Delhi International Airport Limited vs. Commissioner Of CGST And Central Excise Appeals Delhi Ii & Ors.

Held

The Court held that the CESTAT had erred in law by dismissing the Petitioner's appeal for non-prosecution and subsequently dismissing the restoration application without affording the Petitioner an opportunity of being heard. The Court relied on the principle that appeals before the Tribunal must be decided on merits, and dismissal for default or non-prosecution is not permissible when the appellant is absent. The Court cited *CEAT Tyres of India Ltd. v. Commissioner of Central Excise* and *Prakash Fabricators & Galvanizers P. Ltd. v. Union of India*, which state that the Tribunal should decide appeals ex-parte on merits if the appellant is not present. The Court found that the CESTAT failed to ensure proper service of notices, particularly to the correct address, and that the dismissal of the restoration application was also based on a non-application of mind. Therefore, the impugned orders of the CESTAT dated 16.10.2014 and 13.11.2019 were set aside. The CESTAT was directed to decide the Petitioner's appeal on merits. The Petitioner was not to press for interest for the period between the filing of the appeal and the dismissal of the restoration application. The Petitioner was also burdened with costs of Rs. 20,000/-.

Facts

The Petitioner, Delhi International Airport Limited, filed a writ petition challenging two orders passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The Petitioner sought a refund of Rs. 39,09,130/- in Service Tax, which was paid twice, once via challan and again through CENVAT credit. The refund application was rejected by the Order-in-Original dated 28.06.2013, and this was upheld by the Commissioner (Appeals) in its Order-in-Appeal dated 30.04.2014. The Petitioner appealed to the CESTAT, which dismissed the appeal on 16.10.2014 for non-prosecution, stating that the hearing notice was returned unserved. A subsequent application for restoration of the appeal was also dismissed by the CESTAT on 13.11.2019 for non-prosecution and failure to show sufficient cause. The Petitioner contended that these orders were passed without affording an opportunity of being heard and in violation of natural justice.

Key Issues

1. Whether the CESTAT erred in dismissing the Petitioner's appeal for non-prosecution without affording an opportunity of being heard, thereby violating the principles of natural justice, as per Section 35C(1) of the Central Excise Act, 1944? 2. Whether the CESTAT erred in dismissing the Petitioner's application for restoration of its appeal for non-prosecution, again without affording an opportunity of being heard and without ensuring proper service of notice, contrary to established legal principles? Petitioner's Arguments: The Petitioner argued that the CESTAT's orders dismissing the appeal and the restoration application were passed in violation of the principles of natural justice. They contended that the CESTAT should have decided the appeal on merits, even in the absence of the appellant, as per Section 35C(1) of the CE Act and relied on the Supreme Court's decision in *CEAT Tyres of India Ltd. v. Commissioner of Central Excise* and a Delhi High Court judgment in *Prakash Fabricators & Galvanizers P. Ltd. v. Union of India*. The Petitioner also highlighted that notices were sent to an incorrect address, and the CESTAT failed to ensure proper service, especially after the initial dismissal for non-prosecution. Revenue's Arguments: The judgment does not record any specific arguments made by the Revenue.