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Smt. Prativa Rani Samanta Vs. Collector of Central Excise - Court Judgment

LegalCrystal Citation
CourtCustoms Excise and Service Tax Appellate Tribunal CESTAT Calcutta
Decided On
Reported in(1984)(15)ELT482Tri(Kol.)kata
AppellantSmt. Prativa Rani Samanta
RespondentCollector of Central Excise
Excerpt:
.....the said order has become final against them'-was not correct as shri biswaranjart maity and shri mrinal kanti maity filed separate appeals before appellate-collector of customs against the order dated 26-3-82 passed by the deputy collector of central excise (gold), calcutta confiscating the ornaments and imposing penalty on them. the said appeals were disposed of under order no. cal-cex-13, 13a/82 dated 24-1-83 in appeal case no. s5-1201/82cap/ gc by the collector (appeals), customs. further, being aggrieved by the order passed by collector (appeals), customs, both shri biswaranjan maity and shri mrinal kanti maity submitted separate appeals before the customs, excise and gold control appellate tribunal on 28-4-83 also. (b) the findings and observations of the tribunal at para 10.....
Judgment:
1. Smt. Prativa Rani Samanta, w/o Shri J.N. Samanta, Naikuri, P.O.Tamluk, Dt. Midnapore bad filed an appeal before this Tribunal being aggrieved from the order-in-appeal No. S 5-1510/82CAP/GC dated 2-12-82 passed by the Collector (Appeals) Customs, Calcutta. The said appeal was registered in the Registry vide Appeal No. GD(T) CAL-8/83 and the same was disposed of vide this Tribunal's order No. 65/Cal/83-732 dated 7-4-83. The said appeal was rejected by this Tribunal. Being aggrieved from the said order dated 7-4-83, the appellant has filed a petition for rectification/modification dated 6-6-83 supported with an affidavit on a non-judicial paper sworn before a Notary Public.

2. The appellant in her petition dated 6-6-83, has pointed out the following mistakes in para 2 of the petition which are reproduced as under : ' "(a) The findings and observations of the Tribunal in the last paragraph 4 of its order-'Sarvashri Biswaranjan as well as Mrinal Kanti did not challenge in any way the order passed by the Deputy Collector confiscating the ornaments and imposing a penalty on them.

In this manner, the said order has become final against them'-was not correct as Shri Biswaranjart Maity and Shri Mrinal Kanti Maity filed separate appeals before Appellate-Collector of Customs against the order dated 26-3-82 passed by the Deputy Collector of Central Excise (Gold), Calcutta confiscating the ornaments and imposing penalty on them. The said appeals were disposed of under order No. Cal-Cex-13, 13A/82 dated 24-1-83 in appeal case No. S5-1201/82CAP/ GC by the Collector (Appeals), Customs. Further, being aggrieved by the order passed by Collector (Appeals), Customs, both Shri Biswaranjan Maity and Shri Mrinal Kanti Maity submitted separate appeals before the Customs, Excise and Gold Control Appellate Tribunal on 28-4-83 also.

(b) The findings and observations of the Tribunal at para 10 of its order dated April 7, 1983-"after taking into consideration the submissions of both sides, we are of the clear opinion that this appellant has no claim at all. Her learned counsel has referred to two rulings viz., Chagan Raju v. State of Andhra Pradesh, AIR 1980 SC page 470; Ganpatirai Dhanuka v. Collector, AIR 1973 Gauhati page 8. We have gone through these two rulings but in our opinion the same are not helpful in any way for the appellants since the facts stated therein are altogether different. The said two rulings could be in any way relevant had other two persons viz., Mrinal Kanti and Biswaranjan had filed the appeal but they did not do so''-are similarly erroneous in view of the facts stated at earlier para (a) above.

(c) The findings and observations of the Tribunal at para II of its said order to the effect that the appellant was summoned, is correct but it completely failed to consider that in response to the summons, the appellant duly stated that the gold ornaments belonged to her.

(d) The findings of the Tribunal in the said para II to the effect that the ornaments are new, that the said ornaments were of the shop owned' by Shri Biswaranjan Maity and these had been kept in his shop to dispose of in an illegal manner, that this Mrinal Kanti also did not disclose in his reply dated 3-11-81 that the said ornaments were owned by the. appellant etc., have not been given after considering the affidavit of Shri. Mrinal Kanti Maity and that of Shri Saibal Kumar Samanta and the statement recorded on 25-11-81 in respect of Shri Mrinal Kanti Maity and also the denial made in the case under reference. . , (e) The Tribunal has not expressed any opinion about the submission of the Departmental Representative to the effect that she (appellant) has no claim at all as she was introduced into the picture only on 25-10-81 by Shri Biswaranjan vide his reply though duly challenged on behalf of the appellant. The Tribunal should have expressed its opinion against this submission of the Departmental Representative that his submission were only his mere statement unsupported by any material.

