1. This is an Application said to be under Rule 20 of the Appellate Tribunal (Procedure) Rules, 1982, for restoration of a proceeding under Section 131 of the Customs Act, 1962, (hereinafter, the Act), as it read at the material time, transferred to be heard by the Tribunal as an Appeal, (No. 1311/82-NRB) pursuant to Section 131B (2) of the Act, and dismissed for the failure of the Appellant to comply with the directions of the Tribunal for discovery and production of certain documents at the instance of the Respondent (Order No. 12/84-NRB).
(a) in consequence of an Order-in-Appeal No. 137/82 dated 15-3-1982 made by the Central Board of Excise and Customs, a notice under Section 131 of the Act, as it read at the material time, was issued requiring the Respondent to show cause as to why the Order-in-Appeal should not be revised. On transfer of the proceedings pursuant to the said notice, in terms of Section 131B (2), the matter came to the Tribunal to be heard as an Appeal. The Applicant herein was the Appellant ; (b) although, the Appeal was to have been beard by the Calcutta Bench of this Tribunal, it was transferred to the North Regional Bench on the orders of the Hon'ble President dated 24-3-1983, wherein he was pleased to direct that the Appeal should be fixed for an early hearing ; (c) the Respondent applied for the production of three documents and when the Appeal came up for hearing on 21st June, 1983, the Bench was pleased to direct either the production thereof or, in the alternative, a statement of the Applicant's objections for their production on the next date of hearing fixed for 22nd August, 1983.
The Bench observed that failure to produce the documents, or, in the alternative, file objections to the production thereof may entail an ex-parte decision. Further directions were given by the Bench to the effect that no other case is to be fixed for 22-8-1983 and the record of the Appellant should be available on that day. The Respondent's undertaking not to ask for an adjournment on that day for the hearing of his Application as well as the Appeal was also recorded ; (d) after hearing the Application for production on 22-8-1983, an order was made that the documents should be supplied to the Respondent by the Applicant within four weeks of the receipt of the Order of the Tribunal by him (Para 14 of the Order No. 509/83 of the North Regional Bench of the Tribunal dated 26-9-1983) ; (e) consequent upon the failure of the Applicant to comply with the aforesaid Order of the Tribunal, the Respondent moved an Application dated 14-1-1984, praying for the dismissal of the Appeal itself for non-compliance with the Order of the Tribunal. The said Application was directed to be listed for hearing on 15-2-1984 and, accordingly, a notice was issued on 31-1-1984 to the parties fixing the hearing on 15-2-1984 ; (f) on 15-2-1984, when the Appeal was taken up for hearing, it was submitted for the Applicant that a copy of the Application for dismissal of the Appeal in consequence of his failure to comply with the directions issued was not received although notice of the hearing of the Appeal itself was received. The order for production dated 26th September, 1983, was received by the Applicant/Appellant during the 3rd week of November and it had taken some time for despatching the files from here to Bhubaneswar at his request ; (g) in the aforesaid facts and circumstances of the case, it was decided by the Tribunal that the Appeal itself should be dismissed, inter alia, for the following reasons :- "Right from the beginning, it will be observed that it has been the desire of the Tribunal to hear and dispose of the instant Appeal as expeditiously as possible. This was why originally the Hon'ble President directed that it should be fixed for an early hearing.
This was also the reason why the North Regional Bench had, on 21-6-1983, directed that no further adjournment should be sought in this case and all papers necessary should be obtained on pain of an ex-parte decision. The Departmental Representative was further directed to keep the record of the case available with him on 22-8-1983 when the matter was coming up for hearing. Notwithstanding this and despite the grant of time for four weeks from the date of the receipt of the order and expiry of a further period of more than 50 days, we find that the documents have not yet been produced. Nor has the Appellant or his Departmental Representative applied for extension of time for production of the documents at any time after the expiry of four weeks from the date of the receipt of the Order dated 26-9-1983. The Appellant as well as his Departmental Representative cannot plead ignorance of the orders that are made by the Tribunal from time to time. If any delay beyond the time granted for production of documents was anticipated or the direction of the Tribunal could not be complied within the time granted, it behoves the Appellant or his Representative to apply for extension of time rather than wait for such steps as the Respondent may take in the matter.
