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WAGHBAKRIWALA RAYONS Versus UNION OF INDIA

2016 (2) TMI 18 - GUJARAT HIGH COURT

Validity of order directing to make pre-deposit while Remanding back the proceedings - The adjudicating authority proceeded ex-parte and passed the final order confirming the duty demand with penalty and interest. - Tribunal on the ground that twice the proceedings were earlier adjourned, refused to grant any further time and while remanding the proceedings to the adjudicating authority imposed the said condition of depositing sum of ₹ 50 lacs on the petitioners. - Held that:- When the .....

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e notices of hearing of the show cause notice proceedings and hearing was revived after long gap of nearly 9 years. In the meantime, factory of the petitioners was closed down. Primarily on such grounds, we are inclined to set aside the condition imposed by the Tribunal of depositing a sizable sum of ₹ 50 Lacs which is made a precondition for fresh disposal of the show cause notice by the adjudicating authority. - In order not to delay the proceedings further while setting aside the Tr .....

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DVOCATE ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. Petitioners have challenged an order dated 6.2.2014 passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT for short) under which while remanding the proceedings back to the adjudicating authority, Tribunal imposed a condition of depositing sum of ₹ 50 lacs on the petitioners. 2. The petitioners were served with show cause notice dated 14.12.2004 why excise duty with interest and penalty not be recovered. It .....

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equested for remand of the proceedings since the order in original was passed ex-parte. On the date of hearing on 6.2.2014, in fact, the petitioners requested for adjournment. However, the Tribunal on the ground that twice the proceedings were earlier adjourned, refused to grant any further time and while remanding the proceedings to the adjudicating authority imposed the said condition of depositing sum of ₹ 50 lacs on the petitioners. Tribunal made following observations: 4. On perusal o .....

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of appeal that impugned order is issued exparte, without giving a single hearing to the appellant and they were not given time for presenting their case. On perusal of the impugned order, we find that the adjudicating authority has recorded that he had granted personal hearing to the appellant and hearing notices were returned to the office of the adjudicating authority by the postal authority with remarks 'Left/Returned to sender'. We would have normally allowed these applications and .....

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hold that appellants herein were non-cooperative with the adjudicating authority. At the same time, there being a claim of violation of principles of natural justice, in the interest, in our view, the appellants should be granted an opportunity for filing reply to the show cause notice and being heard by the adjudicating authority. 5. In view of the above, there being noncooperation from the appellant even before us, which can be noticed from the fact that notes were filed for adjournments; app .....

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thin four weeks from today, stating their defence before adjudicating authority and also the address for communication. Subject to such compliance of depositing the amount being reported, adjudicating authority shall take up the matters for disposal after following the principles of natural justice. Stay petitions and appeals allowed by way of remand . 3. Counsel for the petitioners drew our attention to the decision of Division Bench of this Court in case of Avaya Global Connect Ltd. V/s. Union .....

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d Anr. 4. Learned counsel, Shri R.J.Oza, for the Department on the other hand pointed out that even after service of the show cause notice, petitioners had not filed any reply. Notices were dispatched to the factory address given by the petitioners. Since 2004, petitioners are facing proceedings for recovery of unpaid excise duties for a sum of ₹ 4 crores (rounded off) with matching penalty and interest. Tribunal under Section 35C of the Central Excise Act has ample powers to impose suitab .....

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r appealed against or refer the case back to the authority which passed such decision or order with such directions as the Appellate Tribunal may think fit, for fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary. The terminology directions in the aforesaid provision cannot be restricted to the directions of the lower authorities to do de novo adjudication proceedings in a particular way and/or giving certain guidance to the adjudicating authority t .....

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by the Appellate Tribunal that before the original adjudicating authority the assessee has not cooperted like in the present case, however, the assessee is to be given additional opportunity, the Tribunal may issue direction directing the appellant assessee to deposit some amount while remanding the matter to the original adjudicating authority and before his case is considered on merits by the original adjudicating authority on remand. The aforesaid direction as such cannot be said to be a orde .....

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assessee and/or because of any error and/or fault on the part of adjudicating authority, the Tribunal may not issue such direction of deposit. However, to say that the Appellate Tribunal lacks total jurisdiction of issuing any such direction of deposit of some amount while remanding the matter to the original adjudicating authority for de novo adjudication under Section 35C of the Act, cannot be accepted . 6. Sub-section (1) of Section 35C of the Central Excise Act provides that the Appellate Tr .....

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t. In the process of directing the authority to re-decide the case, Tribunal may also give directions as found fit. It is, therefore, clear that any order of remand that the Tribunal may pass does not need to be unconditional. It is well within the jurisdiction of the Tribunal to impose suitable conditions as may be found necessary in the facts of the case. Depositing certain amount as a pre-condition to such remand therefore is well within the power of the Tribunal, though the same may not be t .....

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