Madras High Court Quashes Central Excise Order Passed Without Opportunity of Being Heard

Madras High Court Quashes Central Excise Order Passed Without Opportunity of Being Heard

The Petitioner had to be provided with an opportunity of personal hearing to defend their case, Court ruled

The Madras High Court quashed the order of the Additional Commissioner of Central Excise on the ground that the Petitioner had to be provided with an opportunity of personal hearing for the purpose of submitting the judgments, documents and the grounds raised to defend their case.

The matter titled T.M. Hotels Private Limited v The Additional Commissioner of Central Excise was placed before a single-judge Court of Justice S.M. Subramaniam in the High Court of Madras.

The Court did not go into the facts of the case and purely dealt with the Petitioner's right of being heard. The issue raised was that Respondent – Additional Commissioner of Central Excise passed an order without providing a personal hearing to the Advocate who represented the case of the Petitioner.

The Petitioner submitted that the Respondent sent a summons to the Petitioner directly and did not send one to the Petitioner's Advocate. The Petitioner submitted that they were under the bonafide impression that the Advocate will take care of the matter by appearing and defending their case. However, the Advocate could not appear before the authority as he was not aware of the summons as well as the date of personal hearing. This resulted in the passing of the final order without providing an opportunity to the Petitioner.

The Respondent contended that that summons are to be issued either to the person intended or his authorized agent as per Section 37C of the Central Excise Act, 1944. The Respondent further submitted that the summon admittedly was issued to the Petitioner and it was the Petitioner's duty to inform the date of personal hearing to his Advocate who was appearing in the matter and therefore, the Respondent could not be faulted for the lapses committed by the Petitioner.

The judge observed that in certain circumstances, the Courts are bound to consider whether the denial of opportunity caused certain prejudice to the interest of the person aggrieved.

The bench noted the possibility that the Petitioner could not have informed about the summons to their Advocate regarding the personal hearing, which resulted in the passing of the final order without hearing the Petitioner's Advocate.

The Court opined that the Petitioner had to be provided with an opportunity of personal hearing for the purpose of submitting the judgments, documents and the grounds raised to defend their case.

Therefore, the Court quashed the order of the Respondent and remanded the matter back for fresh reconsideration.