2015 (9) TMI 1078 - AT - Central Excise

Restoration of appeal - Non compliance of pre deposit order - Held that - after the dismissal of the appeals by order dated 06.06.2007, the right would accrue upon the Department to recover the sums due to the Government. In the present case, the Revenue enforced the recovery of dues by attachment of the property in terms of powers conferred upon them under Section 142 of the Customs Act, 1962. In effect, the Revenue had executed recovery proceeding after dismissal of appeal before the Tribunal. In such a situation, the Tribunal has no powers to recall the order and restore the appeals for hearing as the order of the Tribunal has already been acted upon. - applicants have not deposited the amount in terms of the stay order. In other words, the Revenue has recovered the amount by initiating the recovery proceedings under the law. Thus, the submission of the learned Senior Advocate that the instant applications were filed in respect of change of situation would be against the applicants. - Restoration denied.

Summary

Issues:
- Restoration of appeals dismissed for non-compliance of stay order
- Compliance with the stay order requirements
- Power of the Tribunal to restore appeals after enforcement of recovery proceedings
- Merger of Tribunal's order with High Court's judgment
- Financial crisis as a reason for delay in compliance

Analysis:

Issue 1: Restoration of appeals dismissed for non-compliance of stay order
The applicants filed applications for restoration of appeals dismissed for non-compliance of the stay order directing a pre-deposit of a specified amount. The applicants argued that they had paid the entire pre-deposit amount as directed in the stay order due to a change in circumstances, including the auction of their attached property. The applicants emphasized that the delay in compliance was due to financial crisis and departmental actions. However, the Revenue opposed the applications, highlighting the long delay and initiation of recovery proceedings. The Tribunal noted the history of dismissal and restoration attempts, ultimately concluding that the appeals could not be restored as the Revenue had already enforced recovery proceedings post-dismissal.

Issue 2: Compliance with the stay order requirements
The Tribunal observed that the applicants had not complied with the stay order requirements by depositing the specified amounts. Despite the applicants' arguments about financial difficulties and property attachment, the Tribunal found that the Revenue had initiated recovery proceedings, indicating non-compliance with the stay order. The Tribunal emphasized that the applicants' actions post-dismissal did not align with the requirements of the stay order, leading to the dismissal of the restoration applications.

Issue 3: Power of the Tribunal to restore appeals after enforcement of recovery proceedings
The Tribunal deliberated on its authority to restore appeals after the enforcement of recovery proceedings by the Revenue. It concluded that once the Revenue had taken steps to recover the dues through attachment of property, the Tribunal lacked the power to recall its order and restore the appeals for hearing. The Tribunal highlighted that the Revenue's actions post-dismissal had effectively executed the recovery process, precluding the restoration of the appeals.

Issue 4: Merger of Tribunal's order with High Court's judgment
The Tribunal noted that the applicants had previously challenged the Tribunal's orders before the High Court, which resulted in dismissals. The Tribunal highlighted that the High Court had observed gross negligence and inaction on the part of the applicants in complying with the stay order. The Tribunal reiterated the High Court's findings, emphasizing the applicants' lack of diligence and the abuse of legal processes to delay compliance.

Issue 5: Financial crisis as a reason for delay in compliance
While the applicants cited financial crisis as a reason for the delay in compliance with the stay order, the Tribunal found their explanations insufficient. The Tribunal noted that the applicants' conduct, as per the High Court's observations, indicated a lack of bona fide intentions and an abuse of legal processes to avoid obligations. Despite the applicants' arguments, the Tribunal dismissed their applications, citing lack of merit and non-compliance with the stay order requirements.

In conclusion, the Tribunal dismissed the applications for restoration of appeals, emphasizing the enforcement of recovery proceedings by the Revenue post-dismissal, lack of compliance with the stay order, and the applicants' history of negligence and abuse of legal processes.