(f) The Tribunal has entirely failed to deal with the very pertinent question raised by the appellant to the effect that there has been a complete violation of Rules of natural justice by not giving the notice u/s 79 of the Gold Control Act to the appellant.

(g) The Tribunal has omitted to deal with the point raised on behalf of the appellant to the effect that the order of the Departmental authorities suffered from vital defects as the alleged statement of Shri Mrinal Kanti has not been recorded by the gold control officer himself. Further, there was no discussion about the Affidavit filed by Shri Mrinal Kanti and another one Shri Saibal Kumar Samanta and that of the appellant. Hence these contentions remained undecided.

(h) The Tribunal while passing its order has omitted to look into various papers supported by evidences due to oversight and/or inadvertence." 3. Shri A.K. Chakraborty, the learned advocate, who appeared on behalf of the appellant has submitted that the observation of the Tribunal in paragraph No. 4 of its order dated 7-4-83 which reads as- "Sarvashri Biswaranjan as well as Mrinal Kanti did not challenge in any way the order passed by,the Deputy Collector confiscating the ornaments and imposing a penalty upon them. In this manner, the said order has become final against them." were neither argued by him nor by the Respondents and as such, the whole of the order was vitiated. The learned counsel has submitted that the provisions inserted by Finance Act (No. 2), 1980 as to the insertion of Section 129B are new and he has submitted that the appellant's miscellaneous petition for rectification should be accepted in view of sub-section (2) of Section 129B which reads as : "The Appellate Tribunal may, at any time within four years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1), shall make such amendments if the mistakes brought to its notice by the Collector of Customs or the other party to the appeal : Provided that an amendment which has the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the other party shall not be made under this sub-section, unless the Appellate Tribunal has given notice to him of its intention to do so and has allowed him a reasonable opportunity of being heard." He has also submitted that the provisions of Section 129B (2) are similar to those provisions under Section 254 (2) of the Income-tax Act, 1961 which reads as: "The Appellate Tribunal may, at any time within four years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1) and shall make such amendment if the mistake is brought to its notice by the assessee or the Income-tax Officer : Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard." The learned counsel has submitted before us that the order of this Tribunal is based on the observation contained in para 4 of its order dated 7-4-83 and this goes to the roots of the case and as this was neither pleaded by the appellant nor the respondent, there is patent mistake in the order dated 7-4-83 passed by this Tribunal and as such the whole of the order should be cancelled and the matter should be re-heard on merits. He has prayed that the order should be recalled and the miscellaneous application should be accepted.

The learned counsel for the petitioner placed reliance on the following judgments in support of his contentions : 38 ITR 1 (at page 11) Mangat Ram Kuthiala v. Commissioner of Income-tax. In the said judgment, their Lordships had observed-"Now it is a settled Rule that a judicial tribunal can recall and quash its own order in exceptional and rare cases when it is shown that it was obtained by fraud or by palpable mistake or was made in utter ignorance of a statutory provisions and the like." Again, "If the proceedings are in the nature of judicial proceedings, then irrespective of the class of the Tribunal, the Rule will apply and if an order has been obtained from or has been made by a judicial or a quasi-judicial tribunal because of practice of fraud or because of palpable mistake or because of ignorance of clear statutory provisions and the like, it has inherent power to recall such an order, quash it, and make an order on merits and according to law in the ends of justice." 58 ITR 626 (at 631) (Allahabad H.C.) S.B. Singar Singh and Sons v, Income-tax Appellate Tribunal-wherein the Hon'ble High Court held that all courts of plenary jurisdiction have an inherent jurisdiction to rectify manifest and palpable mistakes.

Referring to this judgment, the learned advocate for the petitioner pointed out that this Tribunal has also by virtue of Section 129B(2) such inherent powers to rectify its mistakes. Further, in this judgment the High Court had also placed reliance on the judgment of the Supreme Court in the case of Oriental Building and Furnishing Company v. C.I.T. wherein it was held that the Tribunal has plenary jurisdiction and all courts of plenary jurisdication have an inherent jurisdiction to rectify manifest and palpable mistakes.

