Gujarat High Court
Universal Comfort Products Ltd. (Now ... vs Union Of India on 9 October, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/10869/2025 ORDER DATED: 09/10/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 10869 of 2025
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UNIVERSAL COMFORT PRODUCTS LTD. (NOW VOLTAS LTD.)
THROUGH POA JUHI CHAUDHARY
Versus
UNION OF INDIA & ORS.
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Appearance:
AMAL PARESH DAVE(8961) for the Petitioner(s) No. 1
MR PRADIP D BHATE(1523) for the Respondent(s) No. 1,2
MR UTKARSH R SHARMA(6157) for the Respondent(s) No. 3
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 09/10/2025
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned advocate Mr. Amal Dave for the petitioner and learned advocate Mr. Utkarsh Sharma for the respondent.
2. The petitioner has prayed for the following reliefs:
"A. Your Lordships may be pleased to issue a Writ of Certiorari or Mandamus or any other appropriate writ, order or direction, thereby quashing and setting aside Miscellaneous Order No.10023/2025 dated 31.01.2025 and directing the Appellate Tribunal to recall Final Order No.11831/2023 dated 30.08.2023 Page 1 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined and restoring the Petitioner's Excise Appeal No.10992 of 2013-SM: or in the alternative, your Lordships may be pleased to issue a Writ of Certiorari or a Writ of Mandamus or any other appropriate writ, direction or order, quashing and setting aside Final Order No.11831/2023 dated 30.08.2023 and directing the Appellate Tribunal to pass a fresh Order after hearing the Petitioner on merits;
3. Brief facts of the case are as under:
3.1 The petitioner Company is engaged in the manufacture of excisable goods classifiable under Chapter 84 of the First Schedule to the Central Excise Tariff Act, 1985. The petitioner effected the removal of finished goods having an aggregate assessable value of Rs.15,92,280/- to developers of Special Economic Zones (for short 'SEZ')during the period from 2007-08 and 2008-09 without payment of excise duty or reversal of proportionate credit in terms of Rule 6(3)(ii) of the Cenvat Credit Rules, 2004.Page 2 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025
NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined 3.2 A show-cause notice dated 28.2.2011 was issued to the petitioner alleging that the clearances of goods made to SEZ developers do not fall within the purview of Rule 6(6)(i) of the Cenvat Credit Rules, 2004 and, therefore, the petitioner was not eligible for the exemption. It was also alleged that the petitioner failed to maintain separate records for inputs/ input services and did not pay the required 10% of the value of exempted goods cleared.
3.3 The petitioner filed reply to the show-cause notice contending that no provisions of Rule 6 of the CENVAT Credit Rules has been violated. The adjudicating authority passed an Order-in-
Original dated 19.12.2011 confirming the demand for excise duty along with interest and penalty on the ground that the clearances made by the petitioner to SEZ developers without payment of duty were not eligible for exemption under the provisions of Rule 6(6) of the CENVAT Credit Page 3 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined Rules, 2004.
3.4 Being aggrieved, the petitioner preferred an appeal before the Commissioner (Appeals) Central Excise. The Commissioner of Central Excise (Appeals) rejected the appeal filed by the petitioner by order dated 21.1.2013. Being aggrieved, the petitioner preferred an appeal before the Customs, Excise and Service Tax Appellate Tribunal('CESTAT' for short). The CESTAT passed an order dated 30.8.2023 holding that the benefit under Rule 6(6) of the CENVAT Rules, 2004, as amended by Notification No.50/2008-CE (NT) applies only to supplies made to SEZ developers only from 31.12.2008 onwards and the claim of the petitioner for retrospective effect was rejected holding that as the amendment was prospective. It was also held by the CESTAT that supplies to SEZ developers before this date did not qualify as export and accordingly upheld the denial of CENVAT credit by dismissing the Page 4 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined appeal.
3.5 The petitioner received recovery notice only on 16.1.2024 and became aware that an order has been passed by the CESTAT.
3.6 The petitioner, therefore, filed a rectification application on 27.2.2024 being Excise Misc. Application No. 10042 of 2024 in Excise Appeal No. 10992 of 2013 before CESTAT contending that the order was passed without considering the correct legal position and relevant similar issue has already been decided.
It was also contended by the petitioner that the petitioner did not receive any notice of hearing due to change in address of the petitioner and, therefore, could not remain present during the hearing before the CESTAT.
