TMI Blog2023 (11) TMI 558X X X X Extracts X X X X X X X X Extracts X X X X ..... vaded needs to be imposed and there is no discretion to any authority as held by the Hon ble Supreme Court in the case of UNION OF INDIA VERSUS M/S RAJASTHAN SPINNING WEAVING MILLS AND COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE VERSUS M/S. LANCO INDUSTRIES LTD. [ 2009 (5) TMI 15 - SUPREME COURT] . The appeal of the Revenue is having merits and needs to be allowed - Appeal filed by the Revenue is allowed. - ( P. K. CHOUDHARY ) MEMBER ( JUDICIAL ) And ( SANJIV SRIVASTAVA ) MEMBER ( TECHNICAL ) Shri Manish Raj , Authorized Representative for the Appellant None for the Respondent ORDER SANJIV SRIVASTAVA : This appeal filed by revenue is directed against the Order-In-Original No. 49/Commr./LKO/CX/2010-11 dated 31.12.2010 of the Commissioner, Central Excise Service Tax, Lucknow. While adjudging the case demand of central excise duty of Rs.137.50 Lakhs Rs.275.00 Lakhs has been confirmed against on the respondent. However, while imposing a penalty, a penalty of only Rs.137.50 lakhs has been imposed on the appellant under Section 11AC of the Central Excise Act, 1944. 2.0 Revenue has filed this appeal only seeking a modification in the impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appear for personal hearing on 16.6.2010. 44. A letter dated 30.6.2010 was received from Shri Ranjeet Verma and Smt Seema Verma wherein it was informed that indicating that they are residing at the new address: i.e Clo Smt Kamlesh Verma, Behind RDSO Gurudwara, Deep Nagar, Lucknow, Mobile No 7668508147. 45. According to the request of the assesse and Smt Seema Verma another opportunity /date for personal hearing on 17.8.2010 at 11.30 Hrs was given to M/s Harsh Traders, 165, Deep Nagar, Lucknow and Smt Seema Vema, w/o Shri Ranjeet Verma and M/s Aditya Packs, Lucknow vide this office C.No V(30)Adj)/Lko/238/2009/8255-58 dated 21.7.2010. 46. The letter was sent for delivery through Range Superintendent. The Superintendent, Central Excise, Range-1. Talkatora, Division-1, Lucknow informed that he had contacted Shri Ranjeet Verma on 29.7.2010, on the mobile number communicated by the assessee in letter dated 30.6.2010 to serve the letter for personal hearing fixed on 17.8.2010. Shri Ranjeet Verma had informed that he would be available at his sister's place (ie at the new address mentioned in his letter dated 30.6.2010) around 13.00 Hrs to receive the letter. The officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aring on 27.9.2010 at the front door of the premises of M/s Harsh Traders, 165, Deep Nagar, RDSO, Lucknow and at the door of Smt Kamlesh Verma under the proper Panchnama dated 24.9.2009. 51 Shri Ranjeet Verma, proprietor of M/s Harsh Traders. 165-Deep Nagar, RDSO, Manak Nagar, Lucknow and Smt Seema Verma both failed to turn up for personal hearing on 27.9.2010 at 11.30 Hrs also. Since ample opportunity had been provided to the noticees to represent their case and they seem to be deliberately misusing the time given to them. I propose to take up the case for adjudication on the basis of records available. 6.0 We also note that Hon ble Supreme Court has in the case of Ishwarlal Mali Rathod [Order dated September 20, 2021 in Special Leave Petition (Civil) Nos.1411714118 OF 2021] has observed the case as follows: 1. Present is the classic example of misuse of the adjournments granted by the court. Present SLPs have been preferred challenging the impugned order dated 17.02.2021 passed by the High Court of Madhya Pradesh, Bench at Indore in M.P. No.107 of 2021 and M.P. No. 108 of 2021 by which the High Court has dismissed the said misc. petition preferred by the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ethods in protracting the litigation. It is not surprising that civil disputes drag on and on. The misplaced sympathy and indulgence by the appellate and revisional courts compound the malady further. The case in hand is a case of such misplaced sympathy. It is high time that courts become sensitive to delays in justice delivery system and realise that adjournments do dent the efficacy of the judicial process and if this menace is not controlled adequately, the litigant public may lose faith in the system sooner than later. The courts, particularly trial courts, must ensure that on every date of hearing, effective progress takes place in the suit. 16. No litigant has a right to abuse the procedure provided in CPC. Adjournments have grown like cancer corroding the entire body of justice delivery system. 17. A party to the suit is not at liberty to proceed with the trial at its leisure and pleasure and has no right to determine when the evidence would be let in by it or the matter should be heard. The parties to a suit whether the plaintiff or the defendant must cooperate with the court in ensuring the effective work on the date of hearing for which the matter has been fix ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nything to cripple the same or to do any act which would freeze it or make it suffer from impotency. Delayed delineation of a controversy in a court of law creates a dent in the normative dispensation of justice and in the ultimate eventuate, the Bench and the Bar gradually lose their reverence, for the sense of divinity and nobility really flows from the institutional serviceability. Therefore, historically, emphasis has been laid on individual institutionalism and collective institutionalism of an adjudicator while administering justice. It can be stated without any fear of contradiction that the collective collegiality can never be regarded as an alien concept to speedy dispensation of justice. That is the hallmark of duty, and that is the real measure. 