2015 (11) TMI 1113 - AT - Service Tax

Extension of stay order - Power of Tribunal to extend stay beyond the period of 365 days - Held that - power to grant stay although not expressly provided in the Statute (either before 06.08.2014 or with effect therefrom) it was and continues to be an inherent power of the Tribunal - section did not grant any power to grant stay; it only sought to put fetters on the power of the Tribunal to grant stay beyond a certain period. Consequently its abolition can only have an effect that fetters which the said sub-section sought to place on the Tribunal with regard to the duration beyond which CESTAT could not grant stay no longer exist. In other words, with the abolition of Section 35C(2A) ibid with effect from 06.08.2014, the power of the Tribunal with regard to grant of stay in no way got attenuated. Even during the existence of sub-section 35C(2A) of the Act (i.e. prior to 06.08.2014), the Tribunal in the case of Halidram India Pvt. Ltd. Vs. CCE, Delhi 2014 (10) TMI 724 - CESTAT NEW DELHI (LB) held that the Tribunal had power to extend the stay beyond the period of 365 days in cases where appellant was ready and willing to pursue the appeal, but the Tribunal owing to the older pendency was unable to take up the appeal - Stay extended.

Summary

Issues:
Extension of stay granted by the Tribunal under Section 35C(2A) of the Central Excise Act, 1944.

Analysis:
The appellant filed a Miscellaneous Application seeking an extension of the stay granted by the Tribunal earlier due to the Revenue's insistence on recovery despite the Stay Order. The Departmental Representative argued that Section 35C(2A) of the Central Excise Act, 1944 had been abolished, thus eliminating the Tribunal's power to grant an extension of stay. However, the Tribunal noted that the power to grant stay is inherent and has been recognized by the Hon'ble Supreme Court. The Tribunal cited previous judgments to support the inherent power of the Tribunal to grant stay, emphasizing that even with the abolition of Section 35C(2A), the Tribunal's power to grant stay remains intact.

The Tribunal highlighted that the abolition of Section 35C(2A) did not affect the Tribunal's power to grant stay but removed restrictions on the duration for which stay could be granted. Even before the abolition of the section, the Tribunal had the authority to extend stay beyond the specified period if necessary. Citing a previous case, the Tribunal emphasized that delays in appeals were not the appellants' fault, and as such, the stay granted earlier should be extended to operate during the pendency of the appeals. The Tribunal rejected the Departmental Representative's contention and upheld the extension of stay granted earlier, ensuring fairness and justice in the proceedings.