2013 (8) TMI 93 - HC - Central Excise

Circular No.967/01/2013-CX dated 01.01.2013 Recovery - The circular obligating the concerned authorities to initiate recovery proceedings on the expiry of period as mentioned therein so far as it relates to the situations where appeals with stay applications have been filed, but no stay had been granted and the stay applications had been kept pending for reasons not attributable in any manner whatsoever to the petitioners/assessees and resultantly, no interim relief had been granted, is non est Held that - recovery proceedings stayted - (i) In each case of the petitioners herein, the concerned Appellate Authority shall fix a date for hearing on the stay application/s immediately, if not already fixed and shall inform the concerned petitioner accordingly; (ii) The parties shall appear before the concerned Appellate Authority on the date so fixed for hearing on the stay application; (iii) The stay application shall be heard and disposed of at the earliest by the Appellate Authority, preferably within a period of six weeks from the date of hearing; (iv) The respondent-Department shall not adopt coercive recovery proceedings in relation to the amount in question until final disposal of the stay application/s by the concerned Appellate Authority Decided in favor of Assessee.

Summary

Issues:
1. Grievance of petitioners regarding pending appeals and coercive recovery.
2. Validity and impact of Circular No.967/01/2013-CX dated 01.01.2013.
3. Judicial intervention and directions regarding stay applications and recovery proceedings.

Issue 1: Grievance of petitioners regarding pending appeals and coercive recovery:
The three writ petitions involved similar issues where petitioners had filed appeals against orders-in-original but faced coercive recovery despite pending appeals and stay applications. The petitioners complained that despite the pendency of their appeals and requests for interim relief, the respondents proceeded with coercive recovery measures, citing Circular No.967/01/2013-CX dated 01.01.2013.

Issue 2: Validity and impact of Circular No.967/01/2013-CX dated 01.01.2013:
The court referred to a previous judgment in the case of Manglam Cement Ltd. vs. The Superintendent, Central Excise Range-III, Kota & Ors., where it was held that the impugned Circular was inapplicable in situations where appeals with stay applications were pending due to reasons not attributable to the assessees. The court directed that no coercive steps for recovery should be initiated in such cases until the appeals and interim applications were heard promptly, preferably within three weeks. The court clarified that its decision did not comment on the merits of the appeals.

Issue 3: Judicial intervention and directions regarding stay applications and recovery proceedings:
In subsequent cases, including DBCWP No.3776/2013 and CWP No.8872/2013, the court reiterated the stance taken in the Manglam Cement case. It directed the Appellate Authorities to fix dates for deciding stay applications along with appeals promptly and instructed that the stay applications be heard and disposed of within a specified timeframe. The court further restrained the Department from making any recovery until the final disposal of the stay applications by the concerned Appellate Authority.

In conclusion, the court allowed the petitions, directing the concerned Appellate Authorities to expedite the hearing of stay applications, ensuring that coercive recovery proceedings were stayed until the final disposal of the stay applications. The court emphasized prompt adjudication of appeals and stay applications while restraining the Department from taking coercive recovery actions.