Their Lordships also relied on the judgment in the case of Shri Bhagwan Radhi Kishan v. C. I. T. (Reported in 22 ITR 104 Allahabad) where it was held that the Tribunal had inherent powers to set aside an order deciding an appeal on wrong grounds.

The learned counsel also referred to Allahabad High Court's decision reported in 58 I.T.R. 634-Income-tax Officer v. Income-tax Appellate Tribunal wherein it was held that to hold that Section 35 would not be applicable in cases where the court or the Tribunal has inadvertently omitted to deal with a particular ground of appeal or contention having an important bearing on the decision of the appeal would be to place unnecessary and unwarranted restriction on the provisions of Section 35 of the Act. The only conditions that are required to be satisfied under Section 35 are that it must be an error apparent on the record and once that condition is satisfied there can be no justification for limiting the powers of the departmental officers or the Tribunal to rectify that error.

The learned counsel also referred to the judgment of the Bombay High Court in the case of Blue Star Engg. Company (Bom) Pvt. Ltd. v. C.I.T. reported in 73 I.T.R. 283 wherein it was held that the effect of the elimination of the error on the original order will depend upon each case. It may be that the elimination of the error may affect only a part of the order. It may also be that the error may be such as may go to the root of the order and its elimination may result in the whole order falling to the ground.

The learned counsel also cited the judgment of the Calcutta High Court 92 I.T.R. 189 (Cal) in the case of Murlidhar Surda v. Income-tax Appellate Tribunal wherein it was held that if in a particular case, it appears to the Tribunal that the opportunity could not have been properly availed of by a particular party as a result whereof the party did not have the opportunity of placing its case before the Tribunal, the Tribunal would have the power to decide the appeal again upon notice to the party or after giving the party an opportunity of being heard. This is a power incidental or ancillary to the jurisdication given to the Tribunal.

Further in the case of Shew Paper Exchange v. I.T.O. reported in 93 I.T.R. 186 (Calcutta) it was decided by the Hon'ble Calcutta High Court that the inherent power to rectify a wrong committed by itself, by a court or Tribunal is not really speaking, a power to review. The two powers operate in different fields and are different in essential quality or nature. The petitioner's contention was that the Tribunal should consider and take into cognisance certain fresh evidence which was not on record before the Tribunal at the time of hearing of the said appeal. This power is not ancillary or incidental to the powers of hearing an appeal. The right of review in the circumstances as claimed by the petitioner could not be assumed unless expressly given by statute or by Rules having the force of statute.

The learned counsel lastly referred to the Allahabad High Court's judgment in the case of Gargi Din Jwala Prasad reported in 96 I.T.R. 97. In this case the Hon'ble Court had held that assessment proceedings before income-tax Officers are judicial proceedings and the principles of natural justice are applicable to such proceedings. The elementary principle of natural justice is that the assessee should have knowledge of the material that is going to be used against him so that he may be able to meet it. The assessee has a right to inspect the records and all relevant documents before he is called upon to lead evidence in rebuttal.

The learned counsel for the petitioner further submitted before us that he had cited two judgments viz., Chagan Raju v. State of Andhra Pradesh, (AIR 1980 SC page 477) and Ganpatirai Dhanuka v. A.K. Bandyopadhyay, Collector, before this Tribunal for the disposal of the appeal, when the appeal was heard on 7-4-83.

Shri Chakraborty, the learned counsel also submitted that the Income-tax Appellate Tribunal had time and again passed such rectification orders correcting certain apparent mistakes which had inadvertently crept in the orders of the Tribunal. He had-submitted copies of the I.T.A.T`s orders in the following cases to substantiate his statement : 1. Order No. I.T.A. 5617 (Cal.) of 1975-76-I.T.O. v. Pandit Hazarimal Sharma.

2. Order Nos. I.T.A. 3851 and 5213 (Cal.) of 1971-72-Shri Kalipada Dig. v. I.T.O. 'C' Ward.

3. Order No. I.T.A. (Cal.) 355 of 1974-75-Sachin Barick General Enterprises (P) Ltd. v. I.T.O. 'A' Ward.

He, therefore, prayed that the whole of the order passed by this Tribunal dated 7-4-83 should be cancelled and/or recalled and the matter decided afresh on merits.

