TMI Blog2019 (5) TMI 1276X X X X Extracts X X X X X X X X Extracts X X X X ..... ice. iii) To adjudge the attractability of plea of bias, a court is required to adopt a deliberative and logical thinking based on the acceptable touchstone and parameters for testing such a plea and not to be guided or moved by emotions or for that matter by one s individual perception or misguided intuition. The petitioner alleges that Mrs. Charul Baranwal is holding the charge of Commissioner (Appeals) Ludhiana and she is wife of Commissioner who had reviewed order passed by Assistant Commissioner and directed him to file appeal on his behalf before Commissioner (Appeals). Thus, the husband is holding charge of appellant whereas the wife is holding charge of appellate authority. Consequently, there is reasonable apprehension in the mind of the petitioner about the bias. The communication dated 5.11.2018, Annexure P.8 passed by Chief Commissioner, CGST, Chandigarh in refusing to transfer appeal of the petitioner from Commissioner (Appeals) Ludhiana to some other Commissioner (Appeals) is set aside. The appeal of the petitioner is transferred from Commissioner (Appeals), Ludhiana to Commissioner (Appeals), Jalandhar, who will decide the same afresh after hearing the parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... volving the same issue came up for consideration before Commissioner (Appeals), Ludhiana who vide order dated 18.4.2018, Annexure P.2 inspite of decision of the larger bench of the Tribunal concluded that the petitioner was liable to pay duty on fatty acids, gums and Gadh because it was manufacturing plastic and tin containers which were captively consumed. One appeal of the petitioner and two appeals of the department came up for consideration before Commissioner (Appeals), Ludhiana who vide order dated 16.7.2018, Annexure P.3 held that the petitioner was liable to pay duty on fatty acids, waxes, gums etc. The Commissioner (Appeals) reiterated its earlier findings and did not think it appropriate to consider submissions of the petitioner whereby the petitioner had pointed out that the order was not passed on the basis of the said issue and earlier Commissioner (Appeals) had already settled the issue of manufacture of plastic containers in its favour. The officials of the Directorate General of Central Excise Intelligence (DGCEI) searched premises of the petitioner on 29.7.2011 and seized 1238 kg stearic flakes. The DGCEI initiated investigation against the petitioner alleging that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Commissioner (Appeals) in the interest of justice. A number of appeals have already been transferred from one Commissioner (Appeals) to another. The Commissioner (Appeals) vide notice dated 18.12.2018, Annexure P.10 fixed the matter for hearing on 10.1.2019. According to the petitioner, the appeal which is pending before Commissioner (Appeals) Ludhaina has been filed on the basis of review order passed by Mr. Baranwal who is husband of Mrs. Charul Baranwal holding charge of Commissioner (Appeals) which is clear conflict of interest and it is against the principles of natural justice as well as equity that appeal has been filed by husband and wife is acting as Appellate Authority. The petitioner has no hope and trust that respondent No.4 could decide the appeal in fair and unbiased manner and thus prays that the appeal should be heard by some other Commissioner (Appeals) Hence the instant writ petition by the petitioner before this Court. 3. A written statement has been filed on behalf of respondent Nos. 1 to 4 through Commissioner (Appeals), CGST, Ludhaina wherein it has been inter alia stated that the appeal filed by the petitioner was rightly dismissed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g before Commissioner (Appeals), Ludhiana. 6. Before adjudicating the controversy involved in the present case, the settled legal position on the doctrine of bias may be noticed. Bias is one of the limbs of natural justice. The doctrine of bias emerges from the legal maxim nemo debet esse judex in propria causa. It applies only when the interest attributed to an individual is such so as to tempt him to make a decision in favour of or to further his own cause. There may not be case of actual bias or an apprehension to the effect that the matter most certainly will not be decided or dealt with impartially but where the circumstances are such so as to create a reasonable apprehension in the minds of others that there is likelihood of bias affecting the decision, the same is sufficient to invoke the doctrine of bias. Question of bias depends on the facts and circumstances of each case. It cannot be an imaginary one or come into existence by an individual s perception based on figment of imagination. While dealing with the plea of bias advanced by the delinquent officer or an accused, a court or tribunal is required to adopt a rational approach keeping in view the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gency to determine questions affecting the rights. The two basic principles of natural justice are: 1) NEMO JUDEX IN CAUSA SUA ( No one should be made a Judge in his own case or rule against bias) 2) AUDI ALTERAM PARTEM ( Hear the other party, or the rule of Fair Hearing or the Rule no one should be condemned unheard) 18. In the instant case we are concerned with the first principle. Prof. Wade elucidated the principle as follows: Nemo Judex in Re Sua - a Judge is disqualified for determining any case in which he may be, or may fairly be suspected to be, biased. So important is the rule that Coke supposed, as we have seen, that it should prevail even over an Act of Parliament. 