Appellate Tribunal – Rectification of Mistake –Issue of limitation of demand raised but not considered – Rectification justified – Section 35C(2) of Central Excise Act, 1944.

The
question that arose in the appeal was whether or not the exercise of
jurisdiction u/s. 35C (2) of the Act by the Tribunal to rectify an error
is justified .

By a final order dated 1st September, 2004
passed u/s. 35C of the Act, the Tribunal inter alia, upheld the duty
demand of Rs. 42.07 lakh. On 27th December 2004, the Respondent-Assessee
filed an application for rectification of mistake u/s. 35C(2) of the
Act seeking to rectify the order dated 1st September 2004. In its
rectification application, the Respondent-Assessee pointed out that
though the issue of limitation was raised before the Tribunal and also
urged at the hearing, the order did not deal with the same, thus leading
to an error apparent from the record warranting rectification of the
final order dated 1st September, 2004 of the Tribunal.

On 20th
December, 2005, the Tribunal after hearing the parties, allowed the
application for rectification of the mistake and held that the longer
period of limitation was not invocable in the present facts.
Consequently, the duty demand was reduced on appeal by revenue.

The
Hon’ble Court observed that the jurisdiction of the Tribunal u/s.
35C(2) of the Act is to rectify mistakes apparent from the record i.e.,
the mistake must be obvious and selfevident. The discovery of mistakes
must not require a long process of reasoning. The question whether there
is a mistake in the order sought to be rectified or not should not be a
subject of debate. Once a mistake is brought to the notice of the
Tribunal, it is duty bound to correct the mistake in its order, where an
issue has been argued and/ or submission made on the issue and the same
is not recorded and/or considered in the order, it follows that there
is a mistake apparent from the record.

Thus, non-consideration
of an issue urged before the Tribunal but not dealt with by it would
give rise to a mistake apparent from the record.