9911796707
TMI Blog2016 (12) TMI 1175X X X X Extracts X X X X X X X X Extracts X X X X ..... r Cigarettes with effect from 30.10.1999. That by Notification No.45/99-CE dated 31.12.1999 exemption granted under Notification No.32/99-CE was withdrawn with respect to Tobacco and tobacco products, Cigarettes, chewing tobacco etc. falling under Chapter 24 of the Central Excise Tariff Act, 1986. That by another Notification No.1/2000-CE dated 17.01.2000 exemption to above products falling under Chapter 24 was restored. (ii) That appellant manufactured and dispatched Cigarettes during the period October, 1999 to September 15, 2000 and refund upto 15th June, 2000 was granted to the Appellant but refund claims of Rs. 1,89,45,120/-; for the second fortnight of June, 2000 to second fortnight of July, 2000; were kept in abeyance by Revenue. (iii) That in January, 2001 Writ Petition (C) 446 of 2001 was filed by the Appellant in Gauhati High Court against non-payment of refunds under Notification No.32/99-CE, as amended resulting in non-payment of duty by appellant and ultimately factory stopped production from September, 2000. That by a further Notification No.1/2001-CE dated 22.01.2001 Central Govt. again withdrew exemption under Notification No.32/99-CE, inter-alia, to A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aside Order dated 19.04.2012 of the High Court and remanded the matter to Gauhati High Court to deal with questions of law set out in paragraph-1 of High Court's order dated 19.04.2012. (x) That by order dated 19.11.2014 in remand proceedings Gauhati High Court remanded the matter to the Tribunal for fresh consideration on merits in accordance with law. (xi) That no letter/recovery memo was received by the Appellant under Section 154 of the Finance Act, 2003 and the same was invoked for the first time in the Order-in-Original dated 31.10.2007 without even giving the exact quantification of demand and interest required to be paid by the Appellant. That on merit there is nothing to argue in view of Apex Court's judgement in RC Tobacco Pvt.Ltd. vs. UOI (supra) but quantum of duty and interest calculated had to be intimated to the appellant as part o the recovery proceedings under Section 154(4) of the Finance Act, 1944. It was also his case that period of one month and amount of interest payable under Section 154(4) of the Finance Act, 2003 will start only from the date of receipt of quantified amounts under a recovery order/letter from the Department as per the followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Bench, Gauhati High Court and Supreme Court. By virtue of Sec.154 of the Finance Act, 2003 Govt. of India retrospectively made Notification No.32/99-CE inapplicable, inter-alia, to cigarettes manufactured by the appellant and provided recovery of amounts from the assesses as per Sec.154(4) of the Finance Act, 2003. Hon'ble Apex Court in its judgment R.C. Tobacco Pvt. Ltd. -vs.- Union of India [2005(188)ELT 129(S.C.)] upheld the constitutional validity of Sec.154 of the Finance Act 2003 and has also held that period of demand under Sec.11A of the Central Excise Act 1944 would not apply to the recovery of dues under Sec.154(4) of the Finance Act, 2003. On merits of the issue regarding non-applicability of Notification No.32/99-CE to the appellant and payment of benefits claimed under Notification No.32/99-CE and demand of duty/interest not paid, there cannot be any dispute in view of the decision of Apex Court in the case of R.C. Tobacco vs. UOI(supra). Appellant has argued that a quantified recovery letter/communication was required to be issued to them, under the provisions of Sec.154(4) of the Finance Act, 2003 specifying the demands/refund paid to them, alongwith specified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned Gauhati High Court in Para-5 of their Order dated 19.11.2014 has recorded the contention of the appellant that tribunal hastily disposed of the appeal also while hearing the stay application. We are of the considered opinion that there is no bar that both the stay application and the appeal cannot be taken simultaneously for disposal when sufficient opportunity is extended to both sides to place their arguments on record. 6. So far as question at Para-4.1(ii) above is concerned the same has been answered by Hon'ble Apex Court, in Para-41 of Order dated 19.09.2005 in the case of R.C.Tobacco Pvt. Ltd. -vs.-Union of India (Supra), where it has been laid down that amounts can be recovered under Sec.154(4) of the Finance Act, 2003 and the limitations of Sec.11A of the Central Excise Act, 1944 would not apply to such recovery. It is , therefore, held that the show cause notices issued to the appellant under Sec.11A and Sec.11AB of the Central Excise Act, 1944 do not survive after Sec.154(4) of the Finance Act, 2003 came into force in 2003 after assent given by the President of India. It is further observed from the Order-in-Original dated 31.10.2007, passed by the Adjudica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e matter. While the law on the principle of audi alteram partem has progressed in the manner mentioned above, at the same time, the Courts have also repeatedly remarked that the principles of natural justice are very flexible principles. They cannot be applied in any straight-jacket formula. It all depends upon the kind of functions performed and to the extent to which a person is likely to be affected. For this reason, certain exceptions to the aforesaid principles