DCW Limited vs Collector of C. Ex.

Notice of motion has been ordered by Sivasubramaniam, J. on 8-9-1988. When the Writ Miscellaneous Petition came up for hearing, by

consent of both parties, the main writ petition itself is taken up for final disposal, after admitting the writ petition.

The petitioner herein seeks a writ of certiorarified mandamus to call for the records from the respondent of the impugned order in C.No.

V/14G/15/14/82-CX. 3, dated 10-6-1988 and after quashing the same to direct the respondent to afford reasonable opportunity to the petitioner

to make representations on merits.

W.M.P. No. 17538 of 1988 is filed to amend the prayer as follows :

...to issue a writ of certiorarified mandamus, or other appropriate writ, order or direction, to call for the records of the respondent in No.31/88,

issued in C.No. V/14G/14/82 CX-3, dated 10-6-1988 and quash the same and direct that the petitioner be afforded a reasonable opportunity to

make representations on merits and adjudication taken up afresh by the Principal Collector or Central Excise or some other Collector of Central

Excise of equivalent rank as the respondent and render justice.....

The facts of the case are:

The petitioner company is manufacturing Hydrochloric Acid (HCl) falling under Item 14 of the Tariff. A show cause notice was issued on 12-5-

1983 by the Collector of Central Excise and Customs, Madurai for adjudication on the ground that the assessee Central Excise and Customs,

Madurai for adjudication on the ground that the assessee had contravened the provisions of Rule 9(1), 173B, sub-rule (1), (2)(ii) & 10 of Rule

173C, read with Rule 173F and 173G of the Central Excise Rules, 1944. The petitioner was directed to give the representation and he was asked

to indicate in the representation whether the case has to be heard in person for adjudication, and it further stated that if no cause is shown against

the action proposed to be taken within 30 days of the receipt of the said notice, the case will be dicided ex parte. The petitioner replied on 22-6-

1983 termed as `Preliminary reply'' raising two grounds namely, the Collector has no jurisdiction to decide the issue and the demand is hit by

limitation. The petitioner sought for orders on these two objections. The objections raised by the petitioner/company were considered and they

were informed on 5-3-1984 that their request for a decision on their preliminary objections was not acceded to. The petitioner company was

clearly requested to argue its case on merits and that its preliminary objections would be duly considered while deciding the case. The petitioner

filed W.P.No.9566 of 1984 before this Court and obtained an interim stay of further proceedings on 27-9-1984. The department filed

W.M.P.No. 6665 of 1985 to vacate the stay granted in W.M.P.No. 15388 of 1984 in W.M.P.No. 9566 of 1984 and Mohan, J. (as he then

was) passed the following order on 29-7-1985.

In the counter affidavit of the Collector of Customs, in paragraph 5 it is stated as follows :

The respondent is willing to hear the petitioners in the matter of preliminary issue and make a speaking order setting out the basis and reasons for

his decisions on the preliminary issues.

Recording this, the interim injunction is vacated W.M.P.No. 6665/85 allowed and W.M.P.No. 15388/84 dismissed.

A personal hearing was given to the petitioner on 19-9-1986 and the respondent, the then Collector of Central Excise, Madurai passed an order

on 24-4-1987. Against that order, the petitioner filed an appeal before the Customs, Excise & Gold (Control) Appellate Tribunal, (briefly called as

CEGA'') Madras and it was dismissed on 31-12-1987. The said order was received by the petitioner company on 10-2-1988. The Tribunal in its

order dated 31-12-1987 agreed with the findings of the Collector of Central Excise, Madurai and left it to the petitioner company to pursue with

the case on merits before the Collector. After the receipt of the Tribunal''s order by the petitioner company, the petitioner company were called

upon to argue their case on merits and a personal hearing was fixed on 15-4-1988. It was adjourend twice at the request of the petitioner. In the

meantime, the petitioner filed a Reference Application No.E/36/MAS/88 on 21-3-1988 u/s 35(K) of the Central Excises and Salt Act, 1944 to

the Tribunal and it is pending. W.P.No.3467 of 1988 was filed on 28-3-1988 by the petitioner company to restrain the respondent from

proceeding further with the show cause notice. On 8-4-1988, notice to respondent was ordered in W.P.No.3467 or 1988. On 20-4-1988 the

learned counsel for Department gave an oral undertaking before Sivasubramaniam, J. that the respondent would not proceed with the matter.