In the circumstances of the case, we are clear in our minds that the Appellant had, to his knowledge, transgressed the directions of the Tribunal. Having done so, there is hardly any merit in saying that no copy of the instant Application was received and this despite notice that the Appeal itself was to be heard on 15-2-1984.
Indeed, there was nothing to prevent the Departmental Representative from making available copies of such documents as were with him on 22-8-1983 itself, seeing that the file should have been with him on that day pursuant to the earlier directions of this Tribunal on 21-6-1983. There was hardly any necessity for despatching the files to Bhubaneswar.
Without going to the extent of saying that the conduct of the Appellant or his Departmental Representative amounted to contumacious disregard of the Orders of the Tribunal from time to time, we still find that the failure to abide by the said orders justifies the dismissal of the Appeal itself. We accordingly do so." (h) the instant Application was filed alongwith an Application for Reference of some questions of law said to arise from our aforesaid Order (No. 12/84-NRB). The Application for Reference was dismissed by our Order No. R. 17/84-NRB, dated 10-7-1984. It was submitted at the Bar that no further Application under Section 130 (3) of the Act, in the High Court of Orissa, had been filed against our dismissal of the Reference Application.
(a) the Order No. 509/83-NRB, dated 20-9-1983 was received by the Appellant's office on 24-10-1983. But then, the records of the case were with the Senior Departmental Representative in New Delhi. He did not return the records on his own as he ought to have. Nor did the dealing officer in the Appellant's office call for the records for compliance with the Tribunal's Order ; (b) however, on a reference to the Appellant by his subordinate officials on the question of an Appeal against the Order, he directed on 18-11-1983 that the Orders of the Tribunal have to be complied with ; (c) it was then that the records were called for from the Senior Departmental Representative in New Delhi and they were actually received in the Appellant's office on 17-12-1983 ; (d) the search and location of the documents required to be produced- in particular a report or record of reasons that culminated in a search warrant against the Respondent which ultimately could not be traced-took some time and it was only on 15-2-1984 that the Appellant could despatch by Registered Post to the Respondent copies of such of the documents as were available ; (e) meanwhile, it was expected that the Senior Departmental Representative would have made appropriate requests for extension of time for production of the documents ; (f) in the aforesaid facts and circumstances, there was neither any disregard or even intent to disregard the order of the Tribunal, since the documents available had been ultimately supplied to the Respondent. The Appeal may be restored and heard condoning the lapses and default of the Appellant or the Senior Departmental Representative, if any ; (g) some important questions of law are involved in the Appeal which, unless decided by the Tribunal, would have wider repercussions and impact ; (h) non-service of the Respondent's Application dated 14-1-1984 (praying for dismissal of the . Appeal for Appellant's failure to comply with the Order of the Tribunal dated 26-9-1983-No.. 509/83) and the eventual dismissal of the Appeal itself, accordingly, amounted to denial of the principles of natural justice ; (i) there is no provision for dismissal of an Appeal for default apart from Rule 20 of the Customs, Excise & Gold (Control) Appellate Tribunal (Procedure) Rules, 1982 (hereinafter, the Rules) and, accordingly, the dismissal of the Appeal for non-compliance with the Tribunal's Order was incorrect.
4. Before us, Shri Lakshmikumaran appearing for the Appellant, while conceding that Rule 20 of the Rules did not apply and cannot, therefore, be invoked for maintaining the instant Application, submitted, that the Application was, still, maintainable and may be allowed for the following reasons :- (a) The disposal of the Appeal itself was not in accordance with the provisions of Section 129-B of the Act, inasmuch as the Appellant was not afforded any opportunity to be heard in regard to it. In other words, the Appellate Tribunal had no jurisdiction to have dismissed the Appeal without affording an opportunity to the Appellant to be heard and, accordingly, the erroneous Order of dismissal may be recalled.