have been invoked under certain circumstances. For example, the Courts have held that it would be sufficient to allow a person to make a representation and oral hearing may not be necessary in all cases, though in some matters, depending upon the nature of the case, not only full-fledged oral hearing but even cross-examination of witnesses is treated as necessary concomitant of the principles of natural justice. Likewise, in service matters relating to major punishment by way of disciplinary action, the requirement is very strict and full-fledged opportunity is envisaged under the statutory rules as well. On the other hand, in those cases where there is an admission of charge, even when no such formal inquiry is held, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that order passed is always null and void. The validity of the order has to be decided on the touchstone of 'prejudice'. The ultimate test is always the same, viz., the test of prejudice or the test of fair hearing. XX XX XX XX XX XX XX XX XX XX XX XX 33. So far so good. However, an important question posed by Mr. Sorabjee is as to whether it is open to the authority, which has to take a decision, to dispense with the requirement of the principles of natural justice on the ground that affording such an opportunity will not make any difference? To put it otherwise, can the administrative authority dispense with the requirement of issuing notice by itself deciding that no prejudice will be caused to the person against whom the action is contemplated? Answer has to be in the negative. It is not permissible for the authority to jump over the compliance of the principles of natural justice on the ground that even if hearing had been provided it would have served no useful purpose. The opportunity of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but to follow the dicta in R.C. Tobacco (supra). It is important to note that as far as quantification of the amount is concerned, it is not disputed at all. In such a situation, issuance of notice would be an empty formality and we are of the firm opinion that the case stands covered by 'useless formality theory'." 7.1. Keeping in view the above facts, when quantification of amounts demanded were not disputed, Apex Court held that issuing of a demand show cause notice for the amount recoverable under the mandate of Section 154 of the Finance Act, 2003 will be an empty formality and stands covered by 'useless formality theory'. The amount of duty in the case of Dharampal Satyapal vs. DCCE, Gauhati (supra), decided by Apex Court, was also quantified and communicated to the appellant Dharmapal Satyapal Ltd. by a recovery order of June, 2003, as evident from Paras-6 and 39 of this case law. In the present proceedings before us there is no communication/recovery order from the department for recovery of Rs. 2,15,15,160/- and Rs. 2,76,90,000/- and quantified interest payable under Sec.154(4) of the Finance Act, 2003. It is further observed that Hon'ble Apex Court in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03. Interest under Sec.11AB on duty payable under Sec.11A starts from the date the duty is due till the same is paid by the appellant. The rate of interest fixed under Sec.11AB of the Central Excise Act, 1944 can vary from 10% to 36% and is subject to periodical charges. It is not coming out from the proceedings whether rate of interest has remained uniform @24% from the dates duties becoming due till the enactment of Finance Act, 2003. 7.1.2. So far as chargeability of interest on sanctioned and paid refund under Notification No.32/99-CE dated 08.07.1999 is concerned Hon'ble Apex Court in the case of R.C. Tobacco Pvt.Ltd. vs. UOI (supra) held as follows in para 40. "40. Although Section 11A does not refer to Sec.11B, it speaks of duties erroneously refunded. It cannot therefore refer to refunds made to the petitioners under the notifications as there was no error in the provisional refunds made under the notifications the appellants what was sought to be recovered under Section 154 was not an erroneous refund but benefit provisionally granted." 7.1.3. In view of the above refunds sanctioned to the appellant were not recoverable as erroneous refunds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xercise of recovery and payment by appellant could be completed within 30 days. Learned AR argued that a letter dated 01.12.2005, written by Deputy Commissioner, could be considered as due communication under Section 154(4) of the Finance Act, 2003. It is observed from this letter dated 01.12.2005 that this communication also does not give quantified amounts and interest required to be paid by the Appellant within 30 days stipulated under Section 154(4) of the Finance Act, 2003. Appellant has every right to contest the quantification of amounts due and the interest chargeable on the demands indicated in the Recovery Order. To that extent appellant's right of fair representation cannot be taken away. Even Apex Court in Paras 24-31, 33, 36 & 37 of the case law Dharampal Satyapal vs. DCCE, Gauhati (supra) has not laid down that principles of natural justice need not be complied reasonably when quantification of amounts/interest due are challenged as has been agitated by the appellant in the present proceedings. 8.1 Under the existing factual matrix ratio laid down by Apex Court in the case of CCE, Hyderabad vs. Associated Cement Companies Ltd. (supra) and CCE, Meerut vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
