M/s Shri Ambika Ispat india Private Limited Now Keshav Sponge and Energy Private Ltd. vs. The Commissioner Central Excise and Customs

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TAXC/128/2017HC ChhattisgarhCGHC01007965201724 August 2017Author: HON'BLE THE CHIEF JUSTICE,HON'BLE SHRI JUSTICE SHARAD KUMAR GUPTA3 pages

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What did the High Court hold?

The High Court held that the CESTAT was not justified in dismissing the appeal on default. Citing the Supreme Court's judgments in Commissioner of Income Tax v. S. Chenniappa Mudaliar and Balaji Steel Re-Rolling Mills v. Commissioner of Central Excise and Customs, the Court reiterated the principle that an appeal to which Section 35-C of the Central Excise Act applies cannot be decided by the CESTAT by dismissing it for default. The reasoning is that the Tribunal has the power to restore appeals dismissed for default under Rule 20 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982. Therefore, the impugned order of dismissal by the CESTAT was set aside. The appeal before the CESTAT was remitted back for decision on merits after hearing the parties. The parties were directed to appear before the Tribunal on 3rd October, 2017. No costs were awarded.

What were the facts?

The appellant, M/s Shri Ambika Ispat (India) Private Limited, is challenging an order passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT). The CESTAT dismissed the appellant's appeal filed in 2010 on default due to non-appearance. The dispute involved interlocutory relief pending the appeal before the CESTAT, which led to an order by the High Court in Writ Appeal 1029/2012. The appellant claims to have satisfied the conditions imposed by that order. The present appeal is filed before the High Court under Section 35G of the Central Excise Act against the CESTAT's dismissal order dated 12.01.2017.

What were the issues?

1. Whether the CESTAT was justified in dismissing the appeal filed by the assessee on default due to non-appearance of the appellant or its counsel, under Section 35G of the Central Excise Act. Assessee's Contention: The assessee argued that the CESTAT was not justified in dismissing the appeal on default. They relied on the Supreme Court's decision in Commissioner of Income Tax v. S. Chenniappa Mudaliar and Balaji Steel Re-Rolling Mills v. Commissioner of Central Excise and Customs, which held that appeals under Section 35-C of the Central Excise Act cannot be dismissed for default. Revenue's Contention: The judgment does not record any specific arguments made by the Revenue on this issue.

Which sections of the Income-tax Act were involved?

Section 35G, Section 35-C

AI-generated summary — verify with the full judgment below

1 NAFR HIGH COURT OF CHHATTISGARH, BILASPUR TAX Case

No. 128 of 2017 (Arising out of order No. A/ 50331/2017 dated 12.01.2017 in Excise Appeal No. 1032 of 2010 of the learned CESTAT) M/s Shri Ambika Ispat (India) Private Limited (Now Keshav Sponge & Energy Private Ltd.) Taraimal, Ambikapur Road, District Raigarh (Chhattisgarh). ---- Appellant Versus

The Commissioner Central Excise & Customs, New Central Revenue Building, Civil Lines, Raipur, District Raipur, Chhattisgarh.

The Customs, Excise & Service Tax Appellate Tribunal, West Block No. 2, R. K. Puram, New Delhi. ---- Respondents For Appellant : Shri Ashish Shrivastava and Mr. Animesh Verma, Advocates For Respondents : Shri Vinay Pandey, Advocate Hon'ble Shri Thottathil B. Radhakrishnan, Chief Justice Hon'ble Shri Sharad Kumar Gupta, Judge Order On Board Per Thottathil B. Radhakrishnan, Chief Justice 25.08.2017

This appeal is admitted. Shri Vinay Pandey, Advocate appears for the Revenue. The service is complete. Heard finally on the consent of the parties.

The only issue that arise for decision in this appeal under Section 2 35G of the Central Excise Act is as to whether the CESTAT was justified in dismissing the appeal filed by the assessee on default on account of non appearance of the appellant or its counsel. Hearing the learned counsel for the parties and perusing the materials on record, we see that though the appeal was filed in 2010, there were certain disputes between the department and the appellant as regards the interlocutory relief that should governs parties pending

the appeal before the CESTAT. That culminated in order Annexure A/7 dated 13.09.2012, passed by this Court in Writ Appeal 1029/2012. We are told by the learned counsel for the appellant that the condition imposed as per that order has been satisfied by remittance. We have perused the materials produced along with this appeal which discloses, among other things, the grounds of the appeal raised before the CESTAT.

Section 35(C) of the Central Excise Act delineates the power of the Appellate Tribunal. Rule 20 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 provides for dismissal of appeal for default and for restoration of those appeals which are dismissed for default. Adopting the reasoning of the judgment of the Hon'ble Supreme Court in Commissioner of Income Tax v. S. Chenniappa Mudaliar {(1969) 1 SCC 591} rendered under the Income Tax Act and the Income Tax Appellate Tribunal Rules, the Apex Court decided the case of Balaji Steel Re-Rolling Mills v. Commissioner of Central Excise and Customs {(2014) 16 SCC 360} holding that an appeal to which Section 35-C of the Central Excise Act applies cannot be decided

3 by the CESTAT by dismissing it for default. Applying the ratio of that precedent, the appeal which has been dismissed through the impugned order is eligible to be restored by setting aside the order of dismissal of the appeal.

In the result, this appeal is allowed setting aside the impugned judgment and remitting the appeal on which that order have been issued to CESTAT for decision on merits after hearing the parties. It is directed that the parties shall mark appearance before the Tribunal on 3rd October, 2017. No costs. (Thottathil B. Radhakrishnan) (Sharad Kumar Gupta) Chief Justice Judge Kishore

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