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Cites 18 docs - [View All]
The Salt Cess Act, 1953
Hukumchand Mills Ltd vs Commissioner Of Income-Tax, ... on 22 September, 1966
Asian Paints India Ltd vs Collector Of Central Excise on 23 March, 1988
State Of U. P vs Manbodhan Lal Srivastava on 20 September, 1957
Sales Tax Officer, Banaras & ... vs Kanhaiya Lal Mukundlal Saraf on 23 September, 1958

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Customs, Excise and Gold Tribunal - Delhi
Gaurav Paper Mills vs Collector Of C. Ex. on 13 March, 1989
Equivalent citations: 1989 (22) ECR 581 Tri Delhi, 1989 (41) ELT 522 Tri Del



ORDER
 

G.P. Agarwal, Member (J)
 

1. The applicants have filed the instant application purporting to be under Rule 23 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982 for permission to produce the following documents by way of additional evidence -

(1) Classification List No. 20/83 effective from 1-9-83.

(2) Classification List No. 35/83-84/C effective from 1-3-1984.

(3) Xerox copy of a letter No. GPM/Admn/142 dated 27-5-83 from the Petitioners to the Superintendent of Central Excise Range II Circle Chandrapur.

(4) Xerox copy of letter No. GPMS/4 (a) 1983/84 dated 27-8-1984 from the Petitioners to the Superintendent Central Excise Range-I Chandrapur.

(5) Copy of letter No. C. No. Bramhapuri/84/2343 dated 14.11.1984 from the Superintendent Central Excise Range-I Chandrapur to the Petitioners.

(6) Xerox copy of letter No. GPMS (a) 2520/84 dated 23-11-1984 from the Petitioners to the Assistant Collector, Central Excise, Chandrapur.

(7) Xerox copy of letter No. GPMS/44/912/85 dated 2-7-1987 from the Petitioners to the Chemical Examiner, Central Excise, Central Laboratory Bombay (Camp G.P.M. Hardoli).

(8) Xerox copy of letter No.C.No. I (Admn) 8-1/82/1801 dated 5-3-1988 from Assistant Collector, Central Excise Divn. Chandrapur to the Petitioners.

(9) Xerox copy of letter No. GLI/Admn/Misc/2/85-/3 dated 13-3-1985 from Inspector Central Excise Sector G.P.M. Hardoli addressed to the Petitioners.

(10) Xerox copy of letter No. C. No. GLE/GPM/Misc/2/85-86/732 dated 29-12-1986 from Inspector Central Excise Sector G.P.M. Hardoli addressed to the Petitioners.

(11) Xerox copy of letter No. GPMS/10/042/87 dated 5-1-1987 from the Petitioners to the Inspector Central Excise Sector G.P.M. Hardoli Bram-hapuri.

(12) Xerox copy of Form D-3 dated 4-5-1984.

(13) Extracts from Encyclopedia of Chemical Technology by Kirk & Othmer (3rd Edition) Volume, 24 (Page No. 456) (14) Copy of M.F. (D.R.) Notification No. 225/86-CE dated 3-4-1984.

(15) Extract from the Condensed Chemical Dictionary Tenth Edition by G.G. Hawley.

(16) Extract from Page 388 of the Concise Science Dictionary-Oxford University Press - 1987 and others.

2. When the case was called it was pointed out by the Bench that the documents listed at S. Nos. 13,15 and 16 are extracts from authoritative books and document listed at S. No. 14 is a copy of the Notification hence there should be no objection for their production from the side of the Department. In reply Shri L.C. Chakraborti, learned JDR with his usual frankness did not object to their production by way of additional evidence.

