TMI Blog2017 (3) TMI 1284X X X X Extracts X X X X X X X X Extracts X X X X ..... or scope of the appeal that the party intends filing. A party may seek to challenge only that part of the order of the Tribunal which relates to questions other than those relating to the rate of duty of excise or the value of the goods for the purposes of assessment. Such an appeal would, absent any other questions, lie to the High Court. Once it is held that an appeal against the order of the Tribunal which deals with questions that fall within the ambit of Section 35 L as well as other questions lies to the Supreme Court under Section 35 L the mere fact that the party chooses to challenge only that part of the order that falls within the ambit of Section 32 G would make no difference. It is not the order-in-original i.e. the order of the adjudicating authority but the order of the Tribunal that would determine the issue as to whether the appeal lies to the High Court under Section 35 G or to the Supreme Court under Section 35 L. Section 35 G provides for an appeal to the High Court from every order passed in appeal by the appellate Tribunal. It is, therefore, the order of the Appellate Tribunal that must determine the issue. The determination of the question as to whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of excise or to the value of goods for the purposes of assessment. In other words it is common ground that the impugned order of the Tribunal even in so far as it concerns the respondent alone deals with the issues relating to the rate of excise duty and/or to the value of goods for the purposes of assessment as well as with other issues. The question that arises is whether an appeal is maintainable under Section 35 G to the High Court where the order of the Tribunal deals with questions having a relation to the rate of duty of excise or to the value of goods for the purposes of assessment as well as with other questions. In our view, the question must be answered in the negative. An appeal against such an order lies only to the Supreme Court under Section 35 L of the Act. 5. Sections 35 G and 35 L of the Act reads as under:- 35G. Appeal to High Court- (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ajority, the Judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it. (9) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this Section. 35L. Appeal to the Supreme Court (1) An appeal shall lie to the Supreme Court from - (a) any judgment of the High Court delivered- (i) in an appeal made under Section 35G; or (ii) on a reference made under Section 35G by the Appellate Tribunal before the 1st day of July, 2003; (iii) on a reference made under section 35H, in any case which, on its own motion or on an oral application made by or on behalf of the partly aggrieved, immediately after passing of the judgment, the High Court certifies to be a fit one for appeal to the Supreme Court; or (b) any order passed before the establishment of the N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t even the respondent was not entitled to the benefit of the said circular. ₹ 19,86,648/- was, therefore, demanded by the appellant from the respondent. This, it has been held, is a question that relates to the rate of duty. Had this been the only question before the Tribunal, an appeal against the decision of the Tribunal would not have been maintainable under Section 35 L to the Supreme Court. Before the Tribunal, however, there were other questions as well. SBM sold the goods to a number of buyers as well as to RWM. The Department alleged that the goods sold in cash to persons other than the respondent had actually been cleared to the respondent who used the same for the manufacture of unaccounted goods and the same had been cleared clandestinely without payment of duty. A demand for duty of ₹ 32,64,160/- has, therefore, been made against the respondent in this regard. Thus, against this respondent alone, the Tribunal dealt with questions relating to the rate of duty as well as to questions that do not relate to the rate of duty or to the value of the goods for the purposes of assessment. The Commissioner by the order-in-original adjudicated the matter. He conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ambit of Section 35 G as well as with questions that fall outside the ambit of Section 35 G and within the ambit of Section 35 L of the Act. 9. We reiterate that we are not concerned here with the merits of the findings. While deciding the maintainability of the appeal, the merits are not relevant. It is necessary only to note the questions that were determined by the Appellate Tribunal. 10. Section 35 G provides for an appeal to the High Court from every order passed in appeal by the Appellate Tribunal on or after 01.07.2003 (not being an order, relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of assessment). Thus, an appeal under Section 35 G is against the order passed in appeal by the Appellate Tribunal and not against the order of the Adjudicating Authority. An appeal does not lie to this Court from the order of the adjudicating authority/Commissioner. The issue as to whether an appeal is maintainable or not must, therefore, be decided on the basis of and taking into consideration the order passed in appeal by the appellate authority and not by the order passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me order of the Tribunal- two in the High Court and two in the Supreme Court. It was precisely to avoid these situations that Section 32 G was enacted. It was to avoid the bifurcation of proceedings before the Supreme Court and the High Court. 