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TMI Blog2025 (3) TMI 1131X X X X Extracts X X X X X X X X Extracts X X X X ..... d at the time of release of the seized goods. BRIEF FACTS: 2. On 29.04.2011, pursuant to receipt of information, the Anti-Evasion Wing of the Central Excise, Delhi-1, conducted searches and effected seizures under the Central Excise Act, 1944 (hereinafter "the Act") from the premises of the Petitioner firms and that of Mr. Parmod Kumar Jain. A panchnama of the seized goods was duly drawn. Mr. Parmod Kumar Jain was the proprietor of M/s Paras Products and M/s Sai Enterprises, and his son, Mr. Ankit Jain, was the proprietor of M/s Jaina Polymers. During search, the following materials were seized at the premises: S.No. Goods seized from the premises (M/s) Description of seized goods Seizure value (INR) Total Value (INR) 1. Petitioner in W.P.(C) 6235/2023 Finished goods 10,97,496 39,95,816 Raw Materials 8,34,300 Scrap 1,34,020 Moulds 39,95,816 2. Petitioner in W.P.(C) 6376/2023 Finished goods 9,59,900 18,47,750 Raw Materials 1,87,850 Tata 407 vehicle 7,00,000 3. Petitioner in W.P.(C) 6648/2023 Finished goods 35,760 90,510 Raw Materials 54,750 3. The Petitioner firms were engaged in the manufacturing and clearance of footwear and soles falling under C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unjab v. Bhatinda District Coop. Milk Producers Union Ltd., (2007) 11 SCC 363, Sunder System (P) Ltd. v. Union of India, 2019 SCC OnLine Del 12137 and Siddhi Vinayak Syntex (P) Ltd. v. Union of India Siddhi Vinayak Syntex (P) Ltd. v. Union of India, 2017 SCC OnLine Guj 2609. 11. In response thereto, the Respondent authorities would raise three contentions. Firstly, with the advent of the CGST Act on 01.07.2017, it had become difficult to make prompt adjudication, as the department was restructured and which led to numerous difficulties, including conducting physical verification of various registrants to avoid and prevent fraudulent activities and misuse of the new tax regime. Secondly, COVID-19 which adversely affected the smooth functioning of the department. Thirdly, the Petitioners themselves delayed the proceeding by not filing reply on time or filing belated reply and also that the Petitioners avoided joining the physical hearing. Therefore, there was no wilful delay on the part of the department regarding the adjudication process. 12. To bolster this argument, the Respondent would place reliance on the decision of the Hon'ble Supreme Court in Commissioner, GST and Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him to show cause why he should not pay the amount specified in the notice; (b) the person chargeable with duty may, before service of notice under clause (a), pay on the basis of - (i) his own ascertainment of such duty; or (ii) the duty ascertained by the Central Excise Officer, the amount of duty along with interest payable thereon under Section 11-AA. (4) Where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, by the reason of- (a) fraud; or (b) collusion; or (c) any wilful misstatement; or (d) suppression of facts; or (e) contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by any person chargeable with the duty, the Central Excise Officer shall, within five years from the relevant date, serve notice on such person requiring him to show cause why he should not pay the amount specified in the notice along with interest payable thereon under Section 11-AA and a penalty equivalent to the duty specified in the notice. (10) The Central Excise Officer shall, after allowing the concerned person an opportunity of being heard, and aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Act. ***** 20. We have chosen to extract those provisions for the sake of completeness and notwithstanding the petitioners asserting that by virtue of Section 174 (2) of the CGST Act, and which constitutes the „Repeal and Saving' clause, it would be the provisions of the 1994 Act which would govern. 21. In terms of Section 73 (1) of the CGST Act, which is principally concerned with cases other than where allegations of fraud, wilful misstatement or suppression of facts are made, and pertains to tax incorrectly computed, erroneously refunded or benefits wrongly availed, sets out terminal points within which action referable to that provision would have to be commenced and concluded. A final order on the culmination of adjudication is liable to be framed by the proper officer in terms contemplated under Section 73 (9) of the CGST Act. By virtue of sub-section (10) thereof, the proper officer is bound to frame such an order within three years from the due date for furnishing of an annual return. A notice commencing proceedings referable to Section 73 must be issued at least three months prior to the time limit as specified in sub-section (10) coming to an end. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as constricted by factors beyond its control which prevented it from moving with reasonable expedition. This principle would apply equally to cases falling either under the Customs Act, the 1994 Act or the CGST Act. 86. When we revert to the facts that obtain in this batch, we find that the respondents have clearly failed to establish the existence of an insurmountable constraint which operated and which could be acknowledged in law as impeding their power to conclude pending adjudications. In fact, and to the contrary, the frequent placement of matters in the call book, the retrieval of matters therefrom and transfer all over again not only defies logic it is also demonstrative of due application of mind quite apart from the said procedure having been found by us to be contrary to the procedure contemplated by Section 28. The respondents have, in this regard, failed to abide by the directives of the Board itself which had contemplated affected parties being placed on notice, a periodic review being undertaken and the proceedings having been lingered unnecessarily with no plausible explanation. The inaction and the state of inertia which prevailed thus leads us to the inevitable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2017. There is no plausible reason as to why the adjudication could not be done between 2011-17 and the inaction for the said period remains unexplained. 19. With respect to the allegation of giving late replies, seeking repeated adjournments or failing to cooperate in the proceedings by the assessees, this Court has already held in Vos Technologies India that in any such situation, nothing prevents the Respondent authorities from proceeding ex-parte or refusing to reject such requests if considered lacking in bona fides. COVID-19 and introduction of the CGST Act, in any event cannot condone the delay for the period before these intervening events. These appear to be excuses to seek to explain inaction by the Respondents for over 11 years. 20. So far as the Respondents' reliance upon the decision of the Hon'ble Supreme Court in M/s Swati Menthol is concerned, this Court has already pondered upon the same in Vos Technologies India. 21. In Vos Technologies India, this Court categorically held that, matters having financial liabilities or penal consequences cannot be kept unresolved for years; and the phrase "where it is possible to do so" cannot be a license to keep matters pendi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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