3. As regards the documents listed at S. Nos. 1 to 12 it was contended by Shri A.K. Jain, learned counsel for the applicants that the production of these documents is considered most relevant to establish that the demand of duty made in the show cause notice dated 7-9-1987 in the instant case was time barred which ground has already been taken in the appeal filed by the applicants as Ground No. (V). To support his contention he cited the following case law -

(1) Paints & Colour v. Collector, 1986 (25) ELT 288 (2) Beharilal Ramcharan Cotton Mills v. Commissioner of Income Tax, (1966) 61 ITR (SH.N) 14 Page 212 (3) Hukumchand Mills Ltd. v. Commissioner of Income Tax, (1967) 1 SCR 463 (4) Commissioner of Income Tax v. Godavaridevi Saraf, (1978) 113 ITR 589

4. In reply Shri L.C. Chakraborti, learned JDR submitted that a show cause notice dated 7-9-1987 was issued to the applicants for the illegal clearances of the goods during the period 1-3-1986 to 28-2-1987 without payment of duty. He emphasised that in the show cause notice it was expressly stated that the duty was not paid by the applicants because of the wilful mis-statement and suppression of facts hence the proviso to Section 11-A of the Central Excises and Salt Act, 1944 became applicable in the case. The applicants in their reply never disputed the said allegations of wilful mis-statement or suppression of facts as stated in the show cause notice. In a nutshell, he submitted that the applicants never contested the show cause notice before the Adjudicating Authority on the ground that it was barred by limitation. He vehemently contended that the instant case is a case where the applicants want to put the cart before the horse. For, according to him, the applicants without seeking the prior permission of the Tribunal has taken a new ground in the memorandum of appeal that the demand was time barred and now want to substantiate that new ground which the applicants have incorporated in their memorandum of appeal without the prior permission of the Tribunal, by producing the additional documents. This course, according to him, is not permissible under the law. Counting his reply he submitted that in case the applicants are permitted to produce the additional evidence as requested, it would require investigation of facts. Thus, according to their own showing, the present case is a case where the applicants either want to make out a new case or want to fill up the lacunae in their defence case. To support his contentions he cited the following case law -

(1) State of U.P. v. Manbodhan Lal, AIR 1957 SC 912 (2) Unique Beautycare Product Pvt. Ltd. v. Collector of Central Excise, 1988 (37) ELT 369 (3) Mohinder Singh v. Chief Election Commissioner, AIR 1978 SC 851 (4) Collector of Central Excise v. Bata (India) Ltd., 1987 (32) ELT 1989.

5. Before we proceed to examine the rival contentions raised by the parties it would be advantageous to state a few admitted facts which are as follows -

(i) It is admitted to the applicants that the plea that the demand made in the show cause notice was time-barred was not taken up by them before the Adjudicating Authority; and

(ii) that they (applicants) have not taken any leave of this Tribunal to urge the , said plea of limitation i.e. to say they have their own set up the plea of limitation in the grounds of appeal filed before this Tribunal.

6. After stating the admitted facts as aforesaid it would also be useful to state the provisions of the Central Excises and Salt Act, 1944 under which the present appeal is filed and also the Rules made thereunder. Under Sub-section (1) of Section 35D of the Central Excises and Salt Act, 1944 this Tribunal has been empowered to regulate its own procedure and in exercise of its powers it has framed its own Rules known as "The Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982". Rules 8 and 23 are material for the purposes of our case. Rule 8 provides as follows -

"8. Contents of a memorandum of appeal. - Every memorandum of appeal shall set forth, concisely and under distinct heads, the grounds of appeal and such grounds shall be numbered consecutively and shall be typed in double space on one side of the paper."

7. The said Rule 8 is similar to Rule 1(2) of Order XLI of the Code of Civil Procedure, 1908 and provides -

"Contents of memorandum. - (2) The memorandum shall set forth, concisely and under distinct heads the grounds of objection to the decree appealed from without any argument or narrative; and such grounds shall be numbered consecutively."