Shri B. Bhowmick, J.D.R. on behalf of the Revenue has submitted that the other two persons viz., S/Shri Biswaranjan Maity and Mrinal Kanti Maity had not filed any appeals upto the date of hearing of the appeal before this Tribunal. He sought the adjournment of the case to 5th September so that he could confirm from Shri A.K. Saha, S.D.R. who had earlier pleaded this case for the Department, whether he had made any such statements to the effect that the said two persons had filed appeals or not. On his request, the case was adjourned to 5-9-83. On 5-9-83, Shri Chakraborty, Shri Bhowmick and Shri A.K. Saha again appeared. Shri A.K. Chakraborty as well as Shri A.K. Saha both had made statements on the bar and which has been duly signed by them. The same is reproduced as under : "Shri A.K. Chakraborty, Advocate is present on behalf of the appellant. He states that he did not make any argument at the time of hearing before this court as to the filing or non-filing of appeals by S/Shri Biswaranjan Maity and Mrinal Kanti Maity against the order of Deputy Collector. The observation by this court is beyond record and Shri A.K. Saha, S.D.R. has pleaded that he had also not brought it to the notice before the learned predecessors as to filing and non-filing of appeals by the said two persons and he had submitted that he has got no objection if the order is recalled.

Both the sides agree that there is a patent error in the order dated 7-4-83 of the Tribunal, in appeal No. GD (T) CAL-8/83." Sd/- Sd/-A.K. Chakraborty, Advocate A.K. Saha, Senior D.R. 5-9-83 5-9-83 After going through the facts, records and various judgments cited by the learned advocate, and the order in original passed by this court, it appears that this court had come to the conclusion that the appellant had no locus standi to file an appeal. Para 10 of the order dated 7-4-83 is reproduced as under: "After taking into consideration the submissions of both sides, we are of the clear opinion that this appellant has no claim at all." This finding by this Tribunal clearly indicates that this court had come to definite finding that the appellant had no locus standi and this finding cannot be said to be a mistake which can be rectified.

However, I find that the learned counsel for the appellant at the time of making argument had referred to two judgments before this court viz.

Chagan Raju v. State of Andhra Pradesh (AIR 1980 SC 477) and Ganpatirai Dhanuka v. Collector (AIR 1973 Gauhati page 8). The learned members had observed in the order dated 7-4-83 : "We have gone through these two rulings but in our opinion the same are not helpful in any way for the appellants since the facts stated therein are altogether different. The said two rulings could be in any way relevant had other two persons viz., Mrinal Kanti and Biswaranjan had filed the appeal but they did not do so." "Sarvashri Biswaranjan as well as Mrinal Kanti did not challenge in any way the order passed by the Deputy Collector confiscating the ornaments and imposing a penalty upon them. In this manner, the said order has become final against them." This shows that the finding to the effect that the appellant had no claim at all was arrived at by this court only on the basis of the notion that the other two persons i.e., Biswaranjan Maity and Mrinal Kanti Maity had not challenged the order in any way. The learned advocate as well as the S.D.R. had admitted that both of them had never argued the same before this court and their statement on bar has been reproduced above.

We are not going to the merits of the appellant's case whether the appellants had any locus standi or not. From the facts and the legal position discussed above, apparently it looks that there is a patent error in the passing of the order which goes to the root of the order.

The learned advocate for the appellants had also filed a paper book for the disposal of the miscellaneous petition. We feel that the papers mentioned at Sl. 1,2 and 3 running from page 1 to 6 are fresh evidences for the purposes of this application and as such we do not take any notice of the same. This factum was duly brought to the notice of the appellant as well as the respondent. Undoubtedly, this court has inherent powers in view of the Supreme Court's judgment in the case of I.T.O. v. Muhammad Kuntri (71 I.T.R. 815) and Purina Mal Kanto v.I.T.O. (98 ITR 39). It was also held in the case of Jagadambika Pratap v. I.T.O. (76 ITR 619) that the Tribunal has inherent jurisdiction to rectify a wrong committed by itself when that wrong causes prejudice to an innocent party. There is another judgment reported in 82 I.T.R.314-Malchand Surana v. C.I.T. where it was held that having decided an appeal on a preliminary issue, the Tribunal has implied jurisdiction to vacate the order in appropriate cases and hear the appeal on merits.

From the statements on bar of the advocate of the appellant as well as the S.D.R., we feel that this court had come to the conclusion that the appellant had no claim at all on the basis of the fact that S/Shri Biswaranjan Maity and Mrinal Kanti Maity had not filed appeals and as such the orders had become final against them. This goes to the root of the case.

In view of the above arguments and the legal position discussed above, we feel that justice demands that this matter should be re-heard on merits. We, accordingly, recall the order of the Tribunal dated 7-4-83 disposing of the appeal. In the result, the miscellaneous application dated 6th June, 1983 is allowed and the appeal shall be posted for fresh hearing.


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