Territorial jurisdiction in central excise proceedings waived by participation and failure to object before adjudication

Territorial jurisdiction of the Collector of Central Excise, Calcutta-I was challenged because the factories were outside his area and no notification under the Central Excise Rules, 1944 had been issued. The majority held that the proceedings stemmed from a common investigation, with seized documents at the head office within Calcutta-I and goods seized from units in West Bengal, so the objection was only to territorial competence and was waived because it was not raised before the adjudicating authority and the appellants participated in the proceedings. The absence of a specific notification was held not to invalidate the adjudication on the facts. The dissent took the opposite view on territorial power and consent.

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Issues: Whether the Collector of Central Excise, Calcutta-I had jurisdiction to issue the show cause notice and adjudicate the proceedings when the appellants' factories were located outside his territorial jurisdiction and no notification had been issued under the Central Excise Rules, 1944.

Analysis: The majority held that the proceedings arose from a common investigation involving multiple assessees, with incriminating documents seized from the head office within Calcutta-I and goods seized from units within West Bengal. The objection raised was one of territorial jurisdiction only, not of the Collector's overall competence, and such objection had not been taken before the adjudicating authority. It was further held that territorial objections can be waived, that participation in the proceedings amounted to consent, and that the absence of a specific notification did not invalidate the adjudication in the facts of the case. The dissenting view held that the Commissioner lacked territorial power and that jurisdiction could not be conferred by consent or by the Chief Commissioner.

Conclusion: The majority answered the jurisdiction issue in favour of the assessee, holding that the adjudication by Collector of Central Excise, Calcutta-I could not be sustained on the pleaded jurisdictional objection and that the appeals were to be allowed.

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