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2015 (12) TMI 235 - ALLAHABAD HIGH COURT

2015 (12) TMI 235 - ALLAHABAD HIGH COURT - 2015 (326) E.L.T. 644 (All.) - Ex-parte order without service of any notice - Clandestine removal of final product from two different units Joint liability - Violation of principle of natural justice - Held that:- Commissioner in her affidavit has admitted that the impugned order was passed without service of any notice thereby meaning no opportunity of hearing was granted to the petitioner. The tribunal directed the Commisioner to provide opportunity .....

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use notice issued by the department and denovo proceedings has to be started, if any, by the department itself. Issuance of a fresh notice not only flows from Article 14 of the Constitution but also from the provisions of the Central Excise Act. In our opinion the stand adopted by the Commissioner is nothing else but an after thought in trying to justify her action in passing an ex parte order. - Impugned order is set aside - Decided in favour of assessee. - Writ Tax No. - 771 of 2015 - Dated:- .....

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he present writ petition has been filed for the quashing of the order in original dated 28.08.2015 passed by the Commissioner, Customs, Central Excise & Service Tax, 117/7, Sarvodaya Nagar, Kanpur. Normally the Court does not entertain the petition where an altenative remedy is available. A preliminary objection was raised at the time when the writ petition was filed but considering the facts and circumstances of the case, the Court entertained the writ petition and, by an order dated 29.9.2 .....

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the Customs, Excise and Service Tax Appellate Tribunal, which was allowed and the order in original dated 31.03.2011 was set aside. The Tribunal vide its order 25.2.2013 remitted the matter again to the Commissioner to pass a fresh order. The operative portion of the Tribunal's order dated 25.2.2013 is extracted herein under: "6. As we have already observed that there are various decisions laying down that a joint demand and joint penalty cannot be confirmed against the appellants agai .....

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al, while remitting the matter, permitted the assessee to raise all the legal issues including the appreciation of evidence on record, including the appellant's request for cross-examination. Pursuant to the order of the Tribunal, no further proceedings were initiated by the Commissioner and an exparte order dated 28.8.2015 was passed by the Commissioner imposing fresh duties and penalties. The petitioner filed the present writ petition contending that the order in original was passed ex par .....

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n is not a part of natural justice but only a procedure and therefore cross examination of a witness was not required to be given. Pursuant to our order, the Commissioner appeared and filed an affidavit admitting in paragraph 3 that the impugned order was passed without serving any notice. The officer justified her action by holding that the parties were under an obligation to appear and raise the issue before the adjudicating authority. The Commissioner further contended that it incumbent upon .....

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he import of the order dated 25.02.2013 of the Tribunal, in asmuch as, the order passed by the CESTAT has been in two portions (1) Fresh decision for fixing liability severally; (2) "the assessees are entitled to raise all the legal issues including the appreciation of evidence on record, including the appellants request for cross-examination afresh in the de-novo proceeding." In view of the above the deponent under a patent belief that in so far as the legal issues were concerned the .....

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quot; On the basis of the affidavits filed before the Court, it has come on record that a sanction order dated 3.5.2013 was passed by the Director General to launch criminal proceedings against the petitioners. The learned counsel submitted and tried to impress upon the Court that the said order granting sanction to launch criminal proceedings was based on half truths and incomplete facts which was sent by the Commissioner. It was contended that the appellate order dated 25.02.2013 was not broug .....

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g the order for initiating criminal proceedings agianst the petitioner. It was also urged that even after the sanctioning order dated 3.05.2013 was passed the Additional Commissioner, Jhansi who was the nominated authority to file the complaint, wrote a letter dated 17.10.2013 to the Additional Commissioner (Legal) asking for necessary direction to file the complaint in the back drop of the appellate order setting aside the order in original. The Additional Commissioner on the basis of an approv .....

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cation, the impugned order in original dated 28.8.2015 was filed in the court concerned without even serving the same upon the petitioner. It was urged that this was done deliberately in order to scuttle the proceedings before the Criminal Court. On this basis, the leaned counsel contends that the speed and the manner in which the Commissioner moved to save the prosecution proceedings by passing the impugned order speaks volumes by itself coupled with the fact that the said order was an ex parte .....

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harass the petitioner for vested reasons. It was further urged that the conduct of the Commissioner shows that the petitioner will not get justice from the Commissioner and, consequently, submitted that while setting aside the ex parte order a direction should be issued for transfer of the case to another competent officer. On this aspect, Shri Ashok Mehta, the learned Senior Counsel conceded that the department has no objection if the matter is transferred to another competent officer. Without .....

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tunity of hearing was granted to the petitioner. The tribunal directed the Commisioner to provide opportunity of cross examination of the witnesses, which has been denied by the Commissioner in paragraph no.107 of the impugned order. The justification given by the officer in paragraph no.3 of her affidavit is that the petitioners were under an obligation to appear before the authority concerned pursuant to the order of the tribunal and that it was incumbent upon the petitioner to approach the ad .....

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ovisions of the Central Excise Act. In our opinion the stand adopted by the Commissioner is nothing else but an after thought in trying to justify her action in passing an ex parte order. The Supreme Court in Ayaaubkhand Noorkhan Pathan Vs. State of Maharashtra and others, 2013(4) SCC 465 held: "24. A Constitution Bench of this Court in State of M.P. Vs. Chintaman Sadashiva Waishampayan held that the rules of natural justice require that a party must be given the opportunity to adduce all r .....

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0: AIR 2008 SC 876, Rachpal Singh Vs. Gurmit Kaur, 2009 (15) SCC88: (2009)5 SCC(Civ)549: AIR 2009 SC 142, Biecco Lawrie Ltd. v. State of W.B., 2009 (10) SCC 32: (2009)2 SCC(L&S)729: AIR 2010 SC 142, and State of U.P. V. Saroj Kumar Sinha, 2010 (2) SCC772: (2010)1 SCC(L & S) 675: AIR 2010 SC 3131. 25. In Lakshman Exports Ltd. V. CCE, (2005)10 SCC 634, this Court, while dealing with a case under the Central Excise Act, 1944, considered a similar issue i.e.permission with respect to the cro .....

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