Tigrania Metal and Steel Vs. Commissioner of Customs and - Court Judgment

Excerpt:
1. m/s. tigrania metal & steel industries are engaged in the manufacture of iron and steel products falling under chapter 72 of the schedule to the ceta, 1985. they were clearing their goods at nil rate of duty by availing exemption under the notification 204/83 and 208/83 both dated 01/08/1983. the department alleged contravention of the provisions of notification 208/83 on the ground that they had used non duty paid ship breaking scrap in the manufacture of their final products and issued a show cause notice dated 29/07/1988 covering the period from 01/08/1983 to 31/03/1986 proposing recovery of duty of rs. 69, 73, 171.81 by denying the benefit of the notification. the commissioner of central excise, aurangabad, confirmed the demand. in appeal, the tribunal upheld the denial of the benefit of the notification but remanded the case to the adjudicating authority on the aspect of time barred nature of the demand. the adjudicating authority passed the present impugned order holding that the appellants has suppressed the fact of utilisation of inputs not specified in the notification with intention to evade payment of duty by availing of inadmissible exemptions; and therefore he confirmed the duties and penalties of rs. 5 lakhs upon the manufacturer and rs. 2 lakhs upon its partner. hence these appeals.2. none appears for the appellants in spite of notice, hence we heard the learned jt. cdr and perused the records. we proceed to dispose of the appeals themselves after waiving pre-deposit for the reasons recorded below.3. the principal grievance of the appellants is that the notice fixing personal hearing on 19/10/2001 was received at the appellants' factory on 20/10/2001 i.e., after the date of hearing and which was received by the partner of the manufacturer only on 24/10/2001 as there was a lockout in the factory. therefore the appellant submits that the order has been passed without granting them a hearing.4. we note that immediately on receipt of the hearing notice on 20/10/2001 the appellants had requested for adjournment, however, the commissioner has passed the order on 25/10/2001 itself without any opportunity to the appellants to present themselves before him and explain their case. in these circumstances we are satisfied that there has been a serious contravention of the principles of natural justice.we therefore set aside the ex-parte order and remand the case to the jurisdictional commissioner for fresh decision on the aspect of time bar as directed in tribunal's order no. 186/2001-b dated 29/03/2003.fresh orders shall be passed after granting a reasonable opportunity of hearing to the appellants.

Judgment:
1. M/s. Tigrania Metal & Steel Industries are engaged in the manufacture of iron and steel products falling under Chapter 72 of the Schedule to the CETA, 1985. They were clearing their goods at nil rate of duty by availing exemption under the Notification 204/83 and 208/83 both dated 01/08/1983. The department alleged contravention of the provisions of Notification 208/83 on the ground that they had used non duty paid ship breaking scrap in the manufacture of their final products and issued a show cause notice dated 29/07/1988 covering the period from 01/08/1983 to 31/03/1986 proposing recovery of duty of Rs. 69, 73, 171.81 by denying the benefit of the notification. The Commissioner of Central Excise, Aurangabad, confirmed the demand. In appeal, the Tribunal upheld the denial of the benefit of the notification but remanded the case to the adjudicating authority on the aspect of time barred nature of the demand. The adjudicating authority passed the present impugned order holding that the appellants has suppressed the fact of utilisation of inputs not specified in the notification with intention to evade payment of duty by availing of inadmissible exemptions; and therefore he confirmed the duties and penalties of Rs. 5 lakhs upon the manufacturer and Rs. 2 lakhs upon its partner. Hence these appeals.

2. None appears for the appellants in spite of notice, hence we heard the learned Jt. CDR and perused the records. We proceed to dispose of the appeals themselves after waiving pre-deposit for the reasons recorded below.

3. The principal grievance of the appellants is that the notice fixing personal hearing on 19/10/2001 was received at the appellants' factory on 20/10/2001 i.e., after the date of hearing and which was received by the partner of the manufacturer only on 24/10/2001 as there was a lockout in the factory. Therefore the appellant submits that the order has been passed without granting them a hearing.

4. We note that immediately on receipt of the hearing notice on 20/10/2001 the appellants had requested for adjournment, however, the Commissioner has passed the order on 25/10/2001 itself without any opportunity to the appellants to present themselves before him and explain their case. In these circumstances we are satisfied that there has been a serious contravention of the principles of natural justice.

We therefore set aside the ex-parte order and remand the case to the jurisdictional Commissioner for fresh decision on the aspect of time bar as directed in Tribunal's order No. 186/2001-B dated 29/03/2003.

Fresh orders shall be passed after granting a reasonable opportunity of hearing to the appellants.