The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that issuing a consolidated hearing notice with multiple hearing dates constitutes a violation of the principles of natural justice.
The decision came in response to appeals filed by M/s IND Swift Laboratories against the orders passed by the Commissioner (Appeals), Central Goods and Services Tax ( CGST ), Central Excise and Customs, Jammu.
The case revolved around the rejection of refund claims by the Commissioner (Appeals) without affording the appellant proper opportunity for a hearing. The order was passed ex parte, which was challenged by M/s IND Swift Laboratories before the CESTAT.
The appellant, represented by Shri Surjeet Bhadu argued that the consolidation of hearing dates without due consideration of the appellant’s circumstances violated their right to a fair hearing.
The respondent revenue, Commissioner of Central Excise and Service Tax, Jammu & Kashmir, represented by Shri Narinder Singh contended that the appellant failed to appear for hearings, leading to the Commissioner (Appeals) proceeding ex parte. Hence, the Commissioner’s decision to reject the appeals was justified based on the appellant’s non-compliance with procedural requirements.
The CESTAT held that the orders passed by the Commissioner (Appeals) are unsustainable in law. The bench highlighted that the consolidated hearing notice, which granted three different hearing dates in a single notice, contravened the principles of natural justice.
The bench, citing a precedent set by the Hon’ble High Court of Gujarat in the case of Regent Overseas Pvt. Ltd. vs. Union of India, emphasised that such a practice does not align with the statutory provisions and undermines the appellant’s right to a fair hearing.
The bench stressed the importance of procedural fairness in administrative proceedings. The CESTAT pointed out that the consolidation of hearing dates not only deprived the appellant of adequate time to prepare and present its case but also infringed upon the statutory requirement of granting adjournments in a manner consistent with the law. By issuing a consolidated notice with multiple hearing dates, the adjudicating authority failed to adhere to the prescribed procedure, thereby compromising the appellant’s right to due process.
In result, the single bench of Mr. S. S. Garg (Judicial Member) set aside the orders and remanded the case back to the Commissioner (Appeals) with clear instructions. The CESTAT directed the Commissioner (Appeals) to reconsider the case on its merits, ensuring that the appellant is afforded a reasonable opportunity of hearing in accordance with the principles of natural justice. Additionally, the Commissioner (Appeals) was instructed to render a reasoned decision within a specified timeframe to expedite the resolution of the appeals.
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