19. Lord Hewart C.J , founded the rule in Rex v. Sussex (1924) 1 KB 256 thus: a long line of cases shows that it is not merely of some importance but is of fundamental importance that justice should not only be done, but should manifestly and undou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him. They convicted M, the applicant, and imposed a fine of 10 and costs. It was then brought to the notice of the Justices that the deputy clerk was a brother of solicitor of W. The question before the court was, whether the judgment was invalidated on account of bias. Lord Hewart C.J, with whom other Law Lords concurred, held that decision was invalidated due to bias. 8. In K.B.Sathyanarayana Rao and others v.s State of Karnataka and others, AIR 1977 Karnataka 221, it was held by the Karnataka High Court that if a member of a Tribunal is related to one of the parties then it is a clear case of bias. The observance of rules of natural justice require that there should be fair hearing and that person should not preside over a Tribunal. If such a person participates in the proceedings of the Tribunal, the proceedings will be clearly vitiated. The relevant observations read thus:- 3 .The allegation made in this writ petition that the said Honnappa had throughout participated in the proceedings has not been disputed. The order passed by the Tribunal and produced in this case does not bear the signature of the said Honnappa. If, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion are really inconsistent with each other. We think that the reviewing authority must make a determination on the basis of the whole evidence before it, whether a reasonable man would in the circumstances infer that there is real likelihood of bias. The court must look at the impression which other people have. This follows from the principle that justice must not only be done but seen to be done. If right-minded persons would think that there is real likelihood of bias on the part of an inquiring officer, he must not conduct the inquiry; nevertheless, there must be a real likelihood of bias. Surmise or conjecture would not be enough. There must exist circumstances from which reasonable men would think it probable or likely that the inquiring officer will be prejudiced against the delinquent. The court will not inquire whether he was really prejudiced. If a reasonable man would think on the basis of the existing circumstances that he is likely to be prejudiced, that is sufficient to quash the decision [see per Lord Denning, M.R in Metropolitan Properties Co. (F.G.C) Ltd. v. Lannon ( 1968) 3 WLR 694 (WLR at p. 707]. 36. Thereafter, the two-Judge Bench refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not. The decision maker should have no interest by way of gain or detriment in the outcome of a proceeding. Interest may be in many forms. It may be direct, indirect, arising from a personal relationship or relation with the subject matter or from a tenuous one. The relevant observations read thus:- 21. Bias is the second limb of natural justice. Prima facie no one should be a judge in what is to be regarded as Rs.sua causa', whether or not he is named as a party. The decision-maker should have no interest by way of gain or detriment in the outcome of a proceeding. Interest may take many forms. It may be direct, it may be indirect, it may arise from a personal relationship or from a relationship with the subject-matter, from a close relationship or from a tenuous one. 22. In the case of non-pecuniary bias, as alleged in the instant case, regard is to be had to the extent and nature of interest. Then alone, the judge will be disqualified. In the leading case R. v. Sussex Justices , ex p McCarthy, Lord Hewart observed thus: It is not merely of some importance but is of fundamental importance, that j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner was liable to pay duty on fatty acids etc. Still further, one appeal by the petitioner and two appeals of the Department were decided by Mrs. Charul Baranwal, Commissioner (Appeals) vide order dated 16.7.2018 (Annexure P.3) holding the petitioner liable to pay duty on fatty acids etc. The petitioner alleges that Mrs. Charul Baranwal is holding the charge of Commissioner (Appeals) Ludhiana and she is wife of Commissioner who had reviewed order passed by Assistant Commissioner and directed him to file appeal on his behalf before Commissioner (Appeals). Thus, the husband is holding charge of appellant whereas the wife is holding charge of appellate authority. Consequently, there is reasonable apprehension in the mind of the petitioner about the bias. 13. In view of the factual position in the present case and the settled position of law on the issue, as narrated above, the writ petition is allowed. The communication dated 5.11.2018, Annexure P.8 passed by Chief Commissioner, CGST, Chandigarh in refusing to transfer appeal of the petitioner from Commissioner (Appeals) Ludhiana to some other Commissioner (Appeals) is set aside. The appeal of the petitioner is tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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