BHARATI ENTERPRISES Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) TODAY , only stay application was listed for hearing. However, it appears that the matter calls for remand on the ground of non -compliance with the principles of natural justice. Hence, we have decided to take up the appeal for hearing on the limited issue of non -compliance with the principles of natural justice and have requested both the parties to advance their arguments on this aspect, by granting waiver of predeposit.

(2.) SHRI Kantawalla, the ld. advocate, for the appellants submits that the appellants were served with show cause notice on 26 -4 -1994. Because, only 15 days were granted for filing reply to the show cause notice and as the allegations against the appellants were of grave nature, they wanted some time for purpose of preparing detailed reply and hence they sought for extension of time. Though extension of time was granted for filing the reply to the show cause notice, the matter was also listed for final hearing and this date of hearing was fixed as on 14 -7 -1994. They sought for adjournment which was granted to them and the matter was again listed on 17 -8 -1994. On that day also they requested for grant of adjournment and. They were told that the next date of hearing will be intimated in due course. In the submission of Shri Kantawalla, the next date happened to be 30 -8 -1994 but the communication thereof was not received by the appellants and hence, they could not remain present. However, under the belief that the date for hearing had not been duly fixed, they filed the reply on 24 -9 -1994, and thereafter also when they, did not receive any intimation about fixing the date for hearing, they vide, their letters dated 2 -9 -1994 and 15 -9 -1994, have requested the adjudicating authority to intimate them the next date of hearing fixed. However, on 4 -10 -1994, they received a letter from the adjudicating authority to the effect that the matter had already stood decided in their absence as they had failed to appear on 30 -8 -1994. In the submission of Shri Kantawalla, it is clear that the appellant had not been heard on merits and ex parte order came to be passed. He refers to the order -inoriginal and submits that the order -in -original was signed on 28 -10 -1994 indicating that by the time the reply to the show cause notice was filed, the decision on merits had not been taken. In his submission, even if they could not remain present on 30 -8 -1994, when they had already made a representation and had filed their written reply much before the adjudicating authority took the decision on merits, the said authority ought to have taken into consideration their written reply and ought to have also given them an opportunity of being heard in person. In his submission, therefore, the matter not only calls for unconditional stay and waiver but would call for remand.

(3.) SHRI Mondal, the ld. Departmental Representative, however, submits that he is not agreeable to the passing of order of remand at this stage. He has referred to the records called for from the Department and has submitted that the show cause notice issued on 26 -4 -1994 granted 15 days time to the appellants to file the reply. However, the Department received a letter dated 27 -41994 from the appellants seeking for extension by 15 days which came to be granted vide their letter dated 4 -5 -1994. Yet another letter was received on 6 -5 -1994 seeking extension of one month for filing the reply and the same was granted vide letter dated 18 -5 -1994. Then again, a letter was received on 3 -6 -1994 seeking extension of time and reply thereto was sent on 7 -7 -1994 informing them that the personal hearing was also fixed on 14 -7 -1994 and that they may appear along with the reply to the show cause notice. In his submission, the appellants did not send the reply but sought for adjournment vide their letter dated 9 -7 -1994 and the matter was listed for hearing on 17 -8 -1994. On that date also, the appellants sought for adjournment and hence the matter was adjourned to 30 -8 -1994 and intimation for the same was sent by speed post on 23 -8 -1994. He shows us the receipt from the postal authority for the delivery to them under the speed post for being served on the appellants. In his submission, the letter sent under speed post, is deemed to have been received within 24 hours and the appellants having not appeared on that particular date, were deemed to have not thought it proper to appear and participate in the adjudication proceedings and hence a decision was taken on that date by the adjudicating authority to proceed ex parte against the appellants. He has also referred to the observation made by the adjudicating authority in his said order to the effect that on that date, all the parties other than the appellants were present and arguments were concluded on the same date. He has also referred to the letter dated 15 -9 -1994 received from the appellants and the endorsement made by the adjudicating authority thereon to the effect that the decision to proceed ex parte had already been taken. The same has been duly communicated to the appellants vide the Department's letter dated 4 -10 -1994. In his submission, when the matter was decided to be proceeded with ex parte, it was not necessary for the adjudicating authority to enter into the correspondence with the appellants on the letters sent subsequent to the taking of the said decision to proceeds ex parte. He also pleads that the signing of the order precedes by preparation of draft order and the relevant date of decision in relation to the adjudication proceedings would be the date on which the draft order is prepared and sent for final typing. He submits that this being the procedural aspect adopted by the Customs Department, merely because the order was sent on 28 -10 -1994, that would not indicate that the final order is passed only on the same date. In the alternate, he submits that even assuming that the Bench is of the opinion that there is non -compliance with the principles of natural justice and that the appellants ought to get an opportunity of being heard, they should be put to the strict terms as to participation in the adjudication proceedings and also they should be asked to deposit the amount, as prima facie it has already been established that the appellants are guilty of the conduct warranting imposition of penalty under Section 114 of the Customs Act.