However, it seems the Writ Petition No.3467 of 1988 was dismissed by Sivasubramaniam, J. on 8-9-1988 as withdrawn. On 11-5-1988 a notice

was issued to the petitioner company calling for the personal hearing on 6-6-1988. On 3- 6-1988, the petitioner company requested an

adjournment, by way of a telegram. On 6-6-1988, the respondent fixed the personal hearing of the petitioner company to be heldon 10-6-1988

(Friday) at 3.00 p.m. and intimated the same to the petitioner by way of a telegram. It seems one of the senior Counsel of this Court, Mr. S.V.

Subramanian appeared before the respondent on 10-6- 1988 and sought for an adjournment. It was refused and arguments were heard and the

case was closed at 5.00 p.m. on the same day. It is stated before this Court that the learned Senior Counsel asked for time to file a written

representation by 12-6-1988, since 11-6-1988 and 12-6- 198 happened to be Saturday and Sunday. But an order dated 10-6-1988 was served

on the petitioner by a special messenger at 8.00 a.m. on 13- 6-1988. On 13-6- 1988 by 10.00 a.m. the written representation was handed over in

the office of the respondent as undertaken by the learned counsel. As such, this writ petition is filed by the petitioner to quash the order passed by

the respondent on 10-6-1988 with the prayers as stated supra.

A detailed counter affidavit has been filed by the Department referring to various provisions under the Central Excises and Salt Act, 1944,

especially Section 35B, 35G(1), 35G(3), 35L(B) and 35L to show the alternative remedies prescribed under the said Act, which the petitioner

ought to have exhausted. It is further stated in the counter affidavit that the undertaking given by the Department on 30- 4-1988 by the learned

counsel for the Department was withdrawn by serving a letter upon the counsel for petitioner. It is further stated in the counter affidavit that the

counsel has informed the petitioner that the counsel for Department intends to proceed with the case and requested the counsel for petitioner to

move the case before vacation Court. It is claimed in the counter-affidavit that no request was ever made by the senior counsel for petitioner

company on 10-6-1988, with regard to filing of the written representation as stated by the petitioner. It is further stated that if such a request was

ever made by the senior counsel for petitioner, it is the usual procedure to note it down in the personal hearing records. It is further claimed that no

such request was noted down. It is further claimed that the said order was passed on 10-6-1988 itself and it is stated in the counter-affidavit as

follows :

....The brilliance of the Collector can be easily seen from the order which is dictated by him; duly corrected by him which was typed out on the

same day.

It is claimed that four hearings were given to the counsel for petitioner before 10-6-1988. The written representation was received by the Junior

Personal Assistant on 13-6-1988 at 10.00 a.m. He was not in any way connected with the adjudication proceedings. However, the same was

brought to the notice of the respondent and the respondent made an endorsement as ""belated receipt"". It is further claimed in the counter affidavit

that the petitioner is guilty of non-cooperation and that he is interested in dragging out the issue beyond reasonable time. It is further stated in the

counter-affidavit that if really the petitioner is interested in disposing of the matter he could have utilised these five years from 1983 for preparing a

lengthy written representation,which could have been submitted. The reason given in the counter-affidavit for the refusal to grant any further time is

as follows :

If a person cannot prepare a written reply in a period of five years such a personal will never prepare any reply even after any length of further

time...

