2016 (9) TMI 423 - AT - Central Excise

Commissioner must give appeal directions to same adjudicating authority under Central Excise Act.

The Tribunal concluded that directions to file an appeal must be given by the Commissioner only to the same adjudicating authority, as mandated by Section ... Whether in terms of the provisions of Section 35 E(2) of the Central Excise Act, 1944, directions to file the appeal are required to be given by the Commissioner only to the very same authority, who adjudicated the case or the same can be given to any other authority - Held that:- The Hon'ble High Court of Delhi in the case of C.C.E. vs. Maza Cosmetics [2006 (8) TMI 65 - HIGH COURT , DELHI] ruled that the Commissioner can direct 'the adjudicating authority' to file appeal and in turn, the adjudicating authority can direct any officer to file appeal before Commissioner (Appeals). The ratio of decision of the Hon'ble High Court, which is directly on the point is applicable on all fours and needs to be followed as no contrary decision of any High Court on the provision of Section 35E(2) was brought to our notice. The very same question as is posed to Larger Bench was considered by the Hon'ble High Court of Bombay in the case of Silver Streak Welding Products India Pvt. Ltd. [2007 (9) TMI 222 - HIGH COURT BOMBAY]. Also the decision of the Apex Court in the case of MM. Rubber Co. [1991 (9) TMI 71 - SUPREME COURT OF INDIA] supports the view taken by the Hon'ble High Courts of Bombay and Delhi. Therefore, by following the decision of the Hon'ble High Court of Bombay and Delhi, we hold that the directions to file appeal are required to be given by the Commissioner only to the very same adjudicating authority is the mandate of the Section 35E(2) of the Act. - Decided against the Revenue Issues:Interpretation of Section 35E(2) of the Central Excise Act, 1944 - Whether directions to file an appeal are required to be given by the Commissioner only to the same authority who adjudicated the case or can be given to any other authority.Analysis:Issue 1: Interpretation of Section 35E(2) of the Central Excise Act, 1944The Tribunal referred the question of law to the Larger Bench regarding the interpretation of Section 35E(2) of the Central Excise Act, 1944. The Revenue argued that the provisions of Section 35E(2) confer a substantive right to file an appeal to the first appellate authority, emphasizing that the language used in the section should be read in conjunction with Section 35E(4). They cited various Tribunal and High Court decisions to support their argument that the Commissioner can direct any authority to file an appeal before a higher authority. On the other hand, the respondent contended that previous High Court decisions, such as the Bombay High Court and the Delhi High Court, have interpreted the provisions differently, emphasizing the need for the Commissioner to direct the adjudicating authority specifically to file the appeal.Issue 2: Precedents and InterpretationThe Tribunal examined the provisions of Section 35E(2) of the Act, which empower the Commissioner to call for and examine the record of any proceeding where an adjudicating authority subordinate to him has passed a decision. The Tribunal referred to the judgment of the Bombay High Court in a specific case where it was held that the power to file an appeal could only be conferred on the adjudicating officer. Similarly, the Delhi High Court emphasized that the provisions of Section 35E(2) and Section 35E(4) cater to different stages in the process of filing an appeal. The High Courts ruled that the Commissioner can direct the adjudicating authority to file an appeal, and subsequently, the adjudicating authority can direct any officer to file the appeal before the Commissioner (Appeals).Issue 3: Application of PrecedentsThe Tribunal acknowledged the rulings of the High Courts of Bombay and Delhi regarding the interpretation of Section 35E(2). They noted that no contrary decision from any High Court was brought to their attention. The Tribunal found merit in the argument that the Commissioner can direct the adjudicating authority to file an appeal, as supported by the decisions of the High Courts. The Tribunal also distinguished the cases cited by the Revenue, noting that they pertained to a different section of the Act and did not directly apply to the interpretation of Section 35E(2).Conclusion:After thorough consideration of the arguments and precedents, the Tribunal concluded that directions to file an appeal must be given by the Commissioner only to the same adjudicating authority, as mandated by Section 35E(2) of the Act. The Tribunal directed the registry to place the files before the regular Bench for further action.This comprehensive analysis of the judgment provides a detailed overview of the issues involved, the arguments presented by both parties, the interpretation of relevant legal provisions, and the application of precedents leading to the Tribunal's final decision.