Appeals are for correction, not reconstruction

Recently, the Hon’ble Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai has, while analysing raising of additional grounds on a question of law before the Hon’ble Tribunal, made an elaborate commentary on admission of additional evidence and grounds before the Tribunal. In the case of M/s. Avanti Feeds Limited Versus Commissioner of Customs (Import), Chennai - 2025 (8) TMI 818 - CESTAT CHENNAI, the judgement upheld the rule that the appellate process does not provide an opportunity to fill in the blanks or re-argue a case by presenting new evidence that were either overlooked or purposefully excluded during the initial proceedings. The Tribunals observations highlight how unusual it is to allow extra evidence, especially in tax and quasi-judicial proceedings.

The Tribunal noted that an application for additional evidence is not allowed when: -

“6.1……(i) The general principle is that the Appellate Court should not travel outside the record of the lower court and cannot take any evidence in appeal. However, the Appellate Court can take additional evidence in exceptional circumstances.

(ii) The parties are not entitled, as of right, to the admission of such evidence. 

(iii) The admission of additional evidence does not apply, when on the basis of evidence on record, the Appellate Court can pronounce a satisfactory judgment. 

(iv) 7 The matter is entirely within the discretion of the court and is to be used sparingly. Such a discretion is only a judicial discretion circumscribed by the limitation specified in the rule itself. 

(v) Where a party on whom the onus of proving a certain point lies fails to discharge the onus, he is not entitled to a fresh opportunity to produce evidence, as the Court can, in such a case, pronounce judgment against him and does not require any additional evidence to enable it to pronounce judgment. 

(vi)  It does not entitle the appellate Court to let in fresh evidence only for the purpose of pronouncing judgment in a particular way. In other words, it is only for removing a lacuna in the evidence that the appellate Court is empowered to admit additional evidence. 

(vii)  It is not the business of the Appellate Court to supplement the evidence adduced by one party or the other in the lower Court. So a party who had ample opportunity to produce certain evidence in the lower court but failed to do so or elected not to do so, cannot have it admitted in appeal. 

(viii) The inadvertence of the party or his inability to understand the legal issues involved or the wrong advice of a pleader or the negligence of a pleader or that the party did not realise the importance of a document does not constitute a 'substantial cause'. The mere fact that certain evidence is important, is not in itself a sufficient ground for admitting that evidence in appeal.

(ix)  no reasonable care or due diligence was shown in presenting the evidence at the Original forum. 

(x) the evidence would introduce a new cause of action which completely alters the appeal and would aid the appellant to establish a new case in an appeal, which seeks to take away a vested right of limitation or any other valuable right accrued to the other party. This could then lead to unending legal disputes.

(xi) no compelling reason or substantial cause has been shown to permit the additional evidence 

(xii) the additional evidence seeks to fill in gaps or restore weak areas in the case.

(xiii) the rival party has not been given an opportunity to rebut it.

(xiv) the additional evidence is not of an unimpeachable character.”

It is evident on perusal of the above that the admission of additional evidence at the Appellate stage is only permitted in extremely rare situations where it is necessary to avoid a miscarriage of justice. The primary purpose of Appellate forums is to review decisions based on the pleadings made in appeal memorandum or cross objections; they cannot re-litigate or address strategic mistakes, carelessness, or omissions made by parties during the initial proceedings. The judicial discretion to admit more evidence is to be used cautiously and within clearly defined legal parameters.

The said legal position continues in the GST regime as well. One can draw reference of the powers of the CESTAT & GSTAT which are quite similar on this point. Before both the tribunes parties cannot present additional evidence unless the Tribunal deems it necessary. If the Tribunal is of the opinion that any document, witness, or affidavit is needed to make a decision, it can be made it admissible. Additionally, if the case was decided without giving a party enough chance to present evidence, the Tribunal may allow additional evidence to be submitted.

It is a reminder to litigants and practitioners to make a strong case during the adjudication process by presenting all the evidence and by raising all the grounds.  Since there is very little chance of introducing new evidence and grounds later, litigants must ensure that their grounds, evidence, documents, and arguments are thorough and accurately presented before the original authority.

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Mr. Kamal Aggarwal.

Co-Author : Ms. Aditi Vishnoi