3.7 The CESTAT dismissed the rectification application by order dated 31.1.2025 on the Page 5 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined ground that the petitioner has failed to update the address with the Registry and there is no mistake apparent on record as CESTAT had become functus officio after passing the order dated 30.8.2023.
3.8 Being aggrieved by the impugned order dated 31.1.2025, the petitioner has preferred this petition.
4. Learned advocate Mr. Amal Dave for the petitioner submitted that the CESTAT has passed the ex-parte Order-in-Appeal preferred by the petitioner ignoring the fact that the notice was not served due to change of address of the petitioner. It was also submitted that the order on merits passed by the CESTAT also suffers from various mistakes apparent on record. It was also pointed out that the CESTAT has referred and relied upon the decision of Division Bench of the Tribunal in the case of Sujana Metals wherein it Page 6 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined was held that the benefit under Rule 6(6A) of the CENVAT Credit Rules, 2004 would be applicable retrospectively. However, mistake apparent on record is committed in observing that the decision of M/s. Sujana Metal Products Ltd. v.
Commissioner of C. Ex., Hyderabad, reported in 2011 (273) ELT 112 [Tri-Bangalore] was contradicted in case of Surya Roshni Ltd. v.
Commissioner of Central Excise, Rohtak, reported in 2012 (285) E.L.T 518 (Tri-Delhi), but the CESTAT has not referred to even the citation of the said decision, which is passed by CESTAT, New Delhi wherein, the decision of Sujana Metal is considered and applied to hold that the amendment in Rule 6(6) of the CENVAT Credit Rules, 2004 would be applicable retrospectively during the period prior to 31.12.2008 on which the amendment has come into effect by Notification No. 50 of 2008.
4.1 It was, therefore, submitted by learned Page 7 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined advocate Mr. Dave that on both the counts, the Order in Appeal was passed ex-parte as well as there were mistakes apparent on the record in relying upon the decision of the Division Bench of the CESTAT in case of Sujana Metals (Supra), the CESTAT ought to have allowed the Misc.
Application for recalling its Order in Appeal so as to provide opportunity of hearing to the petitioner to point out the correct legal position. In support of his submissions, reliance was placed on the decision of this Court in case of Fairdeal Supplies Ltd. v. Commissioner of Customs, reported in 2017 (351) E.L.T 220 (Guj).
It was submitted that in similar facts, the Division Bench of this Court relying upon the decision of the Apex Court in case of J.K. Synthetics Ltd. v. Collector, reported in 1996 (86) E.L.T. 472 (S.C), referred to the Rule 41 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982 (For short 'the Rules') to make such order as is necessary to Page 8 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined secure the ends of justice and, therefore, has power to set-aside an order passed ex-parte against the respondent if it is found that the respondent had, for sufficient cause, been unable to appear.
4.2 Reliance was placed in the decision of this Court in case of Ram Kirpal v. Union of India, reported in 1998 (103) E.L.T 8 (Guj) wherein after referring to Rule 41 of the Rules, it is held that in order to advance substantial justice, the Tribunal has wide jurisdiction to do complete justice between the parties.
4.3 It was further submitted by learned advocate Mr. Dave for the petitioner that considering the facts of the case, CESTAT ought to have allowed Misc. Application for recalling its order as there is mistake apparent on record,even if it is admitted by the petitioner before the CESTAT that the change of address was not intimated to the Page 9 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined Registry or the learned advocate or the petitioner has ascertained the date of hearing from the Website. It was submitted that the petitioner Company is now merged with the other Company namely Voltas Ltd. and, therefore, inadvertently the tracking of the pending appeal was lost.
5. On the other hand, learned advocate Mr. Utkarsh Sharma submitted that the petitioner failed to notify the change of address, and therefore the CESTAT had no option but to pass an ex-parte order. It was submitted that it is true that the petitioner did not remain present because of its own negligence and, therefore, the CESTAT was justified in rejecting the application to recall the order.
6. Having heard the learned advocates for the respective parties and considering the facts of the case, it appears that the CESTAT has passed Page 10 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined an ex-parte order in absence of the change of address by the petitioner. However, the CESTAT cannot be said to have become functus officio when it is pointed out to the Tribunal about the mistake committed by applying the Notification No. 50 of 2008 whereby the Rule 6(6) was amended with effect from 31.12.2008 retrospectively and held to be retrospectively in the decisions relied upon by the CESTAT. Thus, the CESTAT has committed mistake apparent on record as pointed out by the petitioner in its Misc. Application.