12. The proceedings in the second appeal before the High Court, if we allow ourselves to say so, epitomises the corrosive effect that adjournments can have on a litigation and how a lis can get entangled in the tentacles of an octopus. The philosophy of justice, the role of a lawyer and the court, the obligation of a litigant and all legislative commands, the nobility of the Bench and the Bar, the ability and efficiency of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tionaries of the court or the members of the Bar significantly exhibits indolence and one can aphoristically say, borrowing a line from Southwell creeping snails have the weakest force [ Robert Southwell, Loss in Delay , in William B. Turnbull (Ed.), The Poetical Works of the Rev. Robert Southwell (John Russell Smith, London 1856), p. 60.] . Slightly more than five decades back, talking about the responsibility of the lawyers, Nizer Louis had put thus: I consider it a lawyer's task to bring calm and confidence to the distressed client. Almost everyone who comes to a law office is emotionally affected by a problem. It is only a matter of degree and of the client's inner resources to withstand the pressure. [ Nizer Louis, My Life in Court (Doubleday Co. Inc., New York 1961), p. 213] A few lines from the illustrious Justice Frankfurter is fruitful to recapitulate: I think a person who throughout his life is nothing but a practising lawyer fulfils a very great and essential function in the life of society. Think of the responsibilities on the one hand, and the satisfaction on the other, to be a lawyer in the true sense. [ Felix Frankfurter, Proceedings in Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sue the advocate for damages but that remedy would remain unaffected by the course adopted in this case. Even so, in situations like this, when the court mulcts the party with costs for the failure of his advocate to appear, we make it clear that the same court has power to permit the party to realize the costs from the advocate concerned. However, such direction can be passed only after affording an opportunity to the advocate. If he has any justifiable cause the court can certainly absolve him from such a liability. Be it noted, though the said passage was stated in the context of strike by the lawyers, yet it has its accent on nonappearance by a counsel in the court. 18. In this context, we may refer to the pronouncement in Pandurang Dattatraya Khandekar v. Bar Council of Maharashtra [(1984) 2 SCC 556 : 1984 SCC (Cri) 335] , wherein the Court observed that : (SCC p. 563, para 9) 9. An advocate stands in a loco parentis towards the litigants and it therefore follows that the client is entitled to receive disinterested, sincere and honest treatment especially where the client approaches the advocate for succor in times of need. 19. In Lt. Col. S.J. Chau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17. The role and status of lawyers at the beginning of sovereign and democratic India is accounted as extremely vital in deciding that the nation's administration was to be governed by the rule of law. The Bench emphasised on the role of eminent lawyers in the framing of the Constitution. The emphasis was also laid on the concept that lawyers are the officers of the court in the administration of justice. 22. In R.K. Garg v. State of H.P. [(1981) 3 SCC 166 : 1981 SCC (Cri) 663] , Chandrachud, C.J., speaking for the Court pertaining to the relationship between the Bench and the Bar, opined thus : (SCC p. 170, para 9) 9. the Bar and the Bench are an integral part of the same mechanism which administers justice to the people. Many members of the Bench are drawn from the Bar and their past association is a source of inspiration and pride to them. It ought to be a matter of equal pride to the Bar. It is unquestionably true that courtesy breeds courtesy and just as charity has to begin at home, courtesy must begin with the Judge. A discourteous Judge is like an ill tuned instrument in the setting of a courtroom. But members of the Bar will do well to remember t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay be defeated. The resultant effect would be that such a litigant would lose confidence in the justice delivery system and instead of filing civil suit and following the law he may adopt the other mode which has no backing of law and ultimately it affects the rule of law. Therefore, the court shall be very slow in granting adjournments and as observed hereinabove they shall not grant repeated adjournments in routine manner. Time has now come to change the work culture and get out of the adjournment culture so that confidence and trust put by the litigants in the Justice delivery system is not shaken and Rule of Law is maintained. 