2012 (4) TMI 512 - AT - Central Excise

Restoration of appeal - Held that - bare reading of ECIL 2011 (2) TMI 3 - Supreme Court judgment would show that vide this judgment Supreme Court has recalled its earlier order passed in ONGC (1991 (10) TMI 58 - SUPREME COURT OF INDIA) matters pursuant to which COD was created. In our considered view effect of the Supreme Court recalls the orders passed in ONGC matter (supra) is that these orders are no more in force. Thus on the strength of these recalled orders the appellants cannot be denied their right to appeal against the impugned order. - Once it is apparent that merely on the ground of refusal of the permission by the Committee on Disputes the appeal could not have been dismissed and yet the appeal was dismissed solely on the said ground as rightly pointed out on behalf of the department such an order deserves to be recalled. In fact similar such orders have been recalled in some other matters also - appellant is entitled to his appeal being heard in accordance with law - Appeal restored.

Summary

Issues: Restoration of appeals rejected by Tribunal due to lack of clearance from Committee on Disputes (COD) created by Supreme Court orders in ONGC cases.

Analysis:
1. Creation and Functioning of COD: The COD was established by the Cabinet Secretary following the Supreme Court's directive in the ONGC cases to monitor disputes between government entities and ensure conciliation before litigation. The purpose was to prevent unnecessary litigation and delays in resolving disputes.

2. Recall of COD Orders: The Supreme Court, in the ECIL case, noted the inefficiency of the COD in resolving disputes and recalled its previous orders related to the COD. This decision was based on the observation that the COD mechanism led to delays in litigation, contradictory decisions, and challenges in obtaining clearances for appeals.

3. Effect on Appeal Rights: Following the recall of the COD orders, the appellants sought restoration of their appeals, arguing that the revival of their right to appeal under Section 35B of the Central Excise Act was warranted. The appellants contended that the recall of COD-related judgments reinstated their appeal rights against orders of the Commissioner (Appeals).

4. Decision on Restoration: The Tribunal allowed the restoration of the appeals, emphasizing that the recall of COD orders by the Supreme Court nullified any restrictions imposed by the COD on filing appeals. The Tribunal cited a similar case where appeals were reinstated despite COD's refusal of permission, highlighting the importance of allowing appeals to be heard in accordance with the law.

5. Waiver of Pre-Deposit: Additionally, the appellant requested a waiver of the pre-deposit condition for interest and penalty. Since the entire duty amount had been paid after COD's denial of permission to appeal, the Tribunal decided to dispense with the pre-deposit requirement for interest and penalty, staying their recovery until the appeal's disposal.

6. Conclusion: The Tribunal granted the restoration of appeals and waived the pre-deposit condition, allowing the appeals to proceed for hearing without the immediate payment of interest and penalty. The decision was based on the recall of the COD-related judgments and the need to ensure justice and adherence to legal procedures.