On perusal of the impugned order, it appears that the CESTAT has not taken into consideration the fact of wrong reliance placed on the decision of the Division Bench in case of M/s. Sujana Metal Products Ltd. v. Commissioner of C. Ex., Hyderabad (Supra) as well as the decision of the Delhi Tribunal in case of Surya Roshni Ltd.
(Supra).
7. This Court in case of Fairdeal Supplies Ltd.
Page 11 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined v. Commissioner of Customs (Supra) in similar facts, has held as under:
"7. Insofar as the last finding recorded by the Appellate Tribunal, viz. that it becomes functus officio and cannot entertain an application for restoration of appeal is concerned, the same is clearly contradictory to the principles enunciated by the Supreme Court in J.K. Synthetics Ltd. v. Collector of Central Excise (supra), wherein it has been held thus:-
"5. Rule 20 of the CEGAT (Procedure) Rules deals with cases where the appellant has defaulted Rule 21 empowers CEGAT to hear appeals ex parte. The fact that Rule 21 does not expressly state that an order on an appeal heard and disposed of ex parte can be set aside on sufficient cause for the absence or the respondent being shown does not mean that CEGAT has on power to do so. Rule 41 gives CEGAT wide powers to make such orders or give such directions as might be necessary or expedient to give effect or in relation to its order or to prevent abuse of its process or most importantly, to secure the ends of justice Page 12 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined
6. If, in a given case, it is established that the respondent was unable to appear before it for no fault of his own, the ends of justice would clearly require that the ex-parte order against him should be set aside Not to do go on the ground of lack of power would be manifest injustice. Quite apart from the inherent power that every tribunal and court constituted to de justice has in this respect, CEGAT is clothed with express power under Rule 41 to make such order as is necessary to secure the ends of justice. CEGAT has therefore, the power to set aside an order passed ex parte against the respondent before it if it is found that the respondent had, for sufficient cause been unable to appear.
7. It is for CEGAT consider in every such case whether the respondent who applies for recall of the ex parte order against him had sufficient cause for remaining absent when it was passed and, if it is established to the satisfaction of CEGAT that there was sufficient cause, CEGAT must set aside the er parte order, restore the appeal Page 13 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined to its file and hear it afresh on merits.
8. On the facts of the present case, we think it proper to allow the appellants' application to CEGAT for setting aside the ex-parte order against it ourselves
9. The appeal is allowed. The order under appeal is set aside. The application of the appellant for recalling the order dated 31st August, 1987, passed by CEGAT ex parte against it is allowed. The appeal (No. 590/84C) before CEGAT is restored to its file and shall be heard and disposed of on merits
8. Thus, the Supreme Court has clearly held that the Appellate Tribunal is clothed with express power under Rule 41 of the CEGAT (Procedure) Rules (now called the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982] to make such order as is necessary to secure the ends of justice and, therefore, has the power to set aside an order passed ex parte against the respondent before it if it is found that the respondent had, for sufficient Page 14 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined cause, been unable to appear.
9. Insofar as the other grounds on which the application has been rejected are concerned, one of the grounds is that the learned advocate for the petitioner had remained consistently absent, whereas, the learned advocate for the petitioner has pointed out the relevant facts which indicate that the aforesaid observations made by the Appellate Tribunal regarding the absence of the learned advocate for the petitioner during the course of hearing are incorrect.
