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2016 (4) TMI 796 - ORISSA HIGH COURT

2016 (4) TMI 796 - ORISSA HIGH COURT - 2016 (338) E.L.T. 498 (Ori.) - Compliance of sub-section (2) of Section 35B of the Central Excise Act, 1944 - Held that:- The word “may”, appearing in sub-section (2) of section 35B of the Act should not be misconceived as submitted by learned counsel for the appellant. The proviso to sub-section (2) of section 35B of the Act also postulates that in the case of difference of opinion between the Commissioner of Central Excise, they will make reference to the .....

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ection (2) of Section 35B of the Act to prefer appeal. It is needless to say that application of judicial mind to the facts and law of the case by the concerned Committee of Commissioners of Central Excise is a condition precedent for filing appeal. Any non-application of mind in rendering opinion to file appeal may cause serious impact on the public exchequer or on the economic growth of the country. Since the authorization would be to one of the Central Excise Officers, the word “may” as appea .....

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- Adverting to the facts of the case and points of law as discussed by us, we are of the view that the authorisation made in Annexure-3 of the affidavit filed by the appellant to prefer appeal without same being filed along with appeal is surely an incurable defect and the same cannot be rectified by filing an authorization letter as stated by the learned counsel for the appellant. Similarly as the authorization by the Committee of Commissioners of Central Excise is not found in the impugne .....

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tioned writ appeal is preferred challenging the order dated 25.4.2012 passed by learned Customs, Excise & Service Tax Appellate Tribunal(hereinafter called CESTAT), Eastern Zonal Bench, Kolkata in Excise Appeal No. 674 of 2006 in dismissing the appeal being infructuous. Facts of the case : 2. The factual matrix of the case of the appellant is that respondent-assessee is manufacturer of paper and board products, classified under Chapter No.48 of Central Excise Tariff Act, 1985. The officers o .....

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ome deficiencies detected by the officers of the appellant. It was noticed by the officers of the appellant that sludge had been removed without reversing of his price in scrap arising out of MODVATABLE capital goods without payment of central excise duty. They found 62.314 metric tons of paper in excess without having been accounted for in its RG -1 and the same was seized. Show-cause notice dated 15.4.2008 was issued to the appellant and its Manager(Commercial) and Executive (Central Excise) a .....

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n the MODVAT inputs unutilized in the manufacture of finished goods; and VI. an amount ₹ 4,740/- reversible on the clearance of exempted goods which are not paid by the party at the time of clearance of these goods but paid by them later, should not be confirmed under section (1) of section 11A of the Central Excise Act, 1944 (hereinafter called the Act ) and relevant rules of the Rule. 3. Notice to show-cause was also issued as to why the penalty should not be imposed on the assessee unde .....

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relevant Rule of the Rule and penalty should not be imposed under Rule 173Q of the Rules for the same; and the Manager(Commercial) and Executive (Central Excise) of the assessee-company will not be penalised under Rule 209A of the Rule. The said notice was adjudicated by the Joint Commissioner (ADJN), CESTAT, Bhubaneswar-I by order dated 30.6.2005. In the said adjudication, the concerned authority confirmed the demand of central excise duties for (i) ₹ 21,398/- on capital goods, (ii) S .....

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uty as demanded by the Department on capital goods, cess and other infraction as pointed out by the Department in the show-cause. That apart the concerned adjudication authority confiscated a quantity of 62,314 metric ton of paper and imposed penalty of ₹ 1,00,000/- on the assessee besides imposition of additional penalty of ₹ 1,00,000/- on its Manager(Commercial) and Executive (Central Excise). 4. Challenging the said order-in-original, the assessee along with its officers preferred .....

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eswar, the present appellant filed three separate appeals along with stay petition before the learned CESTAT which are registered as Excise Appeal No. 674 of 2006-against the appellant, Excise Appeal No. 250 of 2007-against the Manager(Commercial) and Excise Appeal No. 251 of 2007-against the Executive (Central Excise) of respondent-company. Be it stated that vide common order dated 13.5.2008 learned CESTAT dismissed the Excise Appeal Nos. 250 and 251 of 2007 with observation that the appeal fil .....

