2016 (10) TMI 757 - AT - Central Excise

Tribunal rejects rectification application under Central Excise Act

The Tribunal dismissed the rectification of mistake application under Section 35C(2) of the Central Excise Act, 1944, finding that the grounds raised ... Rectification of mistake under Section 35C(2) of the Central Excise Act, 1944 - error apparent on the face of the record - review of merits not permissible in a review/rectification application - sub judice / pending appeal before a higher forum as a bar to rectification - misuse of process of the Tribunal - principles of natural justice (audi alteram partem)Rectification of mistake under Section 35C(2) of the Central Excise Act, 1944 - error apparent on the face of the record - review of merits not permissible in a review/rectification application - sub judice / pending appeal before a higher forum as a bar to rectification - misuse of process of the Tribunal - Whether the application under Section 35C(2) seeking rectification of mistake in the Tribunal's final order of 05.08.2015 discloses an error apparent on the face of the record entitling the applicants to relief. - HELD THAT: - The Tribunal examined the ROM application and the grounds advanced, including the contention that penalties arising from subsequent show-cause notices ought to have been deleted and that a finding on applicability of an explanation to Section 3(1) violated principles of natural justice. The Tribunal found that the grounds pressed in the ROM primarily sought re-consideration of the merits of the decision rather than pointing to any patent error apparent on the face of the record. It noted that the identical grounds advanced in the ROM were already included in an appeal lodged by the applicants before the Hon'ble High Court, which was filed prior to the ROM and is sub judice. In these circumstances the Tribunal held that the applicants were attempting to use the ROM procedure to revisit merits and to continue litigation on issues already before a higher forum, thereby constituting an abuse or misuse of the Tribunal's process. Consequently the application did not satisfy the statutory test for rectification under Section 35C(2) and disclosure of an error apparent on the face of the record was not established.ROM application dismissed for lack of error apparent on the face of the record and as impermissibly seeking merits review while identical grounds are sub judice before the High Court.Final Conclusion: The application under Section 35C(2) for rectification of the Tribunal's order dated 05.08.2015 is dismissed as devoid of merit, the pleaded grounds amounting to a merits review and being barred by the pendency of an earlier-filed appeal before the Hon'ble High Court. Issues:Rectification of Mistake under Section 35C(2) of the Central Excise Act, 1944 regarding imposition of penalty, violation of principles of natural justice, ignorance of notification 89/82-Cus dated 25.03.1982.Analysis:The applicants filed an application under Section 35C(2) seeking rectification of mistake in the final order dated 05.08.2015, claiming that the Tribunal did not address the imposition of penalty despite detailed arguments presented. They contended that subsequent show-cause notices did not allege suppression, thus the penalty imposed under those notices should be deleted. The applicants argued that the Tribunal's finding on the applicability of an explanation to Section 3(1) of the Act violated principles of natural justice as they were not given an opportunity to argue on this point. Additionally, they highlighted the Tribunal's alleged ignorance of notification 89/82-Cus dated 25.03.1982, which they claimed was already part of the record.The Respondent vehemently opposed the rectification of mistake application, arguing that the grounds presented did not meet the conditions outlined in Section 35C(2) and that the applicants were attempting to review the entire case on its merits under the guise of rectification. The Respondent pointed out that the applicants had already appealed the Tribunal's decision to the High Court, including the grounds raised in the rectification application, rendering the matter sub judice. The Respondent further criticized the timing of the rectification application, filed five months after the case's disposal, as an abuse of the court's process.After hearing both parties and reviewing the records, the Tribunal noted that the grounds for rectification were essentially delving into the merits of the case, which was inappropriate for a rectification application. The Tribunal highlighted that the issues raised in the rectification application had already been included in the appeal before the High Court, making the rectification redundant. Consequently, the Tribunal found no error apparent on the face of the records and dismissed the rectification application for lacking merit. The Tribunal emphasized that the rectification application was filed after the matter had been taken to the High Court, indicating an unjustified attempt to re-litigate the case.In conclusion, the Tribunal dismissed the rectification of mistake application, stating that it was devoid of merit and emphasizing that the issues raised were already under consideration in the appeal before the High Court. The decision was pronounced in court on 19/02/2019.