10. What has mostly weighed with the Appellate Tribunal while rejecting the application for recalling the earlier order is that the Bench comprising of the President and the Member (Technical) had arrived at a reasoned decision dated 23-2-2016. In this regard, a perusal of the ex-parte order dated 23-2-2016 passed by the Appellate Tribunal reveals that in the first paragraph it has recorded that there was no appearance on behalf of the appellant on the last two occasions and that the appeal was being taken up for disposal on the basis of records in the second and third paragraphs, the facts of the case have been briefly reproduced in the fourth paragraph, the Appellate Tribunal has recorded that it has heard the authorised Page 15 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined representative who has reiterated the findings of the Commissioner (Appeals) in the impugned order in appeal In Paragraph 5, the Appellate Tribunal has by and large reproduced the observations made by the adjudicating authority in the order-in-original dated 8-1-2017. In Paragraph 6, the Appellate Tribunal has reproduced the observations made by the Commissioner (Appeals) in the order-in-appeal and in the last paragraph has merely observed that in the above analysis, it found that the impugned orders are unassailable in the facts and circumstances of the case. In the entire order, there is not even a sentence discussing the merits of the appeal preferred by the petitioner. There is no reference to any ground raised by the petitioner in the appeal memorandum or any independent finding of the Appellate Tribunal. The Appellate Tribunal has merely reproduced extracts of the order-in- original and the order-in-appeal and has upheld the same stating that the impugned orders are unassailable. Though the Appellate Tribunal has used the expression, "in view of the above analysis", there is no analysis worth the name reflected in the said order. Clearly therefore, the order dated 23-2-2016 passed by the Appellate Tribunal is a non-reasoned and non- speaking one. The observation made by the Appellate Tribunal in the impugned order to the Page 16 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined effect that the Bench comprising of the President and the Member (Technical) had arrived at a reasoned decision dated 23-2-2016, is therefore, not borne out from the record.
11. In the light of the law laid down by the Supreme Court in the case of JK. Synthetics Ltd. v. Collector of Centrai Excise, (supra), wherein the Supreme Court has held that the fact that Rule 21 does not expressly state that an order on an appeal heard and disposed of ex-parte can be set aside on sufficient cause for the absence of the respondent being shown does not mean that CEGAT has no power to do so. Rule 41 gives CEGAT wide powers to make such orders or give such directions as might be necessary or expedient to give effect or in relation to its order or to prevent abuse of its process or, most importantly, to secure the ends of justice. The Court has held that CEGAT is clothed with express power under Rule 41 to make such order as is necessary to secure the ends of justice and, therefore, has the power to set aside an order passed ex parte against the respondent before it if it is found that the respondent had, for sufficient cause, been unable to appear.
12. Having regard to the averments made in the memorandum of petition as well as in the Page 17 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined application filed before the Appellate Tribunal, the Court is of the view that the petitioner had made out sufficient cause for not remaining present when the order dated 23-2-2016 was passed, and hence, the Appellate Tribunal was not justified in not recalling its earlier order and restoring the appeal preferred by the petitioner."
8. In case of Ram Kirpal v. Union of India (Supra), this Court has held as under:
"6. In our view, the decision relied upon by the learned Counsel for the petitioner are not applicable to the facts of the present case, and therefore of no assistance to the petitioner. As a general rule, a judgment, decree or final order once drawn up and signed, cannot subsequently be altered, varied or amended in any manner by the Court or Tribunal which pronounced it. However, there is well recognized exception to the said general rule. It is a maxim of law that an act of a Court shall prejudice no man actus curiae neminem gravabit. Every Tribunal has an inherent jurisdiction, apart from statutory jurisdiction to correct any error committed by itself. It can invoke such jurisdiction and can exercise it in an appropriate case when its conscience is aroused Page 18 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined and if it considers that without the exercise of such powers, the ends of the justice would be frustrated. The whole jurisdiction of the Tribunal is to pass a just order in the larger interest so that justice is done both to the assessee and the revenue. It would be instructive to notice Rule 41 of the Customs Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982 which is as under:
"The Tribunal as may make such orders or give such directions as may be necessary or expedient to give effect or in relation to its orders or to prevent abuse of its process or to secure the ends of justice."