Mr. V.P.Raman, the learned counsel appearing for the petitioner contends, without going into the merits of the case, that no proper opportunity

is given to the petitioner and that the principles of natural justice are violated. The learned counsel further submits that the facts itself will show that

the respondent was not prepared to wait till Monday morning i.e. on 13-6-1988, to receive the written representation from the petitioner company

and then pass orders. The learned counsel further states that he is surprised by the attitude shown by the respondent and submits that the matter

has to go back for proper consideration on merits taking into consideration the written representations submitted by the petitioner on 13-6-1988.

The learned counsel states that he is ready to undertake that the petitioner will not take further adjournment and the matter can be disposed of in a

time-bound schedule. The learned counsel further submits that though he originally wanted only the remit of the matter, after seeing the tenor of the

counter-affidavit a prayer is now made that the matter may be heard by some other officer. The sum and substance of the argument of the learned

counsel for petitioner is that since the respondent has pre- judged the matter, it is better in the interests of justice that the matter may be ordered to

go back before some other officer which is permitted under Rule 25 of the Central Excise Rules.

The learned Advocate General, appearing for the Department contends that the matter was fully heard on 10-6-1988 and the senior Counsel

represented the petitioner. No question of giving written representation on the facts of this case arose, because the petitioner had already given the

written representations even as early as 30-9- 1986. It is submitted by the learned Advocate General that there is no necessity for filing any written

representation or written arguments to decide the matter. The learned Advocate General further contends that a writ petition is not the proper

remedy at this stage, especially when the adjudication has been made, and that the petitioner has to approach the Tribunal primarily. With regards

to the contention of violation of principles of natural justice, the learned Advocate General strenously argues that there is no violation of principles

of natural justice on the facts of this case because fair and full opportunity was given to the petitioner and that the order was passed on 10-6-1988

because the Revenue was interested in disposing of the said petition since the matter was pending more than six years. The learned Advocate

General relies upon an unreported decision of a Division Bench of this court in W.A.No. 257 of 1988 (M/s. Z. Raja Reddi Factory, Gudiyatham

v. The Collector of Central Excise, Madras and Others) with regard to the scope of Section 35G of the Central Excises and Salt Act, 1944 and

submits that the writ petition is not maintainable at this stage. He further contends that there is no necessity to go before another officer as no

personal animosity or bias is alleged against the officer, who passed the impugned order.

Mr. V.P.Raman, the learned counsel for petitioner brings to my notice the decision in A.V. Venkateswaran, Collector of Customs, Bombay Vs.

Ramchand Sobhraj Wadhwani and Another, whether the Principle of alternate remedy applies in cases of violation of principles of natural justice

and submits that the reply given to the show cause notice in the year 1986 was only on the question of jurisdiction and limitation, that no reply was

given on merits at that time and that the reply on merits is given only now. The learned counsel further contends that a reading of the counter

affidavit itself will show that it is a fit matter to go before some other Collector and that he is prepared to face any other officer other than the

officer who has passed the present impugned order.

I have given careful considerations to the arguments advanced by both, Mr. V.P.Raman, the learned counsel for petitioner and the learned

Advocate General, for the respondent.

The short point that arises for consideration is whether the principles of natural justice have been violated on the facts and circumstances of this

case.

The Supreme Court had an occasion to consider the applicabity of the principles of natural justice in a recent case in R.S.Dass v. Union of

India AIR 1967 S.C.593. The Supreme Court in The Chairman, Board of Mining Examination and Chief Inspector of Mines and Another Vs.

Ramjee, held as follows :

Natural justice is no unruly horse, no lurking land mine, nor a judicial cure-all. If fairness is shown by the decision maker to the man proceeded

against, the form, features and the fundamentals of such essential processual propriety being conditional by the facts and circumstances of such

situation, no breach of natural justice can be complained of. Unnatural expansion of natural justice, without reference to the administrative realities

and other factors of a given case, can be exasperating. We can neither be finical or financial but should be flexible yet firm in this jurisdiction......

It has been held in A.K. Kraipak and Others Vs. Union of India (UOI) and Others, that the concept of natural justice has undergone a great deal

of change in recent years and observed as follows :

What particular rule of natural justice should apply to a given case must depend to a great extent on facts and circumstances of that case, the

frame work of the law under which the enquiry is held and under which the enquiry is held and the Constitution of the Tribunal on the body of

persons appointed for that purpose.

