2013 (12) TMI 287 - HC - Central Excise

Court sets aside order, remands matter for decision, stresses importance of Commissioners' due diligence

The Court allowed the Central Excise Appeal, setting aside the previous order and remanding the matter back to the tribunal for a decision on merits. The ... Scope of Section 35-B (2) of the Central Excise Act – Appeal could be dismissed or not – Filing of counter Affidavit – Held that:- The opinion of the Board of Commissioner of the Central Excise under Section 35B is not justiceable on merits in Court - The opinion to be formed by the Board of Commissioners is a prima facie opinion and is not conclusive in nature which may be subject to challenge by the assessee on merits - If such an order is subjected to judicial review, it may give rise to taking ground to be agitated in almost every case and will cause unnecessary delay in disposal of the appeals under Section 35B of the Act - the object and purpose of enacting Section 35-B (2) of the Act is to avoid filing of frivolous and unnecessarily appeals, and to safeguard the interest of the revenue. Relying upon Collector Vs. of Central Excise, Vadodara Vs. Rohit Pulp Paper Mills [1998 (4) TMI 138 - SUPREME COURT OF INDIA] - The record clearly demonstrates that the Committee of Commissioners have signed on the note, which contains the reasons, and the proposed order giving grounds on which the appeal has to be filed - the Committee of Commissioners have applied their mind before authorizing to file the appeal - Granting time to the respondent to file a counter affidavit, especially when we perused the original records cannot be allowed – Decided in favour of Appellant. Issues:1. Condonation of delay in filing the appeal.2. Validity of the orders passed by the Committee of Commissioners.3. Application of mind by the Committee of Commissioners.4. Interpretation of Section 35-B (2) of the Central Excise Act.5. Judicial review of the opinion formed by the Board of Commissioners under Section 35B.Analysis:1. The Court considered the delay in filing the appeal and accepted the cause shown for condonation of delay, allowing the application for condonation of delay due to good and sufficient reasons.2. The appellant argued that the orders passed by the Committee of Commissioners could not be questioned as the note placed before them contained the necessary information and grounds for challenging the order. The Court directed the appellant to produce the record of the approval given by the Committee of Commissioners under Section 35-B (2) of the Central Excise Act.3. Upon examining the records produced by the appellant, the Court found that the Committee of Commissioners had applied their minds to the facts of the case and the grounds for filing the appeal under Section 35-B(2) of the Central Excise Act. The Court noted that the Commissioners had signed the proposed order after considering the reasons for filing the appeal.4. The Court interpreted Section 35-B (2) of the Act, emphasizing that its purpose is to prevent the filing of frivolous appeals and to protect the revenue's interest. The Committee of Commissioners is authorized to form an opinion on the necessity of filing an appeal based on the legal and proper nature of the order under Section 35 or 35A.5. The Court highlighted that the opinion formed by the Board of Commissioners under Section 35B is not justiciable on merits in court, as it is a prima facie opinion aimed at preventing unnecessary delays in disposing of appeals. The Court emphasized that challenging such an opinion on merits would lead to delays and hinder the purpose of Section 35-B (2) in avoiding frivolous appeals.In conclusion, the Court allowed the Central Excise Appeal, setting aside the previous order and remanding the matter back to the tribunal for a decision on merits. The judgment underscores the importance of the Committee of Commissioners applying their minds before authorizing the filing of appeals to prevent frivolous litigation and protect the revenue's interest.