Navabharat Systems And Devices (P) LTD vs. The Commissioner Of Central Tax & Central Excise - Kerala High Court, 06 September 2018

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU THURSDAY ,THE 06TH DAY OF SEPTEMBER 2018 / 15TH BHADRA, 1940 WP(C).No. 19644 of 2018 PETITIONER/S: NAVABHARAT SYSTEMS AND DEVICES (P) LTD V/8, POLLACHI ROAD, ELAPPULLY, PALAKKAD-678622, REPRESENTED BY ITS MANAGING DIRECTOR, A.V.RAJAPPAN. BY ADV. SRI.JOBY JACOB PULICKEKUDY RESPONDENT/S: 1 THE COMMISSIONER OF CENTRAL TAX & CENTRAL EXCISE CALICUT COMMISSIONERATE, CALICUT-673001. 2 THE DEPUTY COMMISSIONER OFFICE OF THE DEPUTY COMMISSIONER, CENTRAL TAX AND CENTRAL EXCISE, PALAKKAD GST DIVISION, METTUPALAYAM STREET, PALAKKAD-678001. BY ADV. SRI. SREELAL WARRIER,SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.09.2018,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: 2 WP(C).No. 19644 of 2018

JUDGMENT The petitioner, a manufacturer, submitted its ER3 Returns for the period from April to September 2016, as seen from Ext.P1. Disputing those returns, the respondent authorities issued the Ext.P2 show cause notice, contending that the aggregate value of clearance during the preceding year 2015-16 was Rs.4,05,35,012. The assessees has acceded to the specified aggregate value for availing itself of the exemption, which is otherwise available for the petitioner under Ext.P1. Then it has lead to adjudication of the issue.

As seen from Ext.P4, the 2nd respondent issued the Ext.P4 notice, requiring the petitioner to participate in the hearing. The notice gives the option of three dates for the petitioner. But the petitioner submitted the Ext.P5 reply, seeking adjournment. The 2nd respondent refused to accommodate the petitioner's request for adjournment, went ahead and decided the issue, through Ext.P6. Impugning the Ext.P6, the petitioner has filed this writ petition.

The petitioner's counsel to begin with has raised three contentions: (1) the 2nd respondent has no authority to adjudicate the issue and to hold that the petitioner is not entitled to any tax exemption under Ext.P1. For the 101st Constitutional Amendment bars the authorities from adjudicating the issue, the very act has become unavailable; (2) the adjudication is hit by the principles of natural justice. That is, the Ext.P6 violates the principles of natural justice and (3) the authorities have denied the petitioner an opportunity to put forth its case on merits.

But Sri.Joby Jacob has, in the end, submitted that it will suffice if this Court sets aside the Ext.P6 and remands the matter because the order is ex-parte.

Sri.Sreelal N.Warrier, the learned Senior Standing Counsel for the respondents, has submitted that the statute mandates that an assessee could have three adjournments at the maximum. According to him, through Ext.P4, the petitioner was given an opportunity of appearance on any of the three dates. Instead, the petitioner chose to seek an adjournment. But the authorities could not adjourn the matter because of the statutory interdiction.

Heard the learned counsel for the petitioner as also the learned Senior Counsel for the respondents.

Since the petitioner has questioned the constitutional validity of the proceedings, I queried with the learned counsel, how this Court could remand the matter on the issue of constitutional validity, which the 2nd respondent cannot decide.

In reply, Sri Joby Jacob has submitted that the petitioner is giving up his contentions on that issue that is, the constitutional validity.

About the denial of principles of natural justice, I gather that, as the petitioner's request for adjournment stood denied, there was no opportunity for the petitioner to urge the issue on merits. It cannot per se amount to denial of natural justice.

10.

At any rate, I need to address to the other contention: whether three adjournments were given to the petitioner. Indeed, the Ext.P4 gives three dates in the alternative to the petitioner. And it only amounts to, at best, one adjournment. Therefore, I reckon that though the petitioner sought adjournment only once, but the authority denied it. Under these circumstances, without adverting to the merits, I set aside the Ext.P6 and remand the matter for fresh adjudication. Therefore, the remand is limited to the extent of the 2nd respondent's hearing the petitioner on a date fixed by him. And that date cannot be altered at the petitioner’s request. Thus, the 2nd respondent may adjudicate the issue on merits. DAMA SESHADRI NAIDU JUDGE SB/12/09/2018 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE PHOTOCOPY OF NOTIFICATION NO.08/2003 CE DATED 01.03.2003. EXHIBIT P2 TRUE PHOTOCOPY OF SHOW CAUSE NOTICE NO.3/2017/GST/C.E. DATED 19.10.2017. EXHIBIT P3 TRUE PHOTOCOPY OF OBJECTION DATED 20.11.2017 SUBMITTED BY THE PETITIONER TO THE 2ND RESPONDENT. EXHIBIT P4 TRUE PHOTOCOPY OF NOTICE DATED 07.03.2018 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P5 TRUE PHOTOCOPY OF LETTER DATED 20.03.2018 SUBMITTED BY THE PETITIONER. EXHIBIT P6 TRUE PHOTOCOPY OF ORDER DATED 28.03.2018 PASSED BY THE 2ND RESPONDENT. //// P.A to Judge