Relaxation power for past non-declaration defaults was upheld, with retrospectivity objection rejected.

The relaxation power under Notification No. 5/81-C.E. was treated as capable of being exercised to condone earlier non-declaration defaults under para 1 of Notification No. 201/79-C.E., because condonation of an existing lapse is a present exercise of authority over past events and is not retrospective merely because the default pre-dated the later notification. The retrospectivity objection was rejected, and the authority was held competent to consider non-declaration defaults occurring before 21-1-1981; the impugned order was set aside and the application was directed to be reheard.

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Issues: Whether the power of relaxation under Notification No. 5/81-C.E. could be applied to condone non-declaration under para 1 of Notification No. 201/79-C.E. for a period before 21-1-1981, and whether such application involved impermissible retrospectivity.

Analysis: The relevant question was whether exercising the relaxation power amounted to giving retrospective effect to the later notification. The reasoning proceeded on the basis that condonation of an existing lapse is an exercise of a present power in relation to past events, and does not become retrospective merely because the default occurred before the notification came into force. The power to absolve a remissness was treated as capable of being exercised whenever the authority possesses that power, including for past non-declaration defaults.

Conclusion: The objection based on retrospectivity was rejected. The authority was held to have power under Notification No. 5/81-C.E. to consider non-declaration defaults occurring before 21-1-1981, and the impugned order was set aside with a direction to rehear the application.

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