Court overturns order for lack of natural justice, directs reevaluation of tax liability.

The court set aside the impugned order for violating the principles of natural justice by not granting a proper opportunity for a personal hearing as mandated by Section 33-A(1) and (2) of the Central Excise Act, 1944. The writ petition was allowed without costs, directing the petitioner to deposit 2.5% of the tax liability demanded and present all documentary evidence to the second respondent for a reevaluation in accordance with the law. The judgment stressed the importance of adhering to procedural requirements to uphold natural justice in adjudication proceedings under the Act.

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Issues:
Challenge to order of the 2nd respondent regarding violation of principles of natural justice and mandatory procedure under Section 33-A(1) and (2) of the Central Excise Act, 1944.

Analysis:
The Writ Petitioner challenged the final order dated 26.12.2014 passed by the 2nd respondent, alleging a lack of opportunity for a hearing as required by Section 33-A(1) and (2) of the Act. The petitioner argued that the impugned order violated the principles of natural justice by not granting sufficient time for a personal hearing, which is mandatory under the Act. On the other hand, the Additional Government Pleader contended that the petitioner had been given adequate opportunity to defend the proceedings, and the Act only requires affording an opportunity to the assessee without mandating specific conditions for the adjudicating authority.

Upon reviewing the provisions of Section 33-A(1) and (2) of the Act, it was found that the petitioner had submitted detailed explanations and requested a personal hearing after producing documents. The second respondent initially called for an enquiry on specific dates, to which the petitioner responded by requesting a hearing after 15th January 2015 due to their legal team's unavailability. However, the second respondent proceeded to pass the final order on 26.12.2014 without considering the petitioner's request, thereby failing to adhere to the mandatory requirement of granting an opportunity of hearing as per the Act. Consequently, the impugned order was set aside, and the writ petition was allowed without costs.

The court directed the petitioner to deposit 2.5% of the tax liability demanded by the respondents within four weeks and appear before the second respondent on 20.04.2015 to present all documentary evidence in support of their claim. The second respondent was instructed to consider the evidence and pass an order on merits and in accordance with the law. The judgment emphasized the importance of following procedural requirements to ensure the principles of natural justice are upheld in adjudication proceedings under the Central Excise Act, 1944.

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