1983 (6) TMI 196 - AT - Central Excise

Summary

Issues:
1. Stay of redemption fine and penalty order by Gold Control Administrator.
2. Appellate Tribunal's power to grant stay.
3. Imposition of penalty and hardship faced by the appellants.
4. Providing safeguard for revenue recovery in case of appeal failure.
5. Requirement of bank guarantee and bond for penalty stay.

Analysis:
The judgment pertains to a petition filed for the stay of an order by the Gold Control Administrator requiring the appellants to pay a redemption fine of Rs. 25,000 and a penalty of Rs. 2,00,000. The petitioners, in their plea, expressed their inability to pay the said amount and highlighted the significant hardship it would cause. The consultant for the petitioners reiterated these points and requested a stay in the interest of justice.

The Tribunal observed that the Act does not mandate the deposit of the redemption fine for considering an appeal. However, the Gold Control Administrator's order stated that non-payment of the redemption fine within three months would lead to confiscation becoming absolute. To prevent the appeal from becoming infructuous, the Tribunal held that it has the inherent power to grant a stay. Consequently, the Tribunal unconditionally stayed the part of the order related to the redemption fine to ensure the appeal's efficacy.

Regarding the penalty, the Tribunal acknowledged the harshness of requiring the appellants to deposit the amount. The petitioners' assertion that they could not afford the penalty even by liquidating all their assets remained unchallenged. Recognizing the appellants' right to appeal as a substantive right, the Tribunal balanced the interests of the revenue by directing the appellants to provide a bank guarantee of Rs. 1 lakh and execute a bond with a solvent surety for the remaining sum of Rs. 1 lakh.

In conclusion, the Tribunal allowed the application and directed the stay of the penalty recovery of Rs. 2 lakhs. The appellants were instructed to furnish a bank guarantee for Rs. 1 lakh and execute a bond with a solvent surety for the remaining sum within four weeks from the order's communication to the satisfaction of the adjudicating authority. This decision aimed to address the undue hardship faced by the petitioners while safeguarding the revenue interests in case of appeal failure.