The court emphasizes that rectification applications should be considered on merits, not barred by limitation when liberty to file was granted.

CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA and HONOURABLE MR. JUSTICE PRANAV TRIVEDI Date : 03/10/2025 ORAL COMMON JUDGMENT (PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)

1. Heard learned advocate Mr. Dhaval Shah for learned advocate Mr. Paresh V. Sheth for the appellants and learned advocate Mr. Hardika Vyas for the respondent.

2. The Tax Appeals are admitted on the following substantial question of law by order dated 08.07.2008 :-

“Whether, in the facts and circumstances of the case, the Customs, Excise and Service Tax Appellate Tribunal, was justified in law after granting liberty to the appellant to file a fresh application for rectification of mistake in the ex-parte order, and thereafter, once the appellant had moved the rectification application, treat such rectification application as barred by limitation?”

3. It appears that by order dated 22.03.2007 the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench, Ahmedabad (For Short “CESTAT”) disposed of Customs Appeal Nos. 126 to 131 of 2003. The CESTAT by common order 22.03.2023 allowed the appeals filed by the Customs Department by confirming the demand and penalties imposed in the Order-in-Original by restoring the demand duty and penalty imposed in the Orders-in-Original. The CESTAT passed the said order in absence of the learned advocates for the appellant. The Commissioner (Appeals) set aside the Order-in-Original on the ground that the appellants have imported the goods on the DEPB License issued by the Director General of Foreign Trade, New Delhi in favour of M/s. Million Dollars Inc. and Ors. and subsequently such licenses were found to be forged. The CESTAT in the ex-parte order held as under :-

“6. It, however, appears from the orders-in-original that the Importers have been imposed penalty under Section 112 twice. In the order-in-original, while ordering confiscation of the goods, a penalty of Rs. 20,00,000/- (Appeal No. C/126/03) was imposed under Section 112 of the Act; and simultaneously at Item No. 7, the importer is again imposed a penalty of Rs, 11,14,739/- under Section 112 of the Act. In the order-in-original, while ordering confiscation of the goods, a penalty of Rs. 4,52,636/- (Appeal No. C/127/03) was imposed under Section 112 of the Act; and simultaneously at Item No. 6, the importer is again imposed of the same a penalty amount under Section 112 of the Act. Similarly, in order-in-original, which is the subject matter of Appeal No. C/128/03, a penalty of Rs. 18,50,000/- was imposed under Section 112 of the Act on the ground that the goods were not available for confiscation and again a penalty of Rs. 7,31,704/- was imposed on the importer under Section 112 of the Act at Item No. 6 of that order. Likewise, in order-in-original, which is the subject matter of Appeal No. C/129/03, a penalty of Rs. 18,50,000/- was imposed under Section 112 of the Act on the ground that the goods were not available for confiscation and again a penalty of Rs. 7,12,331/- was imposed on the importer under Section 112 of the Act at Item No. 6 of that order. Further, in order-in-original, which is the subject matter of Appeal No. C/130/03, a penalty of Rs. 7,20,000/- was imposed under Section 112 of the Act on the ground that the goods were not available for confiscation and again a penalty of Rs. 2,54,0387- was imposed on the importer under Section 112 of the Act at Item No. 6 of that order. Similarly, in order-in-original, which is the subject matter of Appeal No. C/131/03, a penalty of Rs. 36,4