8. While interpreting the said Sub-rule (2) of Rule 1 of Order XLI, C.P.C. it has been authoritatively held by the Apex Court time and again that the appellant cannot raise a new case not set out by him in the Trial Court [See M.P. Shreevastava v. Veena, AIR 1967 SC 1193 and also Slate v. Ramji Mandir Trust, Baroda, AIR 1979 Guj. 113] and the only exception to this general principle is that a new plea can be raised with the leave of the Court. In the case of Indore Municipality v. Niyamapulla, AIR 1971 SC 97 the defendant wanted to raise the plea of limitation as a ground of appeal for the first time contending that the proceedings in the trial Court were barred by a period of limitation prescribed under Section 135(2) of the Indore Municipal Act, 1909. This plea of limitation was not allowed to be raised as a ground of appeal by the Hon'ble Supreme Court observing as follows -

"10...In the present case, the Municipal Corporation did not plead Section 135 of the Indore Municipal Act, 1909 as a defence, such a plea was not taken in the pleadings or in the trial Court and the District judge should have not entertained such a plea".

In the case of MAT. Ranganathan v. Govt. of Madras, AIR 1955 SC 604 it was held by the Hon'ble Supreme Court that the Appellate Court will not entertain a point of law raised for the first time, if the point cannot be raised without remanding the case for fur-therevidence. Likewise whether a new plea tried to be raised in the Appellate Court for the first time is one of mixed question of law and fact the Appellate Court should not entertain it for the first time. In the case of Banarsi Das v. Kanshi Ram, AIR 1963 SC 1165 it was held by the Hon'ble Supreme Court that the Appellate Court will not permit a point of limitation to be raised where it involves an investigation of further facts. In the instant case admittedly the plea that the demand made in the show cause notice was time-barred admittedly involves an investigation of facts and that is why the applicants have prayed for taking the documents listed at Srl. No. 1 to 12 as extracted above on record. Thus, the applicants cannot be allowed to raise this plea of limitation for the first time before us which involves an investigation of further facts. The case of Beharilal Ram-charan Cotton Mills v. Commissioner of Income Tax, supra on which much reliance was placed by the learned counsel for the applicants does not apply to the instant case. In that case the assessee was claiming depreciation allowances under Section 10(2) (vi) and Section 10(2) (via) of the Income Tax Act before the Income Tax Officer as well as before the Appellate Commissioner and to support his plea he led the evidence. However, in the appeal before the Tribunal on the basis of the evidence led by him the assessee pleaded that he was entitled to depreciation under Section 12(3) of the Act. But the Tribunal did not allow the assessee to raise this plea under Section 12(3) on the ground that the assessee was making out a completely new case and the contention raised was altogether a new contention. In these circumstances it was held by the Bombay High Court that in the facts and circumstances of the case the assessee was not setting up a new case but was only calling in aid one more provision of law to support his claim for depreciation on same set of facts and the Tribunal was not justified in not considering the case of the assessee under Section 12(3) on the material already on the record. Here the case is opposite and the plea of the limitation which the applicants want to raise now requires evidence. The case of Paints & Colour v. Collector, supra is also distinguishable on the facts of that case. In that case it appears that on the basis of amendment made in Sub-rule (2) of Rule 9 of the Central Excise Rules (which was amended to provide for limitation of period as specified in erstwhile Rule 10), the appellants of that case raised a new plea that demand of duty on them was barred by time. Since the said plea of limitation was based on the interpretation of the erstwhile Rule 10 and the amended Sub-rule (2) of Rule 9 the Tribunal allowed the plea to be raised being a question of law and ultimately on the interpretation of the said Rules concluded against the appellants. The case of Hukumchand Mills Ltd. v. Commissioner of Income Tax, supra is also distinguishable. It speaks of the powers of the Tribunal to entertain new point in appeal and therefore is not applicable to the instant case because there cannot be any dispute that this Tribunal has a jurisdiction to entertain new points in appeal subject of course to the provisions of law. The only other case Commissioner of Income Tax v. Godavaridevi Saraf, supra relied upon by the applicants is also not applicable to the instant case as it speaks that the law declared by the High Court in its State is binding on Tribunal in another State.

9. At this stage it may also be stated that we are aware of Rule 10 of the CEGAT (Procedure) Rules, 1982 which provides -

"10. Grounds which may be taken in appeal. - The appellant shall not except by leave of the Tribunal, urge or be heard in support of any grounds not set forth in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or those taken by leave of the Tribunal under these rules:

Provided that the Tribunal shall not rest its decision on any other grounds unless the party who may be affected thereby has had a sufficient opportunity of being heard on that grounds."

