2012 (12) TMI 466 - AT - Central Excise

Tribunal accepts appeals, orders Commissioner to comply with High Court directive

The appeals were accepted as the Tribunal found that the Commissioner's actions violated the undertaking given to the High Court by signing the order ... Violation of court undertaking - stay of proceedings - signing as essential formality for operative order - supply of relied upon documents - principles of natural justice - de novo adjudication - opportunity to cross-examine witnessesViolation of court undertaking - stay of proceedings - signing as essential formality for operative order - Impugned adjudication order was passed in violation of the stay/undertaking given before the High Court and is therefore not sustainable. - HELD THAT: - The Department, through its counsel, accepted notice before the High Court and undertook that the adjudication proceedings would not be proceeded with until the next date (1-11-2001 order). The Commissioner signed the adjudication order on 7-11-2001, during the operation of that undertaking. The departmental contention that the order came into existence earlier when a draft was approved in the administrative file (30-10-2001) was rejected: an order becomes operative only when signed by the authority concerned. Since the signing occurred on 7-11-2001 while the stay/undertaking was in force, the order was passed in contravention of the undertaking/stay and cannot be sustained. [Paras 6]Impugned order held to have been passed in violation of the undertaking/stay and thus unsustainable.Supply of relied upon documents - principles of natural justice - de novo adjudication - opportunity to cross-examine witnesses - Failure to supply copies of relied upon documents violated principles of natural justice and warranted remand for de novo adjudication with directions to supply documents and permit cross-examination. - HELD THAT: - The High Court ultimately directed supply of the relied upon documents in the writ petition. The adjudicating authority did not supply those documents before passing the order, which prevented the appellant from properly defending the show cause notice and resulted in failure of justice. In consequence, the Tribunal directed that the matter be remanded for fresh adjudication, with the Commissioner to supply the relied upon documents in accordance with the High Court's direction and to afford the appellant an opportunity to cross-examine relevant witnesses, subject to their availability. [Paras 7]Matter remanded for de novo adjudication with directions to supply copies of relied upon documents and to afford opportunity for cross-examination.Final Conclusion: Appeals allowed; impugned adjudication order set aside for having been passed in breach of the High Court undertaking and for failure to supply relied upon documents, and matter remanded for de novo adjudication with directions to furnish relied upon documents and permit cross-examination. Issues:Appeal against duty demand, penalty, and violation of stay order.Analysis:The appeal was filed against an order confirming a duty demand, penalty, and violation of a stay order. The appellants sought waiver of the pre-deposit condition during the argument on stay applications. The appellant's counsel argued that the order was passed in contravention of a stay order by the High Court of Rajasthan, making it legally unsustainable. The counsel contended that the Commissioner failed to supply all relied upon documents despite requests, leading to a writ petition and subsequent stay order by the High Court. The Commissioner proceeded with the adjudication order without supplying the documents, violating the stay order and principles of natural justice. The appellant requested a remand for de novo adjudication after compliance with the High Court's direction and the opportunity to cross-examine relevant witnesses.The respondent's counsel supported the impugned order, citing that it was passed before the stay order and that the High Court's final order did not direct the supply of documents. The respondent argued that the signing of the order was a formality and pressed for the dismissal of the appeals. However, the Tribunal found that the Commissioner's actions violated the undertaking given to the High Court, as the order was signed during the stay order period. The Tribunal rejected the respondent's argument that the order came into existence before the signing date, emphasizing that an order must be signed to be executable. Due to the violation of the undertaking and failure to supply relied upon documents, the Tribunal concluded that the impugned order could not be sustained. Therefore, the appeals were accepted, and the matters were remanded back to the Commissioner for de novo adjudication, with a directive to supply the documents as per the High Court's order and allow the appellant to cross-examine witnesses.