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. 674 of 2006, the present appeal has been filed with the following three substantial questions of law : 1) Whether, in the facts and circumstances of the case, the Ld. CESTAT is correct in dismissing the appeal preferred by the Appellant/Department, on mere technical ground of lack of proper authorization by the Committee of Commissioners in term of Sub Sec.2 of Sec. 35B of the Act, though a plain reading of Sec.35-B and more specifically presence of word may , in its Sub Sec.2, gives a very cl .....

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B(1)(b) of the Act, gives right to any person, which very much includes the Appellant/Department to prefer an appeal before the Appellate Tribunal, if aggrieved by the any order passed by the Commissioner (Appeals) under Sec.35-A? 3) Whether, in the facts and circumstances of the case, the Ld. CESTAT is correct in dismissing the appeal preferred by the Appellant/Department, on mere technical ground of lack of proper authorization by the Committee of Commissioners in term of Sub Sec. 2 of Sec. 35 .....

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ed that the learned CESTAT has failed to apply judicial mind to the facts of the case and landed in a wrong conclusion. Learned CESTAT has erred in law to appreciate that presence of authorisation by Commissioner of Central Excise in the record itself and at the same time dismissed the appeal without going through the same. The authorization as appearing in sub-section (2) of Section 35B of the Act is more directory one but not mandatory and learned CESTAT has failed to appreciate this principle .....

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ant of authorization of the Committee of Commissioners in terms of subsection( 2) of Section 35B of the Act is completely an intra7 departmental administration decision making procedure and there is no scope of advancing pleadings and deciding any lis between the parties for which non-compliance of the said administrative flaw, cannot be fatal to the quasi-judicial proceeding initiated. He also strenuously argued that the dismissal order passed by the learned CESTAT only on the ground of lack of .....

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ise, Customs and Service Tax, Bhubaneswar-I under Commissionerate being in charge of Bhubaneswar-II Commissioner, made authorisation in due capacity and has to be treated as valid authorization in this appeal. It is also submitted by the learned counsel for the appellant-department that common authorization dated 24.6.2008 of all the three appeals including the present appeal against the respondent was signed by both the Commissioners of Bhubaneswar-I & II Commissionerate and the same are al .....

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sel for the respondent submitted that no authorization by the Committee of Commissioners as required under sub-section (2) of Section 35B of the Act was filed while the appeal was preferred by the learned CESTAT for which the order passed by learned CESTAT can neither be said that it is without application of mind nor it is without jurisdiction. It is further submitted by learned counsel for the respondent that the compliance of sub-section (2) of Section 35B of the Act in preferring appeal is m .....

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different facts and circumstances but not identical issues raised in this case. According to him after amendment of concerned provision of the Central Excise Act, 2005 , the Committee of Commissioners have been entrusted the task of authorization of either Commissioner or any Officer to file the appeal and the purpose of such authorization is not merely authorization of Officer but also take decision to file appeal after deliberating on the facts and law involved in the particular case. So mere .....

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SCUSSION 11. It is admitted by both the parties that the Commissioner of Appeals disposed of the appeal filed by the respondent-company and his two officials for which the Commissioner of Appeals disposed of the Excise Appeal No. 674 of 2006 by the Commissioner on 25.6.2012 against respondentcompany whereas the learned Tribunal disposed of the Excise Appeal Nos.250 & 251 of 2007 preferred by two officers of the company respectively on 13.5.2008. It is not disputed that in the impugned order .....

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the Department, reiterated the grounds of appeal. 3. We find that the appeal against the O/A No.8-1-/B-I/06 dated 20.1.06, has already been decided Vide Tribunal s Final Order No.S-369- 370/A-557-558/Kol/08 dated 13.5.2008. In these circumstances, the present appeal is infructuous and the same is accordingly, dismissed. Dictated and pronounced in the open Court. Sd/- 26.4.2012 (DR. D.M.MISRA) JUDICIAL MEMBER Sd/- 26.4.2012 (S.K.GAULE) TECHNICAL MEMBER 12. It is also not disputed that in the ord .....