(b) Nor could the Appeal be dismissed without a decision on merits in terms of the aforesaid provision. [Reliance upon AIR 1969 SC 1068-The Commissioner of Income-tax, Madras v. S. Chenniappa Mudaliar, construing a parallel provision in Section 33(4) of the Income-tax Act, 1922.
(c) Indeed, there is no provision empowering the Tribunal to dismiss the Appeal for non-compliance with its orders. If there is any such power, the self same power be invoked to restore the Appeal now that the order had been complied with and the documents produced.
(d) In any view of the matter, the Tribunal's directive was merely procedural and in aid of justice and not substantive justice itself.
The dismissal of the Appeal itself for failure of the Appellant to act in terms of the directive is disproportionate to the gravity of the lapse or omission. [Reliance on AIR 1983 SC 876-Kalipada Das v. Bimal Krishna Sen Guptha.
5. The Application was stoutly resisted by the Respondent. On his behalf, it was submitted by S/Shri Nargolwala and Jayant Dass that- (a) the dismissal of the Appeal was not for Appellant's default in appearance but his failure to act in terms of the Order of the Tribunal in the matter of discovery, inspection and production of documents. In the circumstances, there is no provision for its restoration and the Application is not maintainable ; (b) the Appellant is not an "aggrieved person", so as to be able to file an Appeal or an Application for its restoration on its dismissal, in terms of Section 129A of the Act. Nor could the Appellant be aggrieved by an Order of the Board in allowing the Appeal of the Respondent ; (c) the Application is a gross abuse of the process of this Hon'ble Tribunal in the facts and circumstances of the case ; (d) the Applicant, having, admittedly, received the Order of this Tribunal [Older No. 509/83, dated 26-9-1983] on 24-10-1983, defaulted in the production of the documents for more than two-and-half months thereafter and now thinks it fit to blame his subordinates and the Departmental Representative for his own lapses and, accordingly, hardly deserves the relief of restoration of the Appeal ; (e) it is not correct to say that the Tribunal is without any power to dismiss an Appeal for failure to comply with its directions for discovery and production of document. Reference is invited to Section 129C(7) of the Act under which the Tribunal has all the powers of a Civil Court in regard to discovery and inspection.
6. On a perusal of the papers in the Tecord, and the submissions made and otherwise, it would appear to us that- (a) indisputably, the Tribunal is vested with all the powers of a civil court in respect of- (ii) compelling the production of books of account and other documents [S. 129C(7)] ; (b) the power of a civil court in the aforesaid matters extends to dismissal of the suit or the striking out of the defence, as the case may be, of a party to the suit failing to comply with an order/direction of the court in this regard, if the court is satisfied that the documents are wilfully or obstinately or contumaciously withheld or the party who is to comply with the directive is "guilty of inordinate and inexcusable delay which may cause substantial or serious prejudice to the opposite party". [AIR 1978 SC 1436- Babbar Sewing Machine Co. v. Trilok Nath Mahajari (c) when there was failure to comply with the direction of the court, no satisfactory reason furnished for such failure and no application had been made for extension of time within which the direction has to be complied with, it had been held in AIR 1976 MP 175 [State v. Sunderlal] that the default in compliance was wilful; (d) the circumstances are not different in this case as set forth in para 2(g) supra. It is clear, in the facts and circumstances of the case, that the failure to comply with the Tribunal's Order was wilful and the Applicant was "guilty of inordinate and inexcusable delay" which was intended to cause substantial or serious prejudice to the Respondent in the hearing of the Appeal, if not contumacious disregard for the direction for discovery and production. Even after notice of the hearing of the Appeal for 15-2-1984 was received on 31-1-1984, there was no attempt on the part of the Applicant to apply for extension of time within which the direction of the Tribunal has to be complied with ; (e) on top of this, the Applicant attributes the delay and the failure to apply for extension of time to the subordinates in his office