By enacting Rule 41 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982, the legislature has advisedly invested the Tribunal with a very wide jurisdiction to do complete justice between the parties. In Grindlays Bank Ltd. v. Central Government industrial Tribunal and Others, 1980 (Supplement) Supreme Court Cases 420, the Supreme Court considered the question as to whether the Tribunal constituted under the provisions of Industrial Disputes Act, has power to set aside an ex-parte order in absence of express provisions in the Act or the Rules framed thereunder or not. The Supreme Court has Page 19 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined held that a Tribunal or body should be considered to be endowed with such ancillary or incidental powers as are necessary to discharge its functions effectively for the purpose of doing justice between the parties. The Supreme Court found that there was no express provision in the Act or rules framed thereunder giving the Tribunal jurisdiction to set aside its ex-parte award and even then it has been held that the Tribunal should be considered as invested with such incidental or ancillary powers unless there is any indication in the status to the contrary. After examining the meaning of word "review", it has been held therein that the expression "review" is used in the two distinct senses, namely, (1) a procedural review which is either inherent or implied in a Court or Tribunal to set aside a palpably erroneous order passed under a misapprehension by it, and (2) a review on merits when the error sought to be corrected is one of law and is apparent on the face of the record. The Supreme Court has further held that, when a review is sought due to a procedural defect, the inadvertent error committed by the Tribunal must be corrected ex debeito justitiae to prevent the abuse of its process, and such power inheres in every Court or Tribunal. The principle that the power to review must be conferred by statute either specially or by necessary implication is inapplicable to Page 20 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined decisions of Judicial Tribunal which is supposed to do complete justice to the parties before it. To extend the principle to decisions rendered by Judicial Tribunal would indeed lead to untoward and startling results. Merely any Judicial Tribunal must be free to review its decision if it has to dispense justice to the parties though of course principles of fair play should be observed. The law on the subject has been reviewed and stated by the Supreme Court in its judgment rendered in the case of S. Nagaraj and Others v. State of Karnataka and Another, JT 1993 (5) SC 27 In para 18 of the judgment, the Supreme Court has held as under
"Justice is a virtue which transcends all barriers Neither the rules of procedure nor technicalities of law can stand Justice in its way. The order of the Court should not be prejudicial to anyone. Rule of stare decisis is adhered for consistency but it is not as inflexible in Administrative Law as in Public Law. Even the law bends before justice. Entire concept of writ jurisdiction exercised by the higher courts is founded on equity and fairness. If the Court finds that the order was passed under a mistake and would not have exercised the jurisdiction but for the erroneous assumption which in fact did not exist and its perpetration shall result in miscarriage of justice then it cannot on en it Page 21 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined cannot on any principle be prejudiced from rectifying the error. Mistake is accepted as valid reason to recall an order Difference lies in the nature of mistake and scope of rectification, depending on if it is of fact or law. But the root from which the power flows is the anxiety to avoid injustice. It is either statutory or inherent. The latter is available where the mistake is of the Court. In Administrative Law the scope is still wider Technicalities apart if the Court is satisfied of the injustice then it is its constitutional and legal obligation to set it right by recalling its order."
In para 19 of the said judgment, the Supreme Court has further observed as under:
"Review literally and even judicially means re-examination or re-consideration Basic philosophy inherent in it is the universal acceptance of human falibility. Yet in the realm of law the courts and even the statutes lean strongly in favour of finality of decision legally and properly made. Exceptions both statutorily and judicially have been carved out to correct accidental mistakes or miscarriage of justice. Even when there was no statutory provision and no rules were framed by the Highest court indicating the circumstances in which it could rectify its order the courts called out such power to avoid abuse of process Page 22 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined or miscarriage of justice. In Raja Prithvi Chand Lal Choudhury v. Sukhraj Rai and Others, AIR 1941 Federal Court 1, the Court observed that even though no rules had been framed permitting the highest court to review its order yet it was available on the limited and narrow ground developed by the Privy Council and the House of Lords. The Court approved the principle laid down by the Privy Council in Rajunder Narain Rao v. Bijai Govind Singh 1 Moo PC 117 that an order made by the Court was final and could not be altered.
Nevertheless, if by misprision in embodying the judgments, errors have been introduced, these Courts possess by Common law, the same power which the Courts of record and statute have of rectifying mistakes a made in drawing up its own judgments, and this Court must possess the same authority. The Lords have however gone a step further, and have Buced through inadvertence in the details of judgments, or have supplied manifest defects in order to enable the decrees to be enforced, or have added explanatory matter, or have reconciled inconsistencies Basis for exercise of the power was stated in the same decision as under corrected mistake introduced "It is impossible to doubt that the indulgence extended in such cases a mainly owing to the natural desire prevailing to Page 23 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined prevent irremediable injustice being done by a Court of last resort, where by some accident, without any blame, the party has not been heard and an order has been inadvertently made as if the party had been heard."
"Rectification of an order thus stems from the fundamental principle that justice is above all It is exercised to remove the error and not for disturbing finality."
