2025 (5) TMI 1932 - AT - Customs

Procedural Fairness Prevails: CESTAT Upholds Rule 41, Balances Judicial Discipline with Reasonable Submission Timelines

M/s EURO ASIA GLOBAL THROUGH PROPRIETOR Versus COMMISSIONER OF CUSTOMS, ICD, TKD NEW DELHI

The SC addressed procedural challenges under Rule 41 of CESTAT Procedure Rules. The Tribunal refused to recall its 3.3.2025 order, finding that granting ... Miscellaneous applications under Rule 41 of the CESTAT Procedure Rules, 1985 - jurisdiction of the officer issuing the SCN - HELD THAT:- We have considered the entire history of adjournments including the two warnings of last opportunity given and the assurance given by the learned counsel on 14.1.2025 that the matter would be argued on 3.3.2025. We do not find any error or mistake on our part in hearing the matter on 3.3.2025 per order dated 14.01.2025 and reserving the matter for orders. It is especially so, since we had given two weeks time to both sides to give any written submissions. This was done with the intention that nothing which either side may submit should miss our consideration when passing the final order. In our considered view, that would meet the ends of justice. We find Rule 41 empowers the Tribunal to issue orders and directions to give effect to or in relation to its orders. Our order on 3.3.2025 gives effect to the orders dated 19.11.2024 and 14.1.2025. It would prevent abuse of the process. Giving further time to give any written submissions also secured the ends of justice. We, therefore, find no reason to recall our order dated 3.3.2025. We, however, modify it by giving two weeks time to both sides from today to give any written submissions. The Miscellaneous applications are rejected. The core legal questions considered by the Tribunal in these proceedings revolve around the propriety and exercise of its procedural powers under Rule 41 of the CESTAT Procedure Rules, 1985. Specifically, the issues include:Whether the Tribunal's order dated 3.3.2025, which reserved the appeals for orders and granted liberty to submit written submissions within two weeks, should be recalled to allow the appellants an opportunity to appear and make oral submissions.The extent and limits of the Tribunal's discretion under Rule 41 to recall or modify its orders to prevent abuse of process and secure the ends of justice.The impact of repeated adjournments sought by the appellants and the Tribunal's prior explicit orders denying further adjournments on the right to be heard and fair procedure.The appropriateness of the Tribunal hearing the appeals on 3.3.2025 despite the absence of the appellants' counsel and the adequacy of the opportunity provided to the parties to make submissions.Issue-wise Detailed Analysis1. Whether the order dated 3.3.2025 should be recalled to permit the appellants to appear and make oral submissionsThe relevant legal framework is Rule 41 of the CESTAT Procedure Rules, 1985, which empowers the Tribunal to make orders or give directions necessary to give effect to its orders, prevent abuse of process, or secure ends of justice. Precedents emphasize that procedural orders should balance the right to be heard with the need to avoid undue delay and abuse of the judicial process.The appellants contended that their counsel was unable to appear on 3.3.2025 due to being out of station and that the proxy counsel's request for adjournment was refused. They argued that they have a prima facie good case on merits and require the opportunity to make oral submissions, which they could not do previously.The Tribunal noted the appellants' submissions but found that the order dated 3.3.2025 merely reserved the appeals for orders and granted both parties two weeks to submit written submissions. The Tribunal reasoned that this procedure sufficiently secured the appellants' right to be heard and that recalling the order was unnecessary.In applying the law to the facts, the Tribunal observed that the appellants had been given multiple opportunities to appear and argue the matter, including explicit warnings that no further adjournments would be granted. The appellants' counsel had assured the Tribunal on 14.1.2025 that the matter would be argued on 3.3.2025 but failed to appear on that date.The Tribunal treated the competing arguments by weighing the appellants' right to be heard against the need to prevent abuse of process and undue delay. It concluded that allowing further adjournment or recalling the order would undermine procedural discipline and delay finality.The conclusion was that the order dated 3.3.2025 should not be recalled, but the Tribunal would extend the time for written submissions to ensure the appellants' case was fully considered.2. The scope of Rule 41 of the CESTAT Procedure Rules in relation to recalling or modifying ordersRule 41 enables the Tribunal to issue orders or directions to give effect to its orders, prevent abuse of process, and secure ends of justice. The Tribunal's interpretation emphasized that this rule is not a tool to circumvent prior explicit orders or to facilitate repeated adjournments without sufficient cause.The Tribunal reasoned that its order of 3.3.2025 was consistent with prior directions issued on 19.11.2024 and 14.1.2025, which had expressly limited adjournments. The order to reserve the appeals and allow written submissions was an exercise of Rule 41 to give effect to these directions, prevent abuse of process, and secure justice by ensuring all relevant submissions were considered.The Tribunal found no error in its exercise of discretion under Rule 41 and no basis to recall or modify the order beyond extending the time for written submissions.3. The effect of repeated adjournments and prior explicit orders denying further adjournments on procedural fairnessThe Tribunal highlighted the procedural history, noting that the appeals pertain to matters from 2011 and have been pending for a long time. On 19.11.2024, the Tribunal explicitly ordered that no further adjournments would be granted. Despite this, the appellants sought and obtained an adjournment on 14.1.2025, with the assurance that the matter would be argued on 3.3.2025.On 3.3.2025, the appellants' counsel failed to appear, and the Tribunal refused further adjournment, proceeding to hear and reserve the matter. The Tribunal underscored that these warnings and assurances were given in open court and that the appellants' conduct was inconsistent with procedural discipline.The Tribunal balanced the appellants' right to be heard with the need to prevent abuse of process, emphasizing that procedural fairness does not justify indefinite delays or disregard of court orders.4. Adequacy of the opportunity provided to the parties to make submissionsThe Tribunal noted that although the appellants' counsel was absent on 3.3.2025, both parties were granted two weeks' time to file written submissions. This was intended to ensure that no relevant arguments or evidence would be excluded from consideration before the final order.The Tribunal found this procedure adequate to meet the ends of justice and to compensate for the absence of oral submissions on that date. It further extended the time for written submissions by two weeks in the final order, reinforcing the commitment to a fair adjudication.Significant Holdings'Rule 41 of the CESTAT Procedure Rules, empowers the Tribunal to give directions to (a) give effect to or in relation to its orders; (b) to prevent abuse of its process; and (c) secure ends of justice.''We do not find any error or mistake on our part in hearing the matter on 3.3.2025 per order dated 14.01.2025 and reserving the matter for orders. It is especially so, since we had given two weeks time to both sides to give any written submissions. This was done with the intention that nothing which either side may submit should miss our consideration when passing the final order. In our considered view, that would meet the ends of justice.''We find no reason to recall our order dated 3.3.2025. We, however, modify it by giving two weeks time to both sides from today to give any written submissions.'The Tribunal established the core principle that procedural orders aimed at preventing abuse of process and securing justice must be balanced against the right to be heard, but repeated adjournments and failure to comply with explicit court directions cannot be condoned.On the key issue of recalling the order dated 3.3.2025, the Tribunal concluded that the order should stand, with a modification to extend the time for written submissions, thereby ensuring fairness without compromising procedural discipline.