SYED SULTAN AHMAD, MEMBER (JUDICIAL).- (1) This appeal u/s. 35-B of the Central Excises Act, 1944 is directed against Order-in-Original No. 26/2002 dated 8.5.2002 passed by Collector (Adjudication), Central Excise, Rawalpindi whereby he ordered the appellant to pay development surcharge alongwith additional duty purportedly u/s. 3-B of Central Excises Act, 1944 and also to pay penalty equal to the amount of development surcharge under Rule 210 of Central Excise Rules, 1944.
2. Short of unnecessary details, an audit team had conducted the audit of appellant company.
During the course of audit, it was allegedly observed that the appellant unit supplied/cleared PMG, High Speed Diesel and Kerosene Oil but did not pay the development surcharge included in the fixed sale price on PMG @ Rs. 1.13 per liter during September, 1999 to December, 1999 as notified by Ministry of Petroleum and Natural Resources vide Notification No. PL-3 (169-A)/99 dated 23.09.1999.
That this development surcharge is other than development surcharge paid by the company included in the prescribed price @ Rs. 9.08 per liter as per above-referred notification. Show cause notice dated 9.4.2002 fixed the date of hearing for 25.4.2002. The appellant feeling aggrieved of Order-in-Original No. 26/2002 of Collector (Adjudication) has come in appeal.
3. We have heard both the sides at considerable length and have minutely perused the record.
Learned counsel for appellant at the very outset submitted that the impugned order is bad in law because the appellant was not properly and legally served and this aspect gave rise to an ex- parte order. That a great prejudice has been caused to the rights of appellant who was intentionally condemned unheard. He referred para (4) of the order under appeal and also para- wise comments filed by the Department in reply to the grounds of appeal with special reference to ground (b). Conversely, learned D.R. Defended the impugned order.
4. We have undergone many anxious moments while perusing para (4) of the impugned order and putting the same to legal test. Para (4) is reproduced below for full appreciation: "Hearing in the case was fixed on 25.4.2002 but no one appeared. Final hearing was fixed on 8.5.2002. Mr. Ghulam Farid, Superintendent appeared to represent the Collectorate while no one appeared on behalf of the respondent unit. The case cannot be kept pending due to non appearance of respondents and is therefore, decided on the basis of evidence/documents available on record."
It appears from the tenor of the above contents that none appeared before Collector (Adjudication) on 25.4.2002. Nothing has been shown to us to prove that notice for appearance on 8.5.2002 was duly served. Last lines exhibit indecent haste in disposal of the case. Ground (b) contained in memorandum of appeal raises a specific objection to this effect. No satisfactory explanation to rebut this contention is forthcoming from the other side. It is well- settled that the provisions of issuance of notice are based upon the maxim audi alteram partem because the respondent has a right to appear and defend. The dictum of law laid down in PLD 1971 SC 192, 1986 CLC 2643, 2003 CLC 1011 and 2000 CLC 1257 fortify this view. Service of notice in accordance with law has to be proved. Law has gone a step further to hold that where sufficient time was not available for the respondent to appear and answer, the service cannot be deemed to be 'due service'. Be that as it may, the main principle to which the fate of this appeal would tum is the basic principle of law enshrined in the hallowed doctrine of audi alteram partem. There is no dearth of authorities in support of this principle. We are not satisfied that proper opportunity of being heard was provided to the appellant in this particular case.
5. The upshot of the above discussion is that the style of passing the impugned order would be regarded as defiance of mandatory requirement of law by attempting to arbitrarily exercise of authority in flagrant disregard of prescribed procedure as exercise of authority without proper legal notice to respondent offended against principles of natural justice and would be void, illegal and arbitrary. The appellant has inalienable right of hearing and thereby could not be condemned unheard before taking an action which is punitive in nature.
6. In the sequel, the instant appeal is hereby accepted and by setting aside the order under appeal the case is remanded back to the original Adjudicating Officer with the direction to give de novo consideration to the dispute involved by providing fair opportunity of being heard to both the parties and after looking into their oral as well as documentary evidence within two months.
7. Announced.
8. All concerned be informed accordingly.