Thus, it becomes clear that the uppermost anxiety in the mind of the Court should be to do complete justice of the Court or Tribunal between the parties and when the Court finds that the mistake has crept in inadvertently, it is duty of the Court or Tribunal to correct it for doing complete justice between the parties in view of the principle laid down by the Supreme Court in the above-quoted decisions, we are of the opinion that, the power of review is available to the Tribunal and it cannot be said that the order passed by the Tribunal is without jurisdiction. Again in the case of J.K. Synthetics Limited (supra), the respondent was unable to appear before the Tribunal for no no fault of his own. The ends of justice clearly required that the ex parte order passed against him should have been set aside. However, the Tribunal refused to set aside the ex parte order Page 24 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined passed on merits holding that Rule 21 of Customs Excise and Gold (Control) Appellate Tribunal (Procedure) Rules 1982 which empowers the Tribunal to hear appellant ex parte did not expressly state that an order on an appeal heard and disposed of ex parte could be set aside by cause being shown by the respondent. The Supreme Court has construed the provisions of Rules 20, 21 and 41 of the Customs Excise and Gold (Control) Appellate Tribunal (Procedure) Rules 1982 and held that, the Tribunal is clothed with express power under the Customs, Excise & Gold Appellate Tribunal (Procedure) Rules to make such order as is necessary to secure the ends of justice and the Tribunal has, therefore, the power to set aside an order passed ex parte against a party before it if it is found that the party had, for sufficient cause, been unable to appear It is further observed that the fact that Rule 21 does not expressly state that an order passed in an appeal heard and disposed of ex parte can be set aside on sufficient cause for the absence of the respondent being shown does not mean the Tribunal has no power to do so. What is stressed by the Apex Court is that quite apart from the inherent power that every Tribunal or court to do justice has, if it is established to the satisfaction of the Tribunal that there was sufficient cause, the Tribunal must set aside the ex parte order, restore the Page 25 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined appeal to its the and hear it fresh on merits. In view of the principle laid down by the Supreme Court in the above-noted decision, there is no manner of doubt that power to recall or review its earlier order is available to the Tribunal for doing complete justice between the parties and the impugned order cannot be regarded as having been rendered without jurisdiction.
7. The contention that that there was no error apparent on the face of the record committed by the Tribunal while passing order dated April 24th, 1997, and therefore, rectification application ought to have been dismissed has no substance at all. In the Rectification Application,it was specifically pleaded by the respondent that a mistake had crept in, in Para 3 of the judgment dated April 24, 1997, wherein, it was stated by the Tribunal that no evidence had been produced by the department indicating that identical goods were being sold at Rs 50/- or Rs. 60/- per kg in the market. The Tribunal after perusing the order has found that the observation made by the Tribunal in its order dated April 24th, 1997, was not in conformity with the facts and evidence discussed by adjudicating authority in the order-in-original. Under the circumstances, the Tribunal has Page 26 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined recalled its earlier order by holding that the mistake had crept in while passing the order on April 24th, 1997, Having regard to the facts and circumstances of the case, it cannot be said that the error which is noticed. by the Tribunal is not self-evident and could have been decided only by process of reasoning. This is a case of procedural review which is inherent or in any view of the matter implied in the Tribunal to set aside palpably erroneous order passed under a misapprehension by The Tribunal has found that the order recalled was passed under a mistake. The reasonable reading of the impugned order indicates that the Tribunal would not have exorcised jurisdiction in favour of the petitioner, but for the erroneous assumption which in fact did not exist. The power of review which inheres in every Court or Tribunal of plenary jurisdiction is exercised by the Tribunal to prevent miscarriage of justice and to correct grave and palpable error committed by id it is exercised to secure the ends of justice within meaning of Rule 41 of the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules, 1982. It is not exercised on the ground that the decision called was erroneous on merits. We are of the view that the Tribunal has not confused its power to review its earlier order with appellate power. Though in the case of A.T. Sharma (supra) Supreme Court Page 27 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined has held that powers of review available High Court under Article 226 of the Constitution, are analogous to provisions of Order 41 Rule 1 CPC, in earlier decision rendered in the case of Shivdeo Singh v State of Punjab AIR 1963 Supreme Court 1909, the Constitution Bench of Apex Court has defined powers of review available to the High Court under Article 226 of the Constitution and ruled that there is clothing in Article 226 of the Constitution to preclude a High Court from exercising the power of review which inheres in very court of plenary