted to hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gentleman Suitings Pvt. Ltd. vs. DGRI - 2012 (12) 1001 - TMI - Raj. High Court ; (b) GirirajSpintex Pvt. Ltd. vs. DGRI - 2012 (12) TMI 1002 - Raj. H.C.; (c) Auto Creators vs. Union of India - 2012 (12) TMI 681; (d) Candex Chemical Fibres Co. (P) Ltd. vs. CC, New Delhi - 2014 (310) E.L.T. 500 (Del.); (e) Gurdeep Kaur vs. CC - MANU/DE/3166/2015 15. In Sl. No. a), b) and c) above, Revenue as respondents raised objection against writ petitions on the ground that an order issued under Section 110A is appealable under Section 129A/128. Accordingly the High Courts allowed the petitioners to approach competent appellate forums viz. Commissioner (Appeals) or the Tribunal for relief. In many such similar cases Revenue has taken the consistent stand that a statutory appeal lies before this Tribunal against an order passed by the Commissioner under Section 110A. 16. Appellants contended that there is no decision of any higher courts to the effect that an appeal is not maintainable before the Tribunal in such circumstance. 17. Shri K.K. Anand, Advocate appearing as an intervener submitted that provisions of Section 129A will cover orders issued by the Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court's decision in Jatin Ahuja - 2013 (287) E.L.T. 3 (Del.); (b) a decision/order to release or not to release seized goods provisionally, by the Commissioner as an Adjudicating Authority, is subject to judicial review by courts only but is not subject to a statutory appeal to CESTAT ; (c) simple communication of a decision by an Adjudicating Authority or not granting provisional release on simply intimating the person who has requested for provisional release cannot be a subject matter of an appeal before CESTAT. It is an administrative discretion by the Adjudicating Authority, pending the final order of adjudication. All points of submission by appellants as well as Revenue are being taken up in detail, later in this order. The Statutory provisions : 20. The statutory provisions relevant to the present dispute are: Customs Act, 1962. Section 2 (1) adjudicating authority means any authority competent to pass any order or decision under this Act, but does not include the Board, Commissioner (Appeals) or Appellate Tribunal ; Section 110A : Provisional release of goods, documents and things seized pending adjudication - Any goods, documents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds is an interim order pending an order of the adjudicating authority and therefore the appeal is not maintainable before the Tribunal. The Larger Bench, by majority thus held that an appeal is not maintainable before Tribunal. 23. We find that the majority decision heavily relied on Navshakti Industries Pvt. Ltd. vs. CC, New Delhi - 2008 (225) E.L.T. 522 (Tri. - Del.). In this case the Tribunal had dismissed the appeal in limine. The first reason adduced was that an order of release or non-release cannot be deemed to be an order in the nature of adjudication. The second reason was that the request for release of goods and the consequent order by Commissioner was as per directions of the High Court (in that case) and it was open to the appellant to make a grievance to that effect before the High Court. Hence, only one of the reasons provided to arrive at the finding in Navshakti Industries is a relevant ratio - viz. that a provisional release order cannot be deemed to be an order in the nature of adjudication. No detailed discussion preceded this conclusion. From the drift of the brief analysis in the said order it could be inferred that since an order for provisional release is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisional release restores the seized goods to the owner. The conditions imposed for such restoration is decided by the adjudicating authority. Such decision will certainly have legal consequence to the owner of goods. 29. Revenue's contention is that no statutory appellate remedy is provided against such decision or orders issued under Section 110A. What is relevant to consider is whether such appellate remedy; (i) clearly falls within the ambit of the provisions of Section 129A (1) (a); and/or (ii) is to be inferred within the general scope of the appellate provisions therein and in the absence of any specific bar against any such appeal being preferred. 30. Section 129A (1) (a) provides for any aggrieved person to file an appeal to the Appellate Tribunal against a decision or order passed by the Principal Commissioner of Customs or Commissioner of Customs as an adjudicating authority . It is not disputed that an order under Section 110A can be issued only by an adjudicating authority. Revenue argues that though the order is by an adjudicating authority, it is not an adjudication order. This will take us to who is an adjudicating authority . Section 2 (1) states tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercise of that power unless specifically excluded by the statute itself. To state that a decision or order in exercise of such powers is of unilateral, administrative nature is not legally tenable. The distinction sought to be made that the adjudicating authority acts in circumstances like this which affects the rights of the owner of goods, as not an adjudicating authority, is artificial and fallacious. Hon'ble Supreme Court in Raj Kumar vs. CIT - (2007) 2 SCC 181 held that when civil consequences ensue, there is hardly any distinction between an administrative order and a quasi-judicial order. The Hon'ble Apex Court observed that there might have been difference of opinions at one point of time, but it is now well settled that the thin line between an administrative and a quasi-judicial order now stands obliterated. 33. Revenue relied on Hon'ble Kerala High Court's order in Proprietor, Carmel Exports Imports - 2012 (276) E.L.T. 506 (Ker.). The High Court was dealing with an owner's right to get the seized goods released. The Court held that it is a discretion to be exercised in accordance with well settled principles of law governing the exercise of a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertainly have legal adverse consequences to the owner of the goods. Hence, the owner has to have a remedy which is statutorily provided under Section 129A. 37. Revenue further contended that the appealability of an order for provisional release of goods will impede timely and proper completion of investigation. The time available for completion of investigation and issue of show cause notice as per Section 110 (2) is 6 months, extendable by another six months only. It was contended that appeal against such interim order will have adverse impact on due investigation. This argument apart from being ex-facie without foundation reveals a desperation for restrictive interpretation of the meaning of indeterminate expressions or generally worded legislation. However, rule of law demands that legislative text should be given its full and appropriate meaning and force. Possible administrative inconvenience cannot provide valid jurisdiction for not following certain procedures and to eclipse the remedy mandated by legislation. Scope of Section 129A : 38. Any person aggrieved by an order or decision by the Principal Commissioner of Customs or Commissioner of Customs as an adjudicatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the order passed by the Commissioner of Customs under Section 110A is appealable under Section 129A. 44. During the course of arguments, Counsel for the appellant and intervening Counsel cited other precedents and submitted that there is no order of any higher court to hold that the order issued under Section 110A is not appealable in terms of Section 129A. 45. The case laws relied on by Revenue have no direct bearing on the scope of Section 129A covering orders under Section 110A. 46. Having carefully considered the legal provisions, submissions made by appellants and Revenue we hold :- (a) the contention that an order or decision by the Adjudicating Authority under Section 110A is administrative or interim in nature is misconceived. (b) provisions of Section 129A (1) (a) clearly authorize an appeal against an order or decision by the Adjudicating Authority issued under Section 110A. There is no legal basis to restrict the scope of such appeal in the absence of any restrictive conditions in the provision. 47. In view of our above findings the reference is answered as follows : An appeal lies before this Tribunal against an order passed by Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X
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