10. It may be stated that the said Rule is in pari materia with Rule 2 of Order XLI of C.P.C. which runs thus -

"R.2. Grounds which may be taken in appeal. - The Appellant shall not, except by leave of the Court, urge or be heard in support of any ground of objection not set forth in the memorandum of appeal, but the Appellate Court, in deciding the appeal, shall not be confined to the grounds of objection set forth in the memorandum of appeal or taken by leave of the Court under this rule:

Provided that the Court shall not rest its decision on any other ground un- less the party who may be affected thereby has had a sufficient opportunity of contesting the case on that ground."

11. From the scheme of Rules 1 and 2 of Order, XLI of C.P.C. [in the instant case Rules 8 and 10 of the CEGAT (Procedure) Rules] it would be clear that Rule 1 of Order XLI prohibits the appellant from raising a new case/plea not set up by him in the trial Court in the memorandum of appeal whereas Rule 2 of the same Order provides for a situation where the appellants failed to incorporate his ground of objection in the memorandum of appeal while filing it in the Appellate Court through oversight or inadvertence etc. and want to raise it at the time of arguments. To meet this situation Rule 2 provides that the appellant may urge any ground of objection not set forth in the memorandum of appeal due to inadvertence etc. with the leave of the Court and the Court may grant the permission if it is a question of law depending on no new facts except those already on the record. (See Keshavlal Lallubhai Patel v. Lalbhai Trikumal Mills Ltd, AIR 1958 SC 512 and Subbanna v. Kudappa Subbanna, AIR 1965 SC1325).

12. Needless to say that we have adverted ourselves to examine the scope of Rule 10 of the CEGAT (Procedure) Rules (which corresponds to Rule 2 of Order XLI C.P.C.) to dispel the wrong conception that a party in the appeal before the Tribunal can raise any new ground or to raise new case not set up by him in the Trial Court as a ground of objection in the memorandum of appeal without the leave of the Tribunal. And once a party incorporates any new case not set up by him before the Adjudicating Authority, no leave of the Tribunal is required in terms of Rule 10 of the CEGAT (Procedure) Rules because it speaks of the necessity of leave of the Tribunal only when any ground of objection was not set forth in the memorandum of appeal.

13. Be that it may, in the intant case admittedly the applicants have not sought any permission from this Tribunal to set up a new case in the memorandum of appeal that demand made in the show cause notice was time barred and have incorporated the plea of limitation in the memorandum of appeal of their own. Hence the contention of the learned counsel for the applicants that their request to produce additional evidence be granted since they have already taken up it as a ground in their memorandum of appeal filed in this Tribunal cannot be accepted. In other words the contention of the learned counsel for the applicants that they have taken up the plea of limitation in their memorandum of appeal cannot, in our considered opinion, be a ground and therefore their prayer for addl. evidence under Rule 23 of the CEGAT (Procedure) Rules has to be examined in the light of the provisions of the said Rule. We proceed accordingly.

14. Rule 23 of the CEGAT (Procedure) Rules provides -

"23. Production of additional evidence. - (1) The parties to the appeal shall not be entitled to produce any additional evidence, either oral or documentary, before the Tribunal, but if the Tribunal is of opinion that any documents should be produced or any witness should be examined or any affidavit should be filed to enable it to pass orders or for any sufficient cause, or if the adjudicating authority or the appellate or revisional authority has decided the case without giving sufficient opportunity to any party to adduce evidence on the points specified by them or not specified by them, the Tribunal may for reasons to be recorded, allow such documents to be produced or witnesses to be examined or affidavits to be filed or such evidence to be adduced.

(2) x x x .x x x x x x x (3) x x x x x .x x x x x (4) The Tribunal may, of its own motion, call for any documents or summon any witnesses on points at issue, if it considers necessary to meet the ends of justice."