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s are dismissed as not maintainable. (Dictated and pronounced in the open Court.) Sd/- 16.5.2008 (DR. D.M.MISRA) JUDICIAL MEMBER Sd/- 16.5.2008 (Dr. Chittaranjan Satapathy) TECHNICAL MEMBER 13. From the foregoing orders, it appears that the impugned order in this appeal has been passed on 25.4.2012 relying upon the order dated 13.5.2008 passed in Excise Appeal Nos.250 & 251 of 2007. Both the orders only indicate that no proper authorization has been filed by the appellant-Department to file .....

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d the Additional Commissioner of Central Excise, Bhubaneswar-I to file appeals before the CESTAT, Kolkata. On going through the order dated 13.5.2008 passed in Excise Appeal Nos.250 & 251 of 2007, it appears it was passed much before the authorisation was made. The impugned order shows that relying on the order dated 13.5.2008 passed in Excise Appeal Nos.250 & 251 of 2007, the impugned order has been passed dismissing the appeal in 2012. The impugned order does not disclose whether cogni .....

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r directory. Sub-sections (1) & (2) of Section 35B of the Act is reproduced herein below : THE CENTRAL EXCISE ACT 1944 35B. Appeals to the Appellate Tribunal.- (1) Any person aggrieved by any of the following orders may appeal to the Appellate Tribunal against such order- (a) a decision or order passed by the Commissioner of Central Excise as an adjudicating authority; (b) an order passed by the Commissioner (Appeals) under section 35A; (c) an order passed by the Central Board of Excise and .....

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Tribunal shall not have jurisdiction to decide any appeal in respect of any order referred to in clause (b) if such order relates to,- (a) a case of loss of goods, where the loss occurs in transit from a factory to a warehouse, or to another factory, or from one warehouse to another, or during the course of processing of the goods in a warehouse or in storage, whether in a factory or in a warehouse; (b) a rebate of duty of excise on goods exported to any country or territory outside India or on .....

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ided further that the Appellate Tribunal may, in its discretion, refuse to admit an appeal in respect of an order referred to in clause (b) or clause (c) or clause (d) where- (i) in any disputed case, other than a case where the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or (ii) the amount of fine or penalty det .....

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behalf to the Appellate Tribunal against such order. Provided that where the Committee of Commissioners of Central Excise differs in its opinion regarding the appeal against the order of the Commissioner (Appeals), it shall state the point or points on which it differs and make a reference to the jurisdictional Chief Commissioner of Central Excise who shall, after considering the facts of the order, if is of the opinion that the order passed by the Commissioner (Appeals) is not legal or proper, .....

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he Act is a condition precedent for filing appeal inasmuch as only after the opinion, by the Committee of Commissioners of Central Excise, the appeal can be filed against the impugned order besides authorization given by the Committee of Commissioners Commissioner of Excise to any officer to file appeal on behalf of the Department. Sub-section (2) of section 35B of the Act has been substituted in 2005 by amending the said provision. Before 2005, the Commissioner of Central Excise alone was given .....

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ent to reduce number of filing of appeals on justifiable grounds instead of filing frivolous appeals. So the amendment brought in sub-section (2) of section 35B of the Act cannot be said an empty formality. Since the litigations have been multiplied on various quarters, the noble idea of bringing such amendment in sub-section (2) of section 35B of the Act cannot be made to be fraustrated by arraying the same as directory provision. When the group of Commissioners apply their mind to the order in .....

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le can be laid down, and that in every case the object of the statute must be looked at. The cases on the subject will be found collected in Maxwell on Statutes, 5th Edn., p. 596 and the following pages. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience, or injustice to persons who have no control over those entrusted with the duty, and at the same .....

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have observed : 23. It is the basic principle of construction of statute that the same should be read as a whole, then chapter by chapter, section by section and words by words. Recourse to construction or interpretation of statute is necessary when there is ambiguity, obscurity, or inconsistency therein and not otherwise. An effort must be made to give effect to all parts of the statute and unless absolutely necessary, no part thereof shall be rendered surplusage or redundant. 18. With due res .....

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the Hon ble Supreme Court. 19. The word may , appearing in sub-section (2) of section 35B of the Act should not be misconceived as submitted by learned counsel for the appellant. The proviso to sub-section (2) of section 35B of the Act also postulates that in the case of difference of opinion between the Commissioner of Central Excise, they will make reference to the Chief Commissioner of Central Excise who after considering the facts, if found that the order of the Commissioner of Central Excis .....

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