AI Drafter 
TaxTMI 
TaxTMI 
2014 (12) TMI 269
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....msp;Chapter-XV of the Customs Act which deals with the appeals contains Sections 128 to 131A providing the right of an appeal and the procedure and powers incidental thereto. Section 128 of the said Act creates a right on any person aggrieved by a decision or order passed under the said Act by an officer of the Customs lower in rank than the Commissioner of Customs to the Commissioner (Appeals). Section 128A of the said Act is a procedural provision regulating the said appeal filed before the Commissioner (Appeals). Section 129 relates to the constitution of the Appellate Tribunal to be called the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) by the Central Government and the constituents thereof. Section 129A provides for an appeal to the Appellate Tribunal against the decision of an order passed by the Commissioner of Customs as an adjudicating authority; order passed by the Commissioner Appeals; order passed by the Board or the Appellate Commissioner of Customs before the appointed date and an order passed by the Board or the Commissioner of Customs either before or after the appointed date. The said provision put a fetter in deciding an appeal against an order pas....
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....n appeal, if not defined, the order can be assailed in a writ jurisdiction under Article 226 of the Constitution of India. In support of the aforesaid contentions, the petitioner placed reliance upon an unreported judgment of this Court in case of M/s Kamala Metachem & Ors. v. Commissioner of Customs (Port), Kolkata & Ors. (WP No. 919 of 2006 decided on 25-4-2007) and another unreported judgment of the Division Bench in case of M/s Lumno Industries Ltd. v. Commissioner of Central Excise, Haldia Commissionerate (CEXA No. 9 of 2013 decided on July 3, 2013) [since reported in 2014 (304) E.L.T. 533 (Cal.)], a Division Bench judgment of the Delhi High Court in Union of India v. Classic Credit Ltd., reported in 2009 (236) E.L.T. 12 (Delhi) = 2009 (13) S.T.R. 598 (Del.). 5. In case of M/s Kamala Metachem (supra), the co-ordinate bench was dealing the identical matter where an order disposing of an application for dispensation of the pre-deposit of the duty and interest was involved. The Court has not ruled that an order passed under Section 129E of the said Act is not amenable to be challenged in an appeal under Section 130 of the said Act but held that the appeal to the High Cour....
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....he purview of Article 226 of the Constitution of India." 7. The proposition of law that even an order passed under Section 129E of the said Act is amenable to an appeal before the High Court under Section 130 of the said Act lend support from the Division Bench judgment of this Court in case of Ambika Nahar Exports (supra) wherein it is held that the order disposing or refusing to dispense the deposit of a duty and interest is not an exceptional order so as to bring out of the purview of Section 130 of the said Act in these words : "9. From a plain reading of the aforesaid two provisions of the Act, we find that an order dispensing with the deposit of the amount or refusing to do so, does not come within the exceptions mentioned in Section 130 of the Act and, therefore, any order either exercising discretion in favour of the appellant or against the appellant in the matter of deposit of the amount can be successfully challenged by way of an appeal under Section 130 of the Act provided substantial question of law is involved in such appeal." 8. The inescapable conclusion which could be arrived from the above noted decision is that the order passed under Secti....
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....y arguable, where there is room for difference of opinion on it or where the Court thought it necessary to deal with that question at some length and discuss alternative views, then the question would be a substantial question of law. On the other hand, if the question was practically covered by the decision of the highest court or if the general principles to be applied in determining the question are well settled and the only question was of applying those principles to the particular facts of the case it would not be a substantial question of law and laid down the following test as proper test, for determining whether a question of law raised in the case is substantial (page 1318) : "The proper test for determining whether a question of law raised in the case is substantial would, in our opinion, be whether it is of general public importance or whether it directly and substantially affects the rights of the parties and if so whether it is either an open question in the sense that it is not finally settled by this Court or by the Privy Council or by the Federal Court or is not free from difficulty or calls for discussion of alternative views. If the question is settled by the ....
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....e Tribunal if the High Court is satisfied that the case involves a substantial question of law held that the finding of fact may also raise a substantial question of law if it is based on no evidence, non-consideration of relevant admissible evidence, drawing of wrong inferences on a proven facts and against the well-settled proposition of law in these words : "22. In Hero Vinoth v. Seshammal, this Court has observed that : (SCC p. 556, para 24) "(iii) The general rule is that the High Court will not interfere with the concurrent findings of the courts below. But it is not an absolute rule. Some of the well-recognised exceptions are where (i) the courts below have ignored material evidence or acted on no evidence; (ii) the courts have drawn wrong inferences from proved facts by applying the law erroneously; or (iii) the courts have wrongly cast the burden of proof. When we refer to 'decision based on no evidence', it not only refers to cases where there is a total dearth of evidence, but also refers to any case, where the evidence, taken as a whole, is not reasonably capable of supporting the finding." 23. A finding of fact may give rise to a substantial que....
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....med herein above is an affirmative with the rider that it must involve the substantial question of law. 13. In the realm of public law, the High Court exercises the power of judicial review against the illegality, irrationality and procedural impropriety of an order passed by the State or the statutory authorities and does not act as an appellate authority. Under Article 226 of the Constitution, High Court not only protects the fundamental right of the citizen but also the other legal right from injustice wherever it is found. The exercise of power under Article 226 cannot be restricted and is an essential part of the rule of law and have been expressly entrusted as sentinel in qui vive. 14. In case of L. Chandra Kumar v. Union of India & Ors., reported in (1997) 3 SCC 261 = 1997 (92) E.L.T. 318 (S.C.) the constitutional bench of the Supreme Court held that the power of judicial review under Article 226 of the Constitution is one of the basic features therein and any impositions and/or restrictions would amount to alteration of the basic structure which is not permissible. The power of judicial review shall be refused to be exercised when the person has the alternat....
