Violation of principles of natural justice, denial of cross-examination, and non-granting of effective personal hearing led to the quashing and setting aside of the impugned order.

ORDER :

SONIA GOKANI, J.

1. The petitioners are before this Court challenging the ex-parte Order-in-Original No. AHM-EXCUS-003-COM-027- 28.02.2021 dated 04.09.2020 passed by the Commissioner Central GST and Central Excise, Gandhinagar Commissionerate, Ahmedabad allegedly in gross violation of principles of natural justice without hearing the petitioners or its authorized representatives.

2. The brief facts leading to the present petition are as follows:

2.1 One of the petitioners - M/s Gyscoal Limited, is a company incorporated under Companies Act., for manufacture their final goods i.e. products of stainless Steel falling under Ch. 72 of CETA, the other petitioner i.e. Viral Shah is the Director of Gyscoal Ltd, Mr. Prakashsingh Solanki is the employee of Gyscoal Limited and Rest Petitioners i.e. Tvisha, Magna Vision and Superfine are the suppliers of raw material to the Gyscoal Ltd.

2.2 As averred by the petitioner - Gyscoal Ltd that, the officers of the Central Excise Department carried out the search in the premises of M/s. Gyscoal Limited and withdrew their record under the panchanama. As regards other petitioners, their statements are recorded. The suspicion on the part of the Excise Officers is that M/s.Gyscoal Limited only received the central excise invoices without supply of goods mentioned therein and other petitioners viz., Magna Vision, M/s.Twisha and Superfine have only supplied the invoices and not the goods. Therefore, M/s Gyscoal Limited has availed Cenvat Credit of excise duty without receipt of goods mentioned in the invoices. The allegation against M/s. Twisha, Superfine, and Magna Vision is that they abated with M/s.Gyscoal Ltd., to facilitate M/s. Gyscoal to avail ineligible cenvat credit.

2.3 The entire Show Cause Notice is based on the Statements recorded under Section 14 of Central Excise Act and the impugned order has confirmed the demand qua M/s.Gyscoal Limited on the basis of those statements which are not subjected to cross examination.

2.4 Further, looking to the date chart that the opportunity of personal hearing was only granted during nationwide lockdown. Copy of the said date chart are attached herewith.

2.5 A copy of show cause notice was provided without relied upon documents which were submitted upon the request by petitioner/s. Subsequently, the hearing was granted on 27.01.2020, 10.03.2020 (public holiday), 19.03.2020, 17.04.2020, 05.08.2020, 11.08.2020, 20.08.2020, which were physical hearing and during nationwide lockdown. The petitioners have replied their show cause notices prior to 11.08.2020. They have filed application for cross examination which are received by the respondent as per their affidavit in reply.

2.6 Except main noticee - M/s Gyscoal Alloys Ltd., an opportunity of hearing was not granted on 20.08.2020, whereas main noticees, as per the record of hearing in impugned order, was heard. Further, main noticee has drawn attention to the fact on record that on 20.08.2020, actual hearing that took placed was regarding only one show cause notice dated 28.07.2016 i.e. proposing seizure, confiscation and penalty and as regards show-cause notice dated 02.04.2018, advocate for the main noticee / petitioner i.e. M/s.Gyscoal Alloys Ltd. has submitted written submissions in respect of application for cross-examination and requested for hearing of the application for cross-examination. The said fact is admitted in para 38.2 of the impugned order. It has been further stated that the final hearing of show-cause notice dated 02.04.2018 did not took place and record of hearing giving reference to only final hearing of show cause notice dated 02.04.2018 was reverted for correction by the advocate of the petitioner, wherein it is stated that hearing took place of only one show cause notice dated 28.07.2016 which has been clearly mentioned. The impugned order has not referred to the said email for correction of record of hearing.

2.7 It has been further contented that in case of all the petitioners, rep