The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) while dismissing the restoration application on the ground that 6 hearings have been offered appellant did not appear, 7th hearing Notice not received is not a valid ground.
The Bench of Ms.Binu Tamta, Member (Judicial) and Ms.Hemambika R. Priya, Member(Technical) has observed it was not a case where the appeal has been dismissed for want of presence or prosecution. The Final Order has been passed on merits after considering all the grounds of appeal and submissions of the appellant in the Appeal Memorandum and by considering the submissions of Revenue.
The bench has held that Restoration of Appeal (ROA) is not a matter of right of the appellants. It is not to be permitted in routine manner, and is permitted only in exceptional cases where it is inevitable and there are valid reasons for restoring the appeal.
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BACKGROUND
The appellant/assessee ha obtained an Advance Authorization for export of garments under the category of textile general and were entitled to import raw material which was to be used in the manufacture of the export products. The fabrics imported under the Advance Authorisation were being diverted by the importer for sale in the open market. The condition no. 14 of the Advance Authorisation which indicated the factory address for the processing of the imported raw material as Baddi, HP. But the imported fabrics never reached the factory .
The case was adjudicated by the Order-in-Original. Being aggrieved by the impugned order, the appellants had filed the appeals before the Tribunal. As no one had appeared for the appellant and the co-noticee, the Bench had proceeded to decide the case based on the appeal memorandum and accordingly Final Order was issued.
The appellant had filed the restoration application in respect of Final order.
ARGUMENT
The appellant’s counsel argued that the final hearing notice was not served, a new advocate could not be appointed earlier due to the co-noticee’s poor health, advocate Sh. G.G. Gupta was appointed on 23.08.2024, and a fair chance to argue the case should be given.
However, the Departmental Representative opposed the appeal restoration, citing six prior hearings where no one appeared, the limitation of three adjournments under Section 129B(1A) of the Customs Act, and Rule 21 of CESTAT Rules. The appellant has neither provided evidence nor denied the investigation’s findings.
FINDINGS OF CESTAT
The appellants failed to appear for multiple hearings, despite their advocate withdrawing the Vakalatnama in July 2023. While the first hearing notice was served, no new counsel was appointed, a full year later, even after the final order was issued. The daily order sheets and final order were regularly uploaded to the CESTAT website, as per Section 153 of the Customs Act, 1962, deeming them served.
The Tribunal observed that the appellant and co-noticee showed no diligence in pursuing the appeal, despite seven opportunities provided. Restoration of Appeal (ROA) is not a matter of right but permitted only in exceptional cases with valid reasons. The appellants failed to provide justifiable reasons for their absence across multiple hearings, and their delay in appointing counsel reinforces their lack of interest in prosecuting the appeal.
The appellant’s argument that the final hearing notice for 05.12.2023 was not served is untenable, as Section 153 of the Customs Act considers an order served upon being uploaded on the common portal. Therefore, the Tribunal rejected this claim, highlighting the appellant’s tardiness in following up on their appeal.
The final order, was decided on merits, taking into account the grounds of appeal in the memorandum and the submissions of the Revenue. It was not dismissed for lack of prosecution. The Supreme Court has clarified in CIT vs. Chennappa Mudaliar that tribunals must decide appeals on merits, not dismiss them due to the absence of the appellant.
Further, under the Proviso to Section 129B(1A) of the Customs Act, only three adjournments are mandated, yet the Tribunal provided seven opportunities. Rule 21 of the CESTAT (Procedure) Rules, 1982, empowers the Tribunal to pass ex-parte orders if the appellant fails to respond to repeated hearing notices. The appellants’ consistent absence justified the final order’s issuance without their presence.
Conclusion
The tribunal dismissed the ROA filed by the appellant and the co-noticee respectively.
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Case Details
Case Title: Himachal Fashion Private Limited Versus Commissioner Of Customs
Case No.: Customs Restoration Of Appeal Application No. 51943 Of 2024 In Customs Appeal No. 50671 Of 2021
Date: 08.11.2024
Counsel For Appellant: G.G. Gupta
Counsel For Respondent: S K Rehman