or to the Departmental Representative ; (f) (i) but then, the question arises, if the dismissal of the Appeal itself for the Applicant's wilful failure to comply with the direction of the Tribunal was unwarranted, in terms of Section 129B (1) of the Act, inasmuch as, according to the Applicant, he was neither heard in the Appeal nor was the disposal of the Appeal on merits, as it should have been in terms of the aforesaid provision That is as much as to say-the Appeal has, necessarily, to be heard on merits regardless of the power conferred on the Tribunal for wilful disregard of its direction for discovery and production. The power of dismissal for failure to comply with such a directive remains a dead letter and whether or not the directive has been complied with, the Appeal has still to be disposed of OP merits and not dismissed for such failure. The Applicant relies upon the decision of the Hon'ble Supreme Court in AIR 1969 SC 1068 [The Commissioner of Income-tax v. S. Chenniappa Mudaliar (ii) this was not an issue raised in the hearing before us earlier when the Appeal itself was dismissed. Our attention was drawn to AIR 1969 SC 1063 only now when, as will appear below, we are powerless to restore the Appeal dismissed for failure to comply with the directions of the Tribunal, except by resort to the maxim "Actus curiae neminem gravabit", if at all applicable ; (iii) further, while it is, undoubtedly true, that the Hon'ble Supreme Court in the aforesaid decision, construing Section 33(4) of the Income-tax Act, 1922, observed (in para 6 of the report of the judgment) that "the scheme of the provisions of the Act relating to the Appellate Tribunal apparently is that it has to dispose of an Appeal by making such orders as it thinks fit on the merits", it cannot be overlooked that these observations were made in the context of a Rule (Rule No. 24) framed by the Income Tax Appellate Tribunal itself for dismissal of an Appeal for a default in appearance on the date fixed for hearing, rather than for dismissal, in exercise of its powers co-equal with that of a civil court, in terms of Section 37 of that Act, introduced with effect from 1-4-1956 and in pari materia with Section 129C(7) of the Customs Act, 1962. That this was so appears also from the observation lower down in para 7 that the aforesaid Rule comes into conflict with Sub-section (4) of Section 33 and "in the event of repugnancy between the substantive provisions of the Act and a Rule, it is the Rule which must give way to the provisions of the Act".
(iv) a decision is an authority for the point it decides rather than what can be deduced from it [AIR 1963 SC 151-Somawanti v. State of Punjab] ; (v) it may be observed, with the utmost respect, that the aforesaid decision cannot be so read or construed as to negate the powers, co-equal with those of a civil court, conferred on the Tribunal statutorily, in terms of Section 37 of the Income Tax Act, 1922 : S.C. 129C(7) of the Act. It cannot be the intent of the aforesaid decision to render Section 37 of the Income Tax Act : S. 129C (7) of the Act altogether nugatory, which would be the case, if, notwithstanding the aforesaid provision, the Tribunal cannot enforce its direction in any of the matters enumerated therein, by dismissal of the Appeal, where necessary, in a case of wilful failure in compliance, the way a civil court could, but has to decide the Appeal on merits; (vi) by parity of reasoning, one may contend that while a Collector (Appeals) can reject an Appeal in consequence of the Appellant's failure to comply with the requirements of a deposit in terms of Section 129F of the Act (or Section 35F of the Central Excises and Salt Act, 1944) by virtue of the omission of the word "thereon" in Section 128A(3) of the Act : S. 35A(3) of the Central Excises and Salt Act, 1944],and on the authority of AIR 1971 SC 2280 (Navin Chandra Choteylal v. The Central Board of Excise and Customs-construing the parallel provisions in Ss. 128 and 129 of the Act, as they read previously-the old Section 128(2) in so far material is verbatim the same, as the new Section 128A(3)], the Appellate Tribunal cannot do so and has, necessarily, to decide the Appeal on merits. Such a contention, apart from introducing an unintended incongruity in the powers of the Tribunal vis-a-vis the Collector (Appeals), renders the statutory requirement of a deposit as a condition precedent for the hearing of the Appeal before the Tribunal altogether nugatory.