jurisdiction to prevent miscarriage of justice or to correct grave and palpable errors committed by it. Even in subsequent decision, i.e. in case of Grindlays Bank Ltd. (supra), the Apex Court has explained that the expression view is used in the two distinct senses namely, (1) a procedural review which is either inherent or implied in a Court or Tribunal to set aside a palpably erroneous order passed under a misapprehension by it and (2) a review on merits when the error sought to be corrected is one of law and is apparent on the fact of the record. As held earlier, this case of procedural review and not case of review on merits where error of law apparent on the the face of the record is sought to be corrected. Therefore decision rendered in case of A.T. Sharma (supra) cannot be made applicable to the facts of the present case Page 28 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined Similarly, though provisions of Section 254(2) of the Income Tax Act and Section 1298(2) of the Customs Act are similar, we are unable to persuade ourselves to follow decision of the Delhi High Court rendered in case of Deeasha Suri (supra) because principles of law laid down by the Apex Court in case of Grindlays Bank Ltd (supra) and S. Nagaraj and Others (supra) are not taken into consideration by Delhi High Court while interpreting Section 254(2) of the come Tax Act. Even otherwise said decision has persuasive value and not binding on this Court. On perusal of the order dated April 24th 1997 itself, the Tribunal noticed that the finding recorded against the respondent by the Tribunal was not in conformity with the facts and evidence on record, and therefore, it cannot be said that an error necessitating interference of the Court under Article 227 of the Constitution of India. As held in Nilkanth v. State of Bihar- AIR 1962 Supreme Court 1835, the power under Article 227 is exercised by the Court in its discretion and cannot be claimed as of right by any party. Therefore even if one agrees with the submission of the petitioner that the Tribunal has no jurisdiction to recall or review its earlier order, the impugned decision cannot be interfered with on a merely technical ground which does not advance substantial justice. Under the circumstances, we are of the opinion, Page 29 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined that no case is made out by the petitioner of interfering with the impugned order, and, therefore, the petition is liable to be dismissed."
9. In view of the above, when it is not disputed by the respondent about the fact that the petitioner could not remain present, coupled with the fact that the petitioner could have represented its case on merits, the CESTAT ought to have exercised its power under Rule 41 of the Rules so as to render the substantial justice.
Rule 41 of the Rules, 1982 reads as under:
"The Tribunal as may make such orders or give such directions as may be necessary or expedient to give effect or in relation to its orders or to prevent abuse of its process or to secure the ends of justice."
10. In view of the above Rules, the CESTAT ought to have recalled its Order-in-Appeal as the CESTAT has ample power to pass an order as is necessary to secure the ends of justice and, Page 30 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined therefore, has the power to set aside an order passed ex-parte against a party before it, if it is found that the party had sufficient cause to unable to appear. In the facts of the case, the petitioner could not appear as the address could not be changed after the merger of the petitioner Company with the other Company and, therefore, it can be said to be sufficient cause for the absence of the petitioner. Moreover, in the facts of the case, in the Order-in-Appeal also the petitioner has been able to point out the mistake apparent on record in its application for recall of the Order-in-Appeal, which the CESTAT has not considered at all while passing impugned order.
The CESTAT, therefore, ought to have set-aside the ex-parte order and restored the appeal to its file and hear it fresh on merits.
11. In view of the decision in similar facts, we are of the opinion that the impugned order is liable to be quashed and set-aside, as held by Page 31 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined the Supreme Court as well as this Court that power to recall or review its earlier order is available to the CESTAT for doing complete justice to the parties and the CESTAT cannot be said to have become functus officio after passing the Order-in-Appeal.
12. Therefore, considering the averments made in this petition as well as application filed before the CESTAT, we are of the opinion that the petitioner has made out a sufficient cause for not remaining present when the Order-in-Appeal was passed as well as on merits to point out that there was mistake apparent on record in Order-in-
Appeal. The CESTAT is not justified in not recalling the earlier order in restoring the appeal in earlier order.
13. In view of the foregoing reasons, the impugned order dated 31.1.2025 passed by the CESTAT in Excise Misc. Application No. 10042 of Page 32 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025 NEUTRAL CITATION C/SCA/10869/2025 ORDER DATED: 09/10/2025 undefined 2024 is hereby quashed and set-aside and the matter is restored back to the CESTAT. The petition, therefore, succeeds and is accordingly allowed. Rule is made absolute to the aforesaid extent. No order as to costs.
(BHARGAV D. KARIA, J) (PRANAV TRIVEDI,J) SAJ GEORGE Page 33 of 33 Uploaded by SAJ GEORGE(HC01069) on Thu Oct 16 2025 Downloaded on : Thu Oct 16 21:31:18 IST 2025