Matter Heard by One Commissioner & Order Passed by Another Commissioner Without Considering Assessee’s Submissions: CESTAT Quashes Order on Natural Justice Violation

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Kolkata has set aside the order passed by the Commissioner of Central Excise citing a grave violation of the principles of natural justice since the order was passed by a different commissioner from the one who heard the matter and the order was passed without considering the submissions of the assessee.

The appeal was filed by M/s. M.B. Control & Systems Private Limited against the order of Commissioner of Central Excise demanding central excise duty along with interest under Section 11AB and penalty under Section 11AC of the Central Excise Act, 1944.

During the course of the proceedings, the matter was initially heard by Commissioner Dr. Sanjay Agarwal, but the final order was passed by another Commissioner Mr. Prashant Kumar, without considering the submissions made by the appellant.

The appellant assessee, represented by Shri N.K. Chowdhury argued that the change of the adjudicating authority during the proceedings without proper consideration of the submissions violated principles of natural justice.

The respondent revenue, Commissioner of Central Excise, represented by Shri A. Roy reiterated the findings.

The CESTAT held that there is violation of the principles of natural justice as the adjudicating authority should have given due consideration to the appellant’s arguments and submissions from a legal perspective before pronouncing the verdict.

The bench also held that the matter should have been heard and decided by the same Commissioner who conducted the hearing.

It was also observed that the Show Cause Notice (SCN) was issued to the appellant invoking an extended period of limitation and the order was issued without considering the appellant’s contentions even though they had submitted a detailed reply to the SCN with substantial proof denying the allegations and disputing the demand, the bench held.

In conclusion, the two-member bench consisting of Mr. Ashok Jindal (Judicial Member) and Mr. K. Anpazhakan (Technical Member) allowed the appeal filed by the assessee along with consequential relief, setting aside the order passed by Commissioner Mr. Prashant Kumar.

To Read the full text of the Order CLICK HERE

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