Considering all these cases, the Supreme Court in R.S. Dass Ors. Vs. Union of India (UOI) and Others, observed as follows :

Rules of natural justice are not rigid rules, they are flexible and their application depends upon the setting and the background of statutory

provision, nature of the right which may be effected and the consequences which may entail its application depends upon the facts and

circumstances of each case. These principles do not apply to all cases and situations. Applications of these uncodified rules are often excluded by

express provision or by implication.

The Supreme Court in Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, which arose under the Orissa Sales Act,

1947 held as follows :-

Merely because the Sales Tax Officer refused to grant any further adjournments and proceeded to make best judgment assessment, it could not

be said that he acted in violation of the rules of natural justice. The question whether another adjournment should have been granted or not was

within the discretion of the Dales Tax Officer and was a matter which could properly be raised only in an appeal u/s 23(1) of the Act and that the

Act provided for a complete machinery to challenge an order of assessment and the orders of assessment in the case could only be challenged by

the mode prescribed by the Act and not by a petition under Article 226 of the Constitution.

The unreported decision of the judgment of the Division Bench of this Court in W.A.No. 257 of 1988 (M/s. Z. Raja Reddy Factory, Gudiyatham

v. The Collector of Central Excise, Madras and Others) dated 2-3-1988, relied upon the learned Advocate General, squarely applies to the facts

of this case and the Division Bench in that case observed as follows :-

.......The Tribunal has necessary jurisdiction to decide all questions of law and fact. If inspite of approaching the Tribunal, the appellant is in any

manner aggrieved on a question of law, he can seek a reference to this Court. The Act having conceived of a particular manner of remedy, no valid

ground is made out to entertain the writ petition in spite of such effective remedies conceived of under the Act......

In this case, it is not disputed that the petitioner''s counsel was heard on 10-6-1988. The only grievance of the petitioner seems to be that time

was not given for submitting the written representations. In my view, whether to give an adjournment or proceed with the hearing is purely a matter

of discretion vested with the Presiding Officer. In this case, the hearing was over on 10-6-1988 at 5.00 p.m. and the impugned order was dictated

by the Officer, who heard the case, on the same day itself. In view of this, the written representations submitted on 13-6-1988 is of no use.

In these circumstances, I am of the opinion that the ratio of the Supreme Court in the decision reported in Titaghur Paper Mills Co. Ltd. and

Another Vs. State of Orissa and Others, squarely applies to the facts of this case. In that case also, a complaint was made with regard to the

refusal of a grant of an adjournment and the Supreme Court held that the question regarding the adjournment of a matter was also a matter which

has to be raised, only in an appeal provided under that Act. So also the ratio of the unreported decision of the Division Bench of this Court in

W.A. No. 257 of 1988 (M/s. Z. Raja Reddy Factory, Gudiyatham v. The Collector of Central Excise, Madras and Others) squarely applies to

the facts of this case. It is open to the petitioner to raise the question of violation of principles of natural justice also before the Tribunal, as held by

the Supreme Court and the Division Bench of this court. I am of the view that since the petitioner has got alternative remedies provided under the

Act, this writ petition is not maintainable. As such, I am not inclined to interfere with the impugned order.

In the result, the writ petition stands dismissed with costs. Counsel''s fee Rs.1,500/- (Rs. One thousand and five hundred only) this matter

having been posted today for being mentioned in the presence of Mr. V.P. Raman for M/s. T.K. Ramkumar and P.S. Raman, Advocates for the

petitioner and of Mr. R. Krishnamurthi, Advocate General for Mr. N. Jothi Addl. Central Standing Counsel on behalf of the respondent, the court

made the following order :-

The matter is being posted today ""for being mentioned at the request of the counsel for the petitioner yesterday. Now the learned counsel for the

petitioner says that nothing further to be done. As such no further orders are necessary.