2004 (8) TMI 488 - AT - Central Excise

Summary

Issues:
Extension of stay of recovery during the pendency of appeal.

Analysis:
The matter involved an application for the extension of stay of recovery by the appellants. Initially, the application was not granted as no demand notice had been issued by the department. However, later it was revealed that a demand notice had been received by the appellants. The Deputy Commissioner had issued a letter sanctioning an amount towards the rebate claimed by the appellants but also proceeded to appropriate this amount towards the duty confirmed against the assessee under the impugned order. The Tribunal noted that the Deputy Commissioner's actions did not meet the ends of justice as the order sanctioning the rebate was appealable and had not attained finality. The Tribunal considered that the Deputy Commissioner's actions virtually defeated the interest of the Revenue. In light of these considerations, the Tribunal granted the extension of stay of recovery as requested by the appellants.

The Tribunal referred to a previous decision by a Larger Bench in the case of IPCL v. CCE, Vadodara, which held that the Tribunal has inherent jurisdiction to extend the stay of recovery during the pendency of an appeal. In the present case, the Tribunal highlighted that the Deputy Commissioner's letter, which sanctioned the rebate claimed by the assessee, was still subject to appeal. The Tribunal found fault with the Deputy Commissioner's immediate appropriation of the sanctioned amount towards the duty confirmed against the assessee, as it prejudiced the Revenue's interest. Additionally, the Deputy Commissioner's demand for the balance amount of duty was deemed unjust and contrary to the principles of justice. Consequently, the Tribunal, after hearing submissions from both parties, decided to grant the extension of stay of recovery in the interest of justice.

In conclusion, the Tribunal's decision to grant the extension of stay of recovery was based on the Deputy Commissioner's premature actions in appropriating the sanctioned amount towards the duty confirmed against the assessee, which was still subject to appeal. The Tribunal emphasized the importance of upholding the principles of justice and ensuring that the interests of all parties, including the Revenue, were protected during the appeal process.