ORDER
G.P. Agarwal, Member (J)
1. This appeal is directed against the impugned Order-in-Appeal passed by the Collector (Appeals), Bombay.
2. Shortly put the facts of the case are that, a Show Cause-cum-Demand Notice dated 18-5-1983 was issued to the appellants calling upon them to show cause as to why the excise duty be not recovered from them on the printed boxes made out of solid board and cleared by them without payment of duty during the period 5-5-1982 to 26-2-1983 for the reasons that the printed boxes made out of solid fibre board, were chargeable to duty under Tariff Item 17(4) prior to 1-3-1983. The appellants contested the Show Cause Notice and ultimately the Assistant Collector of Central Excise vide his adjudication order dated 14th February, 1986 dropped the demand. However, it appears that the concerned Collector of Central Excise was not satisfied with the said adjudication order, and therefore, he in exercise of his powers given under Sub-section (2) of Section 35E of the Central Excises and Salt Act, 1944 directed the Assistant Collector to file the application (appeal) before the Collector (Appeals) under Section 35E(4) of the Act seeking to set aside the said adjudication Order. Accordingly, the Assistant Collector filed the application (appeals) before the Collector (Appeals) who vide his impugned Order-in-Appeal allowed the same. Hence the present appeal by the assessee.
3. The only contention which was urged by the learned counsel for the appellants was that, under Sub-section (3) of Section 35E of the Act, the Collector can pass the Order under Sub-section (2) of the same Section only within one year from the date of the Order of the Adjudicating Authority. Since in the instant case, the Order given by the Collector under Sub-section (2) of Section 35E to the Assistant Collector for filing the application (appeal) under Section 35(4) of the Act was passed on 14-4-1987 the same was time-barred being beyond the period of one year and the Collector (Appeals) has no power to condone the delay, so occurred in passing the said Order by the Collector on 14-4-1987. In support of this contention, the case of Collector of Central Excise, Madras v. M.M. Rubber & Co., Tamil Nadu -1991 (55) E.L.T. 289 (SC), was cited wherein it was held by the Apex Court that the period of one year is to be computed from the date of signing of the Order by the Adjudicating Authority as the date of communication of the Order to the Department is not relevant. In reply, Shri L.N. Murthy, learned JDR, left the matter to the discretion of the Bench in view of the said judgment of the Apex Court and submitted that, whatever was argued on behalf of the Revenue in that case before the Apex Court be taken as his arguments in the present case.
4. We have considered the submissions.
5. Admittedly, the Order passed by the Collector of Central Excise, Bombay-III, under Sub-section (2) of Section 35E was not passed within one year from the date of the Order of the Adjudicating Authority, and therefore, the Collector himself requested in his said Order that “2. The delay in filing the review application against the present Order-in-Original is on account of administrative grounds. Since the issue involves important question of law having wider impact the delay may be condoned.” On this request, the Collector (Appeals) in para 1 (internal page 7) has condoned the delay observing as follows :-
“There is a delay of a less than 3 months in issuing the review order. (Collector) This delay has been satisfactorily explained. After that there is no delay in filing the EA 2 application. Collector (Appeals) is bound to hear the appeal made within prescribed time of review order.
5.1 In the case of Collector of Central Excise, Madras v. M.M. Rubber & Co., Tamil Nadu, supra, the Apex Court has held that the period of one year fixed under Sub-section (3) of Section 35E of the Act must be computed from the date of the Order of the Adjudicating Authority and not from the date of the communication. Consequently, if such Order is passed beyond the period of limitation of one year the same would be invalid and ineffective.
6. Thus, following the ratio of the said decision, we hold that the Order dated 14-4-1987 passed by the Collector under Sub-section (2) of Section 35E of the Act was invalid and ineffective being passed after the expiry of one year from the date of the Order of the Adjudicating Authority. Here it may also be added that the Collector (Appeals) has no power to condone the delay, so occurred in passing the Order under Sub-section (2) of Section 35E by the Collector.
7. In the result, we set aside the impugned Order-in-Appeal and allow the appeal with consequential relief to the appellants, if any, according to law.