13. This would also avoid conflicting findings. A view to the contrary would lead to the possibility of an appeal against the order of the Tribunal being maintainable in certain respects before the High Court and in other respects before the Supreme Court. This could lead to considerable confusion and complication. For instance, it may well be necessary in a given case for the Supreme Court to refer to, analyse and adjudicate upon the facts in relation to an order relating to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of assessment. It may equally be necessary for the High Court in an appeal against the same order to consider, analyse and adjudicate upon the same facts but in relation to the other questions. Although theoretically, it would be possible to bring the matter to a conclusion with consistent findings the process would be considerably cumbersome and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsus Scot Wilson Kirkpatrick (I) Pvt. Ltd., 2011 (23) S.T.R. 321 (Kar.), held:- 13. In order to appreciate this contention, we have to carefully see the wordings employed by the legislature. The relevant words are as under : - Not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of Service for the purposes of assessment . The key word in the said provision is for the purpose of assessment . That means the order referred to therein is an order passed in the course of assessment. Therefore, all orders passed in the course of assessment involving the determination of any question having a relation to the rate of duty of service or to the value of Service, cannot be the subject matter of appeal before the High Court. By the use of the word among other things it is made clear, even order which may not be directly related to the rate of duty of service or the value of Service, however which are intermingled with those matters are also excluded. In other words those are not the only orders contemplated by the legislation. In order to understand the width and depth of the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion Bench of this Court has stated : 3. On a plain reading of Section 35G of the Central Excise Act, 1944 it is clear that no appeal would lie to the High Court from an order passed by CESTAT if such an order relates to, among other things, the determination of any question having a relation to the rate of duty or to the valuation of the taxable service. It has nothing to do with the issues sought to be raised in the appeal but it has everything to do with the nature of the order passed by the CESTAT. It may be very well for the appellant to say that it is only raising an issue pertaining to limitation but the provision does not speak about the issues raised in the appeal, on the other hand, it speaks about the nature of the order passed by the Tribunal. If the order passed by the Tribunal which is impugned before the High Court relates to the determination of value of the taxable service, then an appeal from such an order would not lie to the High Court. 4. However, we feel that although those decisions do support the contention of the learned counsel for the respondent, the approach that we have taken is a more direct. We reiterate, it is not the content of the appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether an appeal would lie in the High Court under Section 35 G or in the Supreme Court under Section 35 L. In our view it is not the order-in-original i.e. the order of the adjudicating authority but the order of the Tribunal that would determine the issue as to whether the appeal lies to the High Court under Section 35 G or to the Supreme Court under Section 35 L. Section 35 G provides for an appeal to the High Court from every order passed in appeal by the appellate Tribunal. It is, therefore, the order of the Appellate Tribunal that must determine the issue. Moreover Section 35 G restricts the ambit of the appeal to orders of the Tribunal not being an order relating, among other things, to the determination .. . The words an order relate to the order passed in appeal by the Appellate Tribunal. 19. We are in respectful agreement with the above judgments except to the extent indicated above. 20. Mr. Sethi, on the other hand, relied upon the following observations of the judgment of the Allahabad High Court in the Commr. of Cus. C. Ex., Meerut-II Versus Honda Siel Power Products Ltd., 2016 (332) E.L.T. 222 (All.):- 10. Section 35G of the Act provides that an app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he scope of the appeal does not determine the question as to whether an appeal is maintainable under Section 35 G or Section 35 L. 21. Mr. Sethi then relied upon the following observations in Commr. Of C. Ex., Cus. S.T., Bharuch Versus Shree Krishna Industries, 2016 (338) E.L.T. 535 (Guj.):- 12. From the principles propounded in the above decision what emerges is that for the purpose of falling within the ambit of the phrase relation to the controversy involved must have a direct and proximate relationship to the rate of duty and to the value of goods for the purpose of assessment and that the controversy must be such that the decision rendered thereon would have a wide application. The facts of the present case are required to be examined in the light of the above principles. 13. In the opinion of this Court, from the facts as appearing from the record, the controversy before the Tribunal did not relate to the determination of any question having a relation to the rate of duty or value of goods for the purposes of assessment. Under the relevant exemption notification, an SSI unit is not entitled to the benefit thereof for the clearances exceeding rupees one crore ..... 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