(vii) in the result, we are unable to agree with the contention advanced for the Applicant that, the Tribunal could not have dismissed the Appeal for the Appellant's failure to comply with the directions of the Tribunal in terms of Section 129C(7) of the Act ; (viii) while on the subject, it may be mentioned that it is not also without significance that under Section 255(6) of the Income Tax Act, 1961, the powers of the Appellate Tribunal in matters of discovery, inspection and production of documents are restricted to those of an Income Tax Officer under Section 131 and not co-equal with that of a civil court as in terms of Section 37 of the Act of 1922 or Section 129C(7) of the Act. In terms of Section 131, the Income Tax Officer can only levy a fine not exceeding Rupees Five Hundred for failure to comply with the directions for production of documents, for in the nature of the proceedings, there cannot be a dismissal of assessment proceedings. The Tribunal has not been vested with powers of larger amplitude to dismiss the Appeal itself for such non-compliance ; (g) when the Appeal was dismissed in terms of the aforesaid provision, obviously it was not an order made under Section 129B and there can, therefore, be no question of hearing the Appellant in the Appeal ; (h) (i) admittedly, the Tribunal is not vested with any power of restoration of a dismissed Appeal other than Rule 20 of the Rules and that Rule does not apply in the facts and circumstances of the case ; (ii) the contention that the Appeal may be restored by exercising that very power which enabled the Tribunal to dismiss the Appeal in 1he first instance is rather naive, if one may say so ;Kalipada Das v. Bimal Krishna Sen Guptha], in cur respectful opinion, is inapplicable to the facts and circumstances of the case and in the context of the statutory provisions that enable the Appeal itself to be dismissed for contravention of directions for discovery and production of documents ; (j) even so, originally, when the Application of the Respondent dated 14-1-1984 to dismiss the Appeal for failure to comply with the directions of the Tribunal was filed, a direction was given to list it for hearing on 15-2-1984. Instead of listing the Application for a hearing, the Appeal itself was listed fora hearing on 15-2-1984 by a notice dated 31-1-1984, and we, accordingly, proceeded to dispose of the Appeal itself ; (k) in terms of O. 11, R. 24, as; amended in 1976, it is a mandatory requirement that a notice on the Application dated 14-1-1984 for dismissal of the Appeal for failure to comply with the directions of the Tribunal should have issued. The amendment made in 1976 was not brought to our notice on 15-2-1984 or subsequently ; (1) the notice issued on 31-1-1984 for the hearing of the Appeal itself was not only misleading but an erroneous act that undoubtedly caused prejudice to the Applicant. The dismissal of his Appeal left him without any remedy by way of a further Appeal; (m) (i) this being so, restitution in integrum to undo, rectify and act in restitution-on account of an erroneous act of the Tribunal by which prejudice is caused to the Applicant is the bounden duty of the Tribunal-"Actus curiae neminem gravabit" ;(Jang Singh v. Brijlal) it was laid down applying the maxim, that- 'There is no higher principle for the guidance of the court than the one that no act of court should harm a litigant and it is the bounden duty of court to see that, if a person is harmed by a mistake of the court, he should be restored to the position he would have occupied, but for the mistake'; (iii) again, in 1970(1) SCC 573 : (1971) 1 SCJ 180 : 1970 ALJ 1213-Jagannath Singh v. Ram Naresh Singh the Hon'ble Supreme Court had occasion to observe, following the aforesaid maxim, that an omission to mention a case correctly in the cause list was a mistake of the court itself and some indulgence was, therefore, to be shown, since an act of court should harm no person ; (iv) the Respondent cannot claim a vested right in such a mistake (1978 CrLJ 1184-Gauhati) ; (v) nor can the Rules of the Tribunal come in the way of such restitution. The dismissal of the Appeal was not conclusive or immutable where restitution becomes inevitably necessary and the order of the dismissal, in consequence, has to be recalled and set aside. It is not as if the Tribunal becomes denuded of any such power where such restitution is imperative ; (n) as discussed by us, in the case in 1984 (18) E.L.T. 310 [Entremonde Polycoaters v. Collector of Central Excise], restitution in integrum on account of an erroneous act of the Tribunal by which prejudice is caused to a litigant is different from a Review. In directing such restitution, we are not exercising any powers of Review.
7. Accordingly, after the most anxious deliberation of this matter, we recall the order of dismissal of the Appeal, restore it to its original number to be proceeded with at the stage it was on 15-2-1984.