TMI Blog2023 (10) TMI 449X X X X Extracts X X X X X X X X Extracts X X X X ..... e than 7 years and now again the petitioner received a notice for personal hearing dated 21.06.2022 for adjudication of the show cause notice dated 24.12.2014. It further transpires that Section 73(4B) provides for determination of service tax liability and adjudication of the show cause notices within period of six months, where it is possible to do so in case where the show cause notice is issued under the main section 73(1) involving no suppression of facts etc. and within a period of one year where the show cause notice is issued under proviso to Section 73(1) of Chapter V of the Finance Act, 1994, where it is possible to do so - Sub-Section (4B) was inserted in Section 73 of Chapter V of the Finance Act, 1994 w.e.f. 06.08.2014 by Finance (No. 2) Act, 2014. Similar provisions exist under Section 11A (11) of the Central Excise Act, 1944 and Section 28(9) the Customs Act, 1962. The period of limitation of 6 months or 1 year under Section 73(4B) of the Chapter V of the Finance Act, 1994 be extended to more than seven years as is done in the instant case. In the case of KM SHARMA VERSUS INCOME TAX OFFICER [ 2002 (4) TMI 7 - SUPREME COURT ] it is held by the Hon ble Apex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, J. The instant application has been preferred for the following reliefs:- (i) For issuance of writ(s), order(s) and/or direction(s), for quashing and setting aside the impugned Show Cause Notice dated 24.12.2014 bearing No. C. No. V(65) 03/ Inv/ KCPL/ RNC-II (Bok)/2014/637 (Annexure-1) issued by Respondent No. 2, and directing the Respondents to cancel, rescind and/or withdraw the same; (ii) For issuance of writ(s), order(s) and/or direction(s), for quashing and setting aside the impugned Notice dated 06.06.2022 bearing No. C. No. V (65) 03/Adjn./KCPL/Bok(Ran-II)/2014/3167 (Annexure-2) issued by the Superintendent (Adjudication) O/o Principal Commissioner of Central Goods and Services Tax and Central Excise, Central Revenue Building, 5-A, Mahatma Gandhi Road (Main Road), Ranchi - 834001, the Respondent No. 3; (iii) Pending final hearing of this Petition, the Respondents, their servants, agents and subordinates be restrained from giving any effect and/or further effects to and/or acting on the basis of Petitioner in the present writ Petition under Article 226/Article 227 of the Constitution of India is challenging the legality and validity of impugned Show Cau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g was kept under suspended animation till a fresh date for personal hearing has been fixed on 06.06.2022. Learned counsel contended that the same issue has been under consideration as respects the Central Excise Act, 1944 and Customs Act, 1962 before different jurisdictional High Courts and it has been held that the time limit has to be strictly adhered to if the Revenue does not have explanation for the delay in completing adjudication proceedings. In crux Mr. Kurmy contended that:- (A) The words where it is possible to do so under Section 73(4B) of Chapter V of the Finance Act, 1994 does not extend the time limit perpetually to an indefinite period but is intended to deal with extra ordinary situation only based on reasonable ground. In case, there is no extra ordinary - situation, the said time limit would provide the period of limitation for completion of adjudication. (B) Section 73(4B) of the Chapter V of the Finance Act, 1994 recognizes the well settled principle that delay in adjudication of a dispute causes prejudice to parties and is contrary to Article 14 of the Constitution of India, 1950. (C) In case where no time limit has been prescribed, the actio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication Order shall have to be passed. On many occasions, the OIO is passed after many years after the issue of show cause notice. In the instant case, Demand cum Show Cause Notice was issued on the basis of investigation conducted which were well within the knowledge of the petitioner and the same are to be decided, after taking into account their written submission and submissions tendered during personal hearing, by issuing an appealable Order. The Demand cum show cause notice and subsequent order is a part of principle of natural justice. Thus, notice issued for personal hearing before passing an adjudication order is a part of principle of natural justice given to the petitioners. Due to some administrative constraint emanated after major changes in the indirect taxation laws in the past years, the said adjudication order got delayed as huge legacy cases were to be decided. The Principal Commissioner who conducted the personal hearing earlier had been transferred before passing the order. The present adjudicating authority, before