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DR. ZAFAR AHMFD KHAN SHERWANI (MEMBER (JUDICIAL-I)).---This is an appeal under section 194-A of the Customs Act, 1969 (the Act) against an Order-in-Appeal No.188 of 2007 dated 26-3-2007 whereby an Order-in-Original No.1107/95-BG-Exp dated 18-3-1995 was set aside by allowing the appeal.
2. Brief facts leading to this appeal are that 54 duty draw back claims amounting to Rs.2,404,577.00 were filed by the respondent in the year 1994 against an undertaking by the bank in lieu of the Bank Credit Advice that foreign exchange will be realized within 120 days under CGO 12/92 but failed to produce the Bank Credit Advice well in time in term of undertaking, therefore, a recovery order was passed be the competent authority vide Order-in-Original referred to above dated 15-3-1995. The recovery was effected h the respondent No.1 out of 12 claims as per details mentioned in the memorandum of appeal in detail. However, the respondent No I after expiry of limitation period coming to know that record and proceedings were not available with the appellant's office stared claiming that the order was not served on him and filed a time-haired appeal he tore learned Collector (Appeals) which was allowed vide the impugned order, hence this appeal.
3. It was contended by the departmental representative that the payment order was issued by the competent authority on the basis of undertaking given by the respondent No.1 and the order-in- original was passed in accordance with law as no show-cause notice was required to be served on the respondent No.1 and since the respondent No.1 had complied with the order, therefore, no appeal could be filed after lapse of 12 years from the passing of order-in-original which was in the knowledge of the respondent No.1, hence the impugned order is illegal and requires to be set aside.
4. Mr. Nadeem Ahmed Mirza, Consultant, appeared on behalf of the respondent No.1 submitted that the impugned order has been passed strictly in accordance with law as the principle of natural justice was denied to the respondent No.1 while passing the order-in-original as neither any show- cause notice was issued to it nor an opportunity of being heard was provided during adjudication proceeding and when it come into notice regarding the deduction of the amount in term of orderin-original, the appeal was filed. It was further submitted that no undertaken was given by the respondent No.1 as alleged by the appellant , therefore, until and unless the undertakings were confronted with the respondent No.1 by way of show-cause notice and an opportunity of being heard was provided to it the order-in-original could not be passed; hence the same was legally set aside by the Collector (Appeals) and implemented by the learned Federal Tax Ombudsman on such application by the respondent No.1; hence the appeal is liable to be dismissed.
5. We have carefully considered the arguments and perused the record and reached to the conclusion that the appeal is devoid of any merit because the learned appellate authority has rightly held that since admittedly no show cause notice was issued to the respondent No.1 before passing the order-in-original therefore, the same was set aside. It is well settled principle of natural justice that before taking any punitive action against any person he is required in the first instance to be served with a show-cause notice confronting the material available on record in support of the charge and any action which was in violation of such principle of natural justice, audi alteram parten, the same will be void ab-initio. Under these circumstances the impugned order neither suffers from any illegality nor impropriety, therefore. The appeal is fit to be dismissed. Order accordingly. .