5.6 In view of the above and for the reasons stated above and considering the fact that in the present case ten times adjournments were given between 2015 to 2019 and twice the orders were passed granting time for cross examination as a last chance and that too at one point of time even a cost was also imposed and even thereafter also when lastly the High Court passed an order with extending the time it was specifically mentioned that no further time shall be extended and/or granted still the petitioner defendant never availed of the liberty and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gurudwara, Surya Nagar, Lucknow. 8. From the above it is quite evident that the duty has been confirmed against appellant by invoking the proviso to Section 11A (1) of the Central Excise Act,1944 and respondent has been held liable for penalty under Section 11 AC for the duty confirmed at both the premises i.e the registered premises of M/s Harsh Trader, 165, Deep nagar, RDSO, Manak Nagar Lucknow and unregistered premises at Little Care Public School, Behind RDSO, Gurudwara, Surya Nagar, Lucknow. However while imposing the penalty under Section 11 AC penalty has been imposed only in respect of the duty confirmed at the registered premises of M/s Harsh Trader, 165, Deep nagar, RDSO, Manak Nagar Lucknow 9. It is a settled law that in a case where demand has been confirmed invoking extended period of limitation penalty equivalent to duty evaded needs to be imposed and there is no discretion to any authority as held by the Hon ble Supreme Court in the case of Union of India V/s M/s Rajasthan Spinning Weaving reported as 2009 (238) E.L.T. 3 (S.C.). Relevant part of the judgment is reproduced below:- 14. Sub-section 1A of Section 11A provides that in case the person in defa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y such person under this section shall be twenty-five per cent of the duty so determined : Provided further that the benefit of reduced penalty under the first proviso shall be available if the amount of penalty so determined has also been paid within the period of thirty days referred to in that proviso : Provided also that where the duty determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, for the purpose of this section, the duty as reduced or increased, as the case may be, shall be taken into account : Provided also that in case where the duty determined to be payable is increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, the benefit of reduced penalty under the first proviso shall be available, if the amount of duty so increased, the interest payable thereon and twenty-five per cent of the consequential increase of penalty have also been paid within thirty days of the communication of the order by which such increase in the duty takes effect - Explanation. - For the removal of doubts, it is hereby declared that - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erate deception by the assessee with the intent to evade duty by adopting any of the means mentioned in the section. 20. At this stage, we need to examine the recent decision of this Court in Dharamendra Textile (supra). In almost every case relating to penalty, the decision is referred to on behalf of the Revenue as if it laid down that in every case of non-payment or short payment of duty the penalty clause would automatically get attracted and the authority had no discretion in the matter. One of us (Aftab Alam, J.) was a party to the decision in Dharamendra Textile and we see no reason to understand or read that decision in that manner. In Dharamendra Textile the court framed the issues before it, in paragraph 2 of the decision, as follows : 2. A Division Bench of this Court has referred the controversy involved in these appeals to a larger Bench doubting the correctness of the view expressed in Dilip N. Shroff v. Joint Commissioner of Income Tax, Mumbai Anr. [2007 (8) SCALE 304]. The question which arises for determination in all these appeals is whether Section 11AC of the Central Excise Act, 1944 (in short the Act ) inserted by Finance Act, 1996 with the intent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... short payment of duty regardless of the conditions expressly mentioned in the section for its application. 22. There is another very strong reason for holding that Dharamendra Textile could not have interpreted Section 11AC in the manner as suggested because in that case that was not even the stand of the revenue. In paragraph 5 of the decision the court noted the submission made on behalf of the revenue as follows : 5. Mr. Chandrashekharan, Additional Solicitor General submitted that in Rules 96ZQ and 96ZO there is no reference to any mens rea as in section 11AC where mens rea is prescribed statutorily. This is clear from the extended period of limitation permissible under Section 11A of the Act. It is in essence submitted that the penalty is for statutory offence. It is pointed out that the proviso to Section 11A deals with the time for initiation of action. Section 11AC is only a mechanism for computation and the quantum of penalty. It is stated that the consequences of fraud etc. relate to the extended period of limitation and the onus is on the revenue to establish that the extended period of limitation is applicable. Once that hurdle is crossed by the revenue, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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