deciding the case, ordered the Superintendent (Adjn.) to issue a personal hearing notice, which is a part of the principle of natural justice giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are suspected. The Writ Petition will stand dismissed. (iii) The Hon ble Apex Court in the matter of Civil Appeal No 5121 of 2021 (Arising out of SLP (C) No 13639 of 2021 @ D No. 11555 of 2020) (The Assistant Commissioner of State Tax Others vs M/s Commercial Steel Limited) has pronounced that; 11. The respondent had a statutory remedy under section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be entertained in exceptional circumstances where there is: (i) a breach of fundamental rights; (ii) a violation of the principles of natural justice; (iii) an excess of jurisdiction; or (iv) a challenge to the vires of the statute or delegated legislation. Mr. Pati reiterated that the Hon ble Apex Court in catena of judgments has held that the writ application can be entertained in the exceptional circumstances where there is a breach of fundamental rights or violation of principle of natural justice or on the point of jurisdiction or the v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and mere surplusage. The outer limits fixed by the Legislature under Sub-Section (4B) of Section 73 of Chapter V of the Finance Act, 1994 is not without a purpose but manifests the legislative intent and declares the legislative policy that the adjudication of the show cause notices must be completed within a reasonable time frame set out under Section 73(4B) unless an extra ordinary situation arises beyond the control of the adjudicating authority and it can never be kept pending for an indefinite period or sine die. 10. Similar provisions exist under Section 11A (11) of the Central Excise Act, 1944 and Section 28(9) the Customs Act, 1962. The period of limitation of 6 months or 1 year under Section 73(4B) of the Chapter V of the Finance Act, 1994 be extended to more than seven years as is done in the instant case. In the case of K.M Sharma Vs. ITO reported in (2002) 4 SCC 339 it is held by the Hon ble Apex Court that the provisions of a fiscal statute more particularly one regulating the period of limitation must receive a strict construction as the law of limitation is intended to give certainty and finality to legal proceedings. 14. A fiscal statute, more partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid rule is to the effect: (ER p. 1057) If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves alone do, in such case, best declare the intention of the lawgiver. It is a cardinal principle of construction of a statute that when the language of the statute is plain and unambiguous, then the court must give effect to the words used in the statute and it would not be open to the courts to adopt a hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. In Kirkness v. John Hudson Co. Ltd. [(1955) 2 All ER 345 : 1955 AC 696 : (1955) 2 WLR 1135] Lord Reid pointed out as to what is the meaning of ambiguous and held that: (All ER p. 366 C-D) A provision is not ambiguous merely because it contains a word which in different contexts is capable of different meanings. It would be hard to find anywhere a sentence of any length which does not contain such a word. A provision is, in my judgment, ambiguous only if it contains a word or phrase which in that particu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the reference is answered. But Parliament having enacted Section 28-A, as a beneficial provision, it would cause great injustice if a literal interpretation is given to the expression had not made an application to the Collector under Section 18 in Section 28-A of the Act. The aforesaid expression would mean that if the landowner has made an application for reference under Section 18 and that reference is entertained and answered. In other words, it may not be permissible for a landowner to make a reference and get it answered and then subsequently make another application when some other person gets the reference answered and obtains a higher amount. In fact in Pradeep Kumari case [(1995) 2 SCC 736] the three learned Judges, while enumerating the conditions to be satisfied, whereafter an application under Section 28-A can be moved, had categorically stated (SCC p. 743, para 10) the person moving the application did not make an application to the Collector under Section 18 . The expression did not make an application , as observed by this Court, would mean, did not make an effective application which had been entertained by making the reference and the reference was answ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A construction like this which defeats the intention of the rule- making authority in clause 23 must, if possible, be avoided. 