2014 (9) TMI 531 - HC - Central Excise

Validity of Tribunal s order - Tribunal remanded matter back - finding recorded in the said order of remand revealed that the adjudicating officer founded the consideration only on the clearances to the interconnected undertakings and failed to avert to the other legal points canvassed by the petitioner before the said authority - Held that - In the impugned order the Tribunal have recorded that since the order of remand is not assailed, which has reached in its finality, the petitioner cannot raise the issue which has earlier been raised or not raised which passing a remand order. The aforesaid observation is contrary to the settled proposition of law. The remand was an open one and all the legal points which are available to the petitioner was kept open to be decided by the adjudicating officer - The order of remand cannot stand in the way of raising a legal plea that the same was either raised or not raised in an earlier round of litigation. Probably, the Tribunal was trying to take shelter under Explanation IV to Section 11 of the Civil Procedure Code which estopped the parties to agitate the plea which was available as ground of attack or defence in an earlier proceedings and having not raised, the same cannot be re-agitate - matter remanded back - Decided in favour of assessee.

Summary

Issues:
1. Application seeking waiver of pre-deposit condition.
2. Validity of the order of remand by the Tribunal.
3. Whether all legal points were kept open for the petitioner in the remand order.
4. Application of Explanation IV to Section 11 of the Civil Procedure Code.
5. Compliance with the time-bound order by the Tribunal.

Analysis:
1. The High Court considered the order dated 26th of November, 2013, passed by the CESTAT concerning an application seeking waiver of a pre-deposit condition. The Court observed that the CESTAT's decision seemed to be based on extraneous considerations not relevant to the application's disposal. The matter had been through multiple stages, starting with the adjudicating officer passing an order, leading to a remand by the Tribunal, subsequent decisions, and finally reaching the CESTAT.

2. An order dated 26th of November, 2007, saw the Tribunal remanding the matter to the adjudicating officer for a fresh order. The High Court noted that the remand was open-ended, allowing all legal points raised by the petitioner to be considered. The CESTAT set aside subsequent orders, directing the adjudicating officer to decide the matter afresh without being influenced by previous observations.

3. The Tribunal's impugned order suggested that since the remand order was final and not challenged, the petitioner could not raise issues previously raised or not raised during the remand process. The High Court disagreed with this interpretation, stating that all legal points should remain open for consideration during the fresh decision-making process.

4. The High Court addressed the application of Explanation IV to Section 11 of the Civil Procedure Code, emphasizing that parties should not be estopped from raising legal pleas that were not raised in earlier proceedings if the previous order was set aside and remanded for fresh consideration.

5. Finally, the High Court quashed and set aside the impugned order, directing the Tribunal to reconsider the application on its merits within a strict four-week timeline. The Court emphasized the mandatory nature of the timeline and urged strict adherence. The parties were to update the Court on compliance after six weeks, with a reminder that the order did not impact the merits of the proceeding, leaving the CESTAT free to take an independent view.