M/s Chemipol vs. UOI (Bombay High Court)

DATE: (Date of pronouncement)
DATE: December 12, 2009 (Date of publication)

Click here to download the judgement (chemipol_dismissal_appeal_tribunal.pdf)

Tribunal has inherent power to dismiss an appeal for non-appearance of appellant

The Tribunal dismissed the excise appeal of the assessee for non-appearance. The application filed by the assessee for restoration of the appeal was also dismissed. The dismissal was challenged before the High Court on the ground that under s. 35C of the Excise Act (corresponding to s. 254 of the Income-tax Act) the Tribunal had no power to dismiss an appeal for non-appearance of the Appellant. It had to decide on merits. HELD:

(i) In Chenniappa Mudaliar 74 ITR 41 the Supreme Court struck down R. 34 of the Tribunal Rules, 1946 (now Rule 24) and held that the Tribunal had no power to dismiss an appeal for non-appearance of the Appellant. This view has been followed in the context of the Excise Act in Viral Laminates 100 E.L.T. 335 (Guj.) and Prakash Fabricators & Galvanizers 130 E.L.T 433 (Del.).

(ii) While not inclined to depart from the view taken by the two High Courts, reference must be made to Sunderlal Vs. Nandramdas AIR 1958 MP 260 where it was observed that though the Act does not give any power of dismissal, it is axiomatic that no court or tribunal is supposed to continue a proceeding before it when the party who has moved it has not appeared nor cared to remain present. The dismissal, therefore, is an inherent power which every tribunal possesses. This was approved in Dr. P. Nalla Thampy Vs. Shankar 1984 (Supp) SCC 631. In New India Assurance vs. Srinivasan (2000) 3 SCC 242, it was held that every court or judicial body or authority, which has a duty to decide a lis between two parties, inherently possesses the power to dismiss a case in default. Where a case is called up for hearing and the party is not present, the court or the judicial or quasi judicial body is under no obligation to keep the matter pending before it or to pursue the matter on behalf of the complainant who had instituted the proceedings. That is not the function of the court or, for that matter of a judicial or quasi judicial body. In the absence of the complainant, therefore, the court will be will within its jurisdiction to dismiss the complaint for non prosecution.

(iii) Accordingly, though the Rule conferring power on the Tribunal has been struck down, one cannot altogether lose sight of the rule that every court or tribunal has an inherent power to dismiss a proceeding for non prosecution when the petitioner/appellant before it does not wish to prosecute the proceeding. In such a situation, unless the statute clearly requires the court or tribunal to hear the appeal / proceeding and decide it on merits it can dismiss the appeal / proceeding for non-prosecution. The power must be exercised judiciously and taking into consideration all the facts and circumstances of the case.

Note: Rule 24 of the Tribunal Rules requires that the appeal be disposed of on merits if the appellant is not present. See also Tribhuwan Kumar 294 ITR 401 (Raj) and Rajendra Prasad Borah 302 ITR 243 (Gau) where it was held that the Tribunal could not dismiss the appeal for non-appearance. Multiplan 38 ITD 320 (Del) was impliedly held not to be good law.