12. In the case of Shree Baba Exports Vs. Commissioner of GST Central Excise reported in (2022) 72 PHT 35 (P H) [Para 13] it is held by the Punjab Haryana High Court that the expression where it is possible to do so does not mean that the time prescribed can be extended perpetually and the time limit cannot be taken to be directory except in a case where the authority has a reason to offer as an explanation for extending the said time limit. In the case of Meghmani Organics Ltd. Vs. UOI reported in 2019 (368) E.L.T. 433 (Guj.) [Para 24] it is held by the Gujarat High Court that when the legislature has used the expression where it is possible to do so it means that if in the ordinary course it is possible to determine the amount of duty with the specified time frame, it should be so done. Similar views have been held in the case of Siddhi Vinayak Put. Ltd Vs. UOI reported in 2017 (352) E.L.T. 455 (Guj.) 19. Reliance was placed upon the decision of the Supreme Court in the case of Abdul Rehman Antulay v. R.S. Nayak, (1992) 1 S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riod of limitation must receive strict construction. The law of limitation is intended to give certainty and finality to legal proceedings and to avoid exposure to risk of litigation to litigants for an indefinite period to future unforeseen event. Section 73 (4B) of the Chapter V of the Finance Act 1994 recognizes the well settled principle that delay in adjudication of a dispute causes prejudice to parties and is contra to Article 14 of the Constitution of India 1950. This provision recognizes that delay in adjudication of a matter causes prejudice and detriment to the party and is however contrary to Article 14 of the Constitution of India, 1950. Fixing personal hearing of the petitioner and taking up adjudication after more than 7 years from the date of issuance of the impugned Show Cause Notice dated 24.12.2014 in the instant case is unreasonable, arbitrary, oppressive, and violates Article 14 of the Constitution and such proceedings stand vitiated due to inordinate and unreasonable delay. In the case of CCE Vs. Krishna Wax Private Ltd reported in (2020) 12 SCC 572 (S.C) [Para 10] it is held by the Hon ble Apex Court that the issuance of Show Cause Notice under Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Excise, Ahmedabad-II on 23-3- 2000, in view of the fact that in a similar case where the demand was dropped by the Surat-I Commissioner which was reviewed by the Board, the Department had filed an appeal. It appears that the Appellate Tribunal had initially dismissed the appeal on the ground of maintainability against which, the Revenue had approached this High Court, which restored the appeal to the Appellate Tribunal. Ultimately, the Appellate Tribunal by an order dated 18-6-2013 dismissed the appeal filed by the Revenue, which order has been accepted by the Revenue. It is after the dismissal of the Revenue's. appeal that the show cause notice has been retrieved from the call book on 26-4-2014, whereafter, after a considerable delay, notice for personal hearing has been issued fixing the personal hearing in November, 2015. Thus, there is a delay of more than one and a half year even after the show cause notice came to be retrieved from the call book. However, in the interregnum the aforesaid events have taken place on account of which the petitioner could not be served with the notice of hearing and the second respondent has proceeded to decide the matter ex parte. 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtainly cannot be for indefinite period. For whatever reason, once recourse to this exceptional situation becomes necessary, then the concept of reasonable time would come into play. It is a settled rule of statutory interpretation that wherever no specific time-limit is prescribed, the concept of reasonable time shall hold the field for completing such an action. The courts in the process of interpretation can supply the lacuna, which would help to achieve the object of the Act and the legislative intent and make the provisions effective and operative. 15. At this stage, it is worth mentioning that the objection of the Revenue with regards to alternative remedy and/or the judgments cited by the Revenue is not applicable in the instant case, inasmuch as, in the case at hand, now it would not be possible for the petitioner to defend its case effectively by culling out relevant records, evidences, producing its witness etc. thus, remitting the matter back would cause serious prejudices to the petitioner at this belated stage. 16. In view of the aforesaid discussions and the law laid down by the Hon ble Apex Court in the judgments referred to hereinabove, we are having no hesi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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