Review by Chief Commissioners - how will it work?
THE Finance Bill proposes to amend the Customs Act and the Central Excise Act to provide for review of orders passed by Commissioners and Commissioners (Appeals) by a Committee of two Chief Commissioners constituted by the Board. Though this is a welcome step as a committee is more likely to take a more judicious decision than a single officer, for the simple reason that responsibility and burden are shared, the actual working of the scheme is bound to lead to difficulties.
An appeal against the order of a Commissioner (Appeals) has to be filed with the Tribunal within three months from the date of communication of the order to the Commissioner. {Section 35B(3) of the Central Excise Act}. But as per the proposed amendment to section 35A, by clause 78 of the Finance Bill, the Commissioner (Appeals) is not required to send a copy of his order to the Commissioner. He should send it to the Chief Commissioner. So the Commissioner never gets the copy of the order and he can wait till eternity to get that order and then wait for another three months to direct a Central Excise officer to file an appeal with the Tribunal. No, there is something wrong here. Now the direction to file the appeal has to be given by the Committee of Chief Commissioners and not the Commissioner. I am not trying to confuse you; I am only trying to inform the Board that somebody forgot to amend Section 35 B(3). So the situation after the Finance Bill becomes Act would be like this.
1. Commissioner(Appeals) passes an order;
2. He is required to send a copy of his order to the Chief Commissioner (mind you, not the Commissioner);
3. The order is to be reviewed by the Committee of Chief Commissioners constituted by the Board;
4. This Committee if it finds the order bad will direct a Central Excise officer to file an appeal to the Tribunal.
5. The appeal to the Tribunal is to be made within three months from the date of communication of the order to the Commissioner (AND IT IS NEVER COMMUNICATED TO THE COMMISSIONER).
Assuming this is a minor lapse, which will be corrected before the Bill becomes Act, there are other real problems. The order of the Commissioner (Appeals) goes to the Chief Commissioner and now the Committee constituted by the Board has to start working. The order and the connected files have to be sent to the two Chief Commissioners and then they have to decide whether to go in appeal or not and then direct a Central Excise officer to file the appeal. And the whole process has to be completed within three months! An almost impossible situation in Government. Who will monitor as to which file is pending with which Chief Commissioner? And what happens if the two Chief Commissioners have a difference of opinion between them? One says, file the appeal and the other says, NO. Refer to a third Chief Commissioner? But the law is silent on this. And the problem has to be solved within three months.
The issue is much simpler in respect of orders passed by Commissioners. Here the Committee has a whole year to confabulate, but here also what will happen if the Chief Commissioners differ?
These provisions come into force in another two and a half months and the Board should sort out these difficulties before the provisions are enacted. One possibility could be to have two Chief Commissioners exclusively for review for every Commissioner in the country!