Not providing the relied documents used for computing demand is violation of principles of natural justice.

PJ-Case law-2012/13-1560

Case:-M/S SOMNATH AUTO GARAGE SHRI VIRABHAI O MYATRA Versus COMMISSIONER OF CENTRAL EXCISE , BHAVANAGAR

Citation:-2013-TIOL-540-CESTAT-AHM

Issue:-Not providing the relied documents used for computing demand is violation of principles of natural justice.

Brief Facts:-These stay petitions are filed for the waiver of the pre-deposit of the amount of duty liability confirmed along with interest on the main appellant M/s. Somnath Auto Garage as on the clandestinely removed chhakdo rickshwas, penalty thereof and also penalty on the partner of the main appellant. After hearing both sides at length on the stay petition, it was felt that the issued involved in this case needs to be factually verified hence after disposing the stay petitions, the appeals themselves were taken for disposal.

Appellant Contentions:-Ld. counsel submits that the entire case of the department is built on annexure-A of the show cause notice which runs into 29 pages. It is his submission that the said details, according to the show cause notice, was taken from the details received from various RTO agencies and the reports of the RTO authorities in Gujarat. It is his submission that despite seeking the copy of such RTO report and the copies, the departmental authority has not responded and has not given the details. It is his submission that if the duty liability is demanded on a document which has been reduced to a worksheet, in the show causes notice, it is imperative that the lower authorities supply the copies of the said details which have been reduced to a format detailing the demand.

Respondent Contentions:-Ld D. R. on the other hand submitted that when there is an admission of the partner that there is clandestine removal, there was no need for giving any further details, this bench has been directing them to deposit of 50% of the amounts involved and in some cases 100% of the amounts involved. It is the submission that the conduct of the assessee before the lower authorities also needs to be considered as they have time and again stalled the adjudication proceeding, by seeking various documents at various times, despite they were given the same along with show cause notice.

Reasoning of Judgment:-We have considered the submission from both the parties and perused the record, we find that the appellant has been making a demand for documents on which, the lower authorities have issued a show cause notice i.e. annexure-A. On perusal of the said annexure-A, we find that the annexure gives only details of the rickshwas which were registered with the RTO. RTO authorities have given details as regards the documents which were supplied for registration of such vehicles, we find prima facie force in the contentions raised by the ld. counsel that for registration of such rickshwas by the RTO authorities, there are some forms which would indicate who has manufactured the vehicles and to whom sales is made, signed by authorised signatory. At this juncture, we are unable to comment on the issue as nothing is produced before them, at the same time, we find that the conduct of the assessee before the lower authorities is also deplorable, in as much as they have been seeking documents at various times and sometimes asking for the copies of the show cause notice stating that they were misplaced. Suffice to say that the assessee has been trying to delay the adjudication proceeding by seeking various documents at various times, we find that the issue involved in this case needs to be factually appreciated by the lower authorities by giving the documents on which the reliance has been placed to prepare statement/excel sheet wherein the demand has been worked out (in Annexure-A to SCN). To that extent, we agree with the ld. counsel that there is a violation of principles of natural justice and we also note that this point was not raised by any of the appellants who appeared before us in other earlier matters; in order to ensure that the appellant appears before the adjudicating authority; collects the documents from the adjudicating authority and cooperates in the adjudicating proceedings, we find that the appellant should be directed to deposit some amount. Accordingly, we direct the appellant to deposit an amount of Rs.25 lacs on or before 6.2.2013 and report such compliance to the adjudicating authority. Assessees are also directed to give the list of copies of documents of which he would like to have for properly defending his case on or before 6.2.2013. On receipt of such request from the assessee, the adjudicating authority will provide the copies of the documents which are requested by the appellant within four weeks from that date. After completion of this process, the adjudicating authority will consider the issue afresh after following the principles of natural justice.

The stay petitions and appeals are disposed of as indicated hereinabove.

Decision:-Partial Stay granted.

Comment:-It can be concluded from this case that it is obligatory on the revenue to provide with the documents relied upon for computing the demand and at the same time it is obligatory on the assessee also to cooperate with the adjudication proceedings in a proper manner and the assessee should not attempt to delay the proceedings.

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PJ-Case law-2012/13-1560

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