UNION OF INDIA Vs. SURTI SYNTEX LTD

JUDGEMENT

(1.) THESE special, appeals under Section 18 of the Rajasthan High Court Ordinance, 1949 are directed against an order of a learned single Judge of this Court dated May 14, 1985, by which the 18 writ petitions were allowed and the order of the Assistant Collector (Central Excise) was quashed and the Assistant Collector was directed to decide the matter in dispute afresh after giving the petitioners adequate opportunity of hearing.

(2.) THE petitioners are manufacturers of cellulosic spun yarn. In the writ petitions filed by them, the contention raised on their behalf is that the blended product does not contain any man -made fibre of non -cel1ulosic origin. Till recently, duty was levied on their product treating it to be covered by item 18 III(i) of the Schedule annexed with the Central Excises and Salt Act, 1944. In the classification submitted by them before the Assistant Collector (Central Excise), they had shown their product as that covered by the aforesaid entry, on the ground that it does not contain any man -made fibre of non -cellulosic origin. The Assistant Collector (Central Excise), however, passed the impugned order treating the product of the petitioners as falling under item 18 III(ii) of the Schedule annexed with the Act. The order of the Assistant Collector was challenged on multiple grounds and one of them was that the impugned order was passed by him without hearing them. The stand taken by the Revenue is that the product of the petitioners contains man -made fibres of non -cellulosic origin. As such, the product of the petitioners falls under item 18 III (ii) of the Schedule for the purpose of levying the duty. It was, however, not specifically denied that the petitioners were not heard before the impugned order was passed by the learned Assistant Collector. The learned single judge took the view that the question whether the product of the petitioners is covered by Clause (i) or Clause (ii) of item 18 III cannot be adequately decided without taking evidence in the form of affidavit or otherwise. He further held that the Assistant Collector neither heard the petitioners nor afforded an adequate opportunity to them before passing the impugned order and treating the petitioners' product as covered by item 18 III(ii) of the Schedule. According to the learned single judge, the Assistant Collector was a quasi -judicial authority and before passing the impugned order, he should have afforded adequate opportunity to the petitioners to be heard. The impugned order was, thus passed in violation of the principle of natural justice. The writ petitions were consequently allowed and the Assistant Collector was directed to decide the matter afresh after giving the petitioners adeqnat eopportunity of hearing in the light of the observations made by him.

(3.) WE have heard Mr. J.P. Joshi, learned Counsel for the appellants and Mr. Paras Kuhad, learned Counsel for the respondents and perused the judgments passed by the learned single judge and the Division Bench at Jaipur.