IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 24/02/2005
CORAM
THE HON'BLE MR.MARKANDEY KATJU, THE CHIEF JUSTICE
AND
THE HON'BLE MR.JUSTICE D.MURUGESAN
R.C.P.No.54 of 2002
Commissioner of Central Excise
Chennai-II Commissionerate
M.H.U.Complex
No.692, Anna Salai
Nandanam
Chennai 600 035 .. Petitioner
-Vs-
1. Customs, Excise & Gold (Control)
Appellate Tribunal
South Zonal Bench at Chennai
1st Floor, Shastri Bhavan Annexe
26, Haddows Road
Chennai 600 006
2. M/s Babcock Borsig Power Systems Ltd.,
No.18/2A, Senneer Kuppam Bye-pass Road
Poonamallee, Chennai 600 056 .. Respondents
Reference Application under sub-section (1) of Section 35H(1) of the
Central Excise Act, 1944 against the final order No.180/2002 dated 25.2.2002
passed by the Customs, Excise & Gold (Control) Appellate Tribunal, South Zonal
Bench at Chennai.
!For Petitioner :: Mr.K.Veeraraghavan
Addl. Central Government
Standing Counsel
^For Respondents :: R1-Tribunal
Mr.S.Muthuvenkataraman
for R2
:ORDER
(Order of the Court was delivered by
The Hon’ble The Chief Justice)
This is a reference application under Section 35H(1) of the Central
Excise Act, by which the following question is sought to be referred to us for
our opinion:-
“Whether the Tribunal was right in passing the order on an issue not agitated
before it and thereby reopening a matter already settled and not agitated
before them?”
2. Heard the learned counsel for the parties.
3. We have carefully perused the judgment of the CEGAT dated 25.2.20
02. In that judgment the CEGAT has recorded a finding of fact in paragraph 6
that there was no suppression of facts by the assessee to invoke the larger
period of limitation under the proviso to Section 11 A of the Central Excise
Act. Mr.K.Veeraraghavan, learned counsel for the department submitted that
the Assistant Commissioner as well as the Commissioner (Appeals) have recorded
findings that there was suppression.
4. Under the hierarchy of quasi-judicial authorities, in the Central
Excise Act, at the lowest is the Assistant Commissioner against whose orders
appeals lie under Section 35 of the Central Excise Act to the Commissioner
(Appeals) and, thereafter, a second appeal to the CEGAT under Section 35B. It
may be noted that the second appeal to the CEGAT is not like a second appeal
under Section 100 C.P.C., since it is not confined to questions of law.
Second appeals under different statutes can have different meanings and
different scope. A second appeal under Section 35B of the Central Excise Act
is like a first appeal under Section 96 C.P.C. inasmuch as findings of fact
can also be gone into and the CEGAT can re-appreciate or reassess the
evidence. Thus the orders of the Assistant Commissioner and the Commissioner
( Appeals) merge into the order of the CEGAT by the doctrine of merger, and
the only order which now survives is the order of CEGAT. Hence the reference
to the orders of the Assistant Commissioner and the Commissioner (Appeals) is
wholly misconceived, as these orders no longer survive after the order of the
CEGAT. The CEGAT has recorded a clear finding of fact that there is no
suppression, and hence, obviously, the demand was time barred since the larger
period of limitation under the proviso to Section 11A is not applicable.
5. Mr.K.Veeraraghavan, learned counsel for the department submitted
that the Tribunal has granted the relief which was not prayed for and it has
traversed beyond the scope of the dispute pending before it because the
dispute was only regarding penalty and interest. In our opinion, this
argument has no merits because once the Tribunal holds that the demand is
barred by limitation in view of Section 11A of the Central Excise Act since
there was no suppression, obviously the demand cannot be pressed against the
assessee.
6. Thus there is no force in this reference application and it is
rejected.
Index: yes
Internet: yes
ss
To
1. Customs, Excise & Gold (Control)
Appellate Tribunal
South Zonal Bench at Chennai
1st Floor, Shastri Bhavan Annexe
26, Haddows Road
Chennai 600 006
2. Commissioner of Central Excise
Chennai-II Commissionerate
M.H.U.Complex
No.692, Anna Salai
Nandanam
Chennai 600 035