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.... without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field. 16. Rashid Ahmed v. Municipal Board, Kairana laid down that existence of an adequate legal remedy was a factor to be taken into consideration in the matter of granting writs. This was followed by another Rashid case, namely, K.S. Rashid & Son v. Income Tax Investigation Commission which reiterated the above proposition and held that where alternative remedy existed, it would be a sound exercise of discretion to refuse to interfere in a petition under Article 226. This proposition was, however, qualified by the significant words, "unless there are good grounds therefor", which indicated that alternative remedy would not operate as an absolute bar and that writ petition under Article 226 could still be entertained in exceptional circumstances. 17. A specific and clear rule was laid down in State of U.P. v Mohd Nooh as under : "But this rule requiring the exhaustion of statutory remedies before the....
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....that law as to the jurisdiction of the High Court in entertaining a writ petition under Article 226 of the Constitution, in spite of the alternative statutory remedies, is not affected, specially in a case where the authority against whom the writ is filed is shown to have had no jurisdiction or had purported to usurp jurisdiction without any legal foundation." 16. It In a most recent judgment rendered in case of Union of India & Another v. Guwahati Carbon Ltd., reported in (2012) 11 SCC 651 = 2012 (278) E.L.T. 26 (S.C.), the Apex Court while dealing a matter relating to Central Excise Act, 1944 where Section 35G provides for an appeal before the High Court if it involves the substantial question of law held : "4. We reiterate that the High Court, under Article 226 of the Constitution of India, has vast powers as this Court has under Article 32 of the Constitution of India, but such powers can only be exercised in those cases where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when....
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....d only against a notice issued under Section 56(4) of the Act requiring the appellant to show cause why the Registration Certificate be not cancelled. The appellant, it is contended, should have submitted a reply to that notice and allowed the Registrar to dispose of the whole matter on merits particularly as the Registrar had initiated the action principally on the ground that the appellant had obtained the renewal ' of the trade mark by misrepresentation and concealment of relevant facts. 11. Mr. Chagla, in reply, has submitted that where the action initiated by a statutory authority is wholly without jurisdiction, it can be challenged under Article 226 of the Constitution and the writ petition cannot be dismissed summarily. In the instant case, the Registrar, it is contended, could not have legally acted as the Tribunal as the "proceeding concerned" was pending before the High Court and, therefore, the High Court alone could have acted as a "Tribunal" and initiated action under Section 56(4) of the Act. 12. Learned counsel appearing on behalf of the parties have thus tried to create a whirlpool of arguments around the word "Tribunal" as defined in Section 2(1)(x)....
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....least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field." 18. This Court in case of Polar Industries Ltd. (supra), in an unreported judgment does not laid down the proposition that an order for dispensation of the pre-deposit of the duty is not amenable to appeal but what is held is that the said remedy is not exhaustive and/or definite because of the peculiarity in the provision relating to the involvement of substantial question of law in these words : "Section 35G of the Central Excise Act, 1944 provides that an appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any....
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....this Court to refuse to exercise its writ jurisdiction on the sole ground of existence of an alternative remedy of appeal and more so, when it prima facie appears to this Court that the order impugned does not give rise to a substantial question of law that requires determination." 21. What could be culled out from the above decision that the power under Article 226 can be exercised even there being an alternative remedy but to be considered as a rule of self-imposed limitation. It is essentially a rule of policy, convenience, a discretion and not a rule of law. Therefore, the writ petition cannot be said to be non-maintainable merely because an alternative remedy is provided under the statute if the case comes within the exceptions as laid down in the above noted reports. 22.  In W.P. 25803 (w) of 2013, the petitioner challenged the order passed by the adjudicating authority under the Customs Act before the Appellate Tribunal. The officer of the bearer of Regional Unit, Siliguri found the red sander woods concealed under the bag of master oil cakes for export to Bangladesh, The assessee used the import and export port for master oil cakes but appears to have been t....
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....novate the mechanism for dismissal thereof at any stage of the said appeal. The appellate tribunal could very well proceed to decide the appeal and simultaneously therewith, the adjudicating authority can take recourse to the provision of the statute for recovery thereof. The statutory authorities are bound to act within the precincts of the statute and cannot travel beyond it. By imposing the condition that if the deposit is not made, the appeal would attract dismissal, such course is neither contemplated under the Customs Act not could confer power upon the statutory authority whose genesis whereof flows therefrom. 24. This Court, therefore, finds that the order dated 21-2-2013 by which the appeal is dismissed by the Appellate Tribunal is illegal and beyond the powers conferred under the Customs Act. 25. This Court, therefore, set aside the said order dated 21-2-2013 to the extent where it relates to the dismissal of an appeal and does not interfere with the order by which the miscellaneous application is dismissed by the Tribunal. This Court hereby refused to interfere with the discretionary order dated 4-10-2012 passed by the Appellate Tribunal. The petitioner i....