15. A close analysis of the said Rule would make it clear that a party to an appeal shall not be entitled to produce any additional evidence either oral or documentary, before the Tribunal. But if-

(1) the Tribunal is of opinion that any documents should be produced...to enable it to pass orders or for any sufficient cause, or (2) if the adjudicating authority or the appellate or revisional authority has decided the case without giving any sufficient opportunity to any party to adduce evidence on the points specified by them or not specified by them, the Tribunal may for reasons to be recorded, allow such documents to be produced...or such evidence to be adduced.

Besides, sub-rule (4) of Rule 23, ibid also gives suo motu power to the Tribunal to call for any documents, if it considers necessary to meet the ends of justice.

The said Rule 23 is some what similar to Rule 27 of Order XLI, C.P.C.

16. The general principle is that the Appellate Court should not travel outside the record of the lower Court and cannot take any evidence in appeal [See Bombay Corporation v. Puncham - AIR 1965 SC 1008 and Soonda Ram v. Rameshwarlal - AIR 1975 SC 479]. And this Rule 10 of the CEGAT (Procedure) Rules (Rule 2 of Order XLI) is an exception to the said general principle. Under this Rule it is open to the Tribunal to admit fresh evidence if it is of opinion that such evidence should be produced to enable it to pass orders or for any sufficient cause or if the authorities below has decided the case without giving sufficient opportunity to any party to adduce any evidence or if the Tribunal considers such evidence necessary to meet the ends of justice. However, such powers to admit additional evidence should be exercised cautiously and sparingly and only in exceptional cases and the new evidence should have a direct and important bearing on a main issue in the case [See Parsolum Thakur v. Lal Mohar Thakur - AIR 1931 PC 143]. In the case of State of U.P. v. Manbodhan Lal - AIR 1957 SC 912 it was held that "It is well-settled that additional evidence should not be permitted at the appellate stage in order to enable one of the parties to remove certain lacunae in presenting its case at the proper stage and to fill in gaps." In that case the Hon'ble Supreme Court after stating the aforesaid well-settled position in law refused to admit additional evidence observing as follows -

"Without looking into the additional evidence proposed to be placed before us, we indicated that we would not permit additional evidence to be placed at this stage when there was sufficient opportunity for the State Government to place all the relevant matters before the High Court itself. We could not see any special reasons why additional evidence should be allowed to be adduced in the Court. It was not suggested that all that matter which was proposed to be placed before this Court was not available to the State Government during the time that the High Court considered the writ petitions on two occassions."

16A. Following this authoritative pronouncement of the Apex Court this Tribunal in the case of Unique Beauty Care Product Pvl. Ltd. v. Collector of Central Excise -1988 (37) ELT 369 did not allow the appellants of that case to raise a new point that there was no chemical transformation of the ingredients into Kajal on the ground that the same point was not raised before the lower authorities and also refused to admit additional evidence holding that there was sufficient opportunity for the appellants to produce affidavit before the lower authority, but they failed to do so. These authorities apply on all fours to the instant case. The appellants had ample opportunity to raise the plea of limitation that the demand made in the show cause notice was time barred. They had also sufficient opportunity to produce the documents before the authorities below which they now want to produce before this Tribunal by way of additional evidence. Even no such plea has been taken by the applicants in their instant application for admitting the additional evidence. It is interesting to note that in the application in hand they have admitted that the documents they sought to produce now were in their possession but plead that the same could not be produced before the authorities below inadvertantly. This can hardly be a ground for admitting the additional evidence at this stage.

17. It may be stated that we do not require of our own the said documents as the same are not required to enable us to pass orders or for any sufficient cause. We also do not consider the necessity to admit these documents to meet the ends of justice. Tersely no question of "ends of justice" is involved in the instant case as the department is not trying to demand or collect any tax/duty without any sanction of law.

18. In the light of the foregoing we refuse the prayer of the applicants for the production of documents listed at Srl. Nos. 1 to 12 as aforesaid.

19. In the result this application is partly allowed and the documents listed at Srl. Nos. 13 to 16 as stated above are taken on record as additional evidence and the prayer for the production of the rest of the documents is rejected as aforesaid.