2017 (8) TMI 898 - AT - Central Excise

Refund of pre-deposit made during the pendency of the appeal before the Tribunal - Held that - If the Revenue was aggrieved with the Tribunal s order passed in the appellant s case allowing their appeal, it was open to them to challenge the same before the higher appellate forum on the ground that the relied upon decisions of the High Courts have not been accepted by the Department and stands challenged. Once the Tribunal order attains finality, and the same has to be given effect to. There cannot be a second opinion on the above proposition and I strongly fell that the Commissioner (Appeals) has committed an error of law - appeal allowed - decided in favor of appellant.

Summary

Issues: Refund of pre-deposit during pendency of appeal before Tribunal; Reversal of original authority's refund order by Commissioner (Appeals) based on stay of High Courts' decisions by Supreme Court.

Analysis:
1. The issue in this case revolves around the refund of a pre-deposit made by the appellant during the pendency of the appeal before the Tribunal. The original adjudicating authority had granted the refund, but the Commissioner (Appeals) reversed this decision citing that the High Courts' decisions, relied upon by the Tribunal in favor of the assessee, were stayed by the Supreme Court. The Commissioner (Appeals) raised concerns regarding the correctness of the Tribunal's order based on the stayed judgments. The Deputy Commissioner had sanctioned the refund, but the Department appealed, stating that the High Courts' orders were challenged before the Apex Court and were stayed. The Tribunal's decision was questioned in light of the stayed judgments, leading to the Commissioner (Appeals) overturning the refund order.

2. The appellant's representative argued that the Tribunal's order, which formed the basis for the refund claim, was not appealed against by the Revenue and thus should be accepted. It was contended that once the Tribunal's order became final, the refund should be granted as per the decision. The Tribunal's reliance on the stayed judgments was deemed acceptable, and the appellant was considered entitled to the refund.

3. The Judicial Member agreed with the appellant's stance, emphasizing that if the Revenue disagreed with the Tribunal's order favoring the appellant, they should have challenged it in a higher appellate forum. Once the Tribunal's decision was final, it had to be implemented without further dispute. The Commissioner (Appeals) was criticized for committing a legal error in overturning the original authority's refund order.

4. Moreover, it was noted that the High Courts' orders were only stayed by the Supreme Court and not set aside. In light of this, the Commissioner (Appeals) lacked the authority to rule against the appellant. The Judicial Member found no legal basis for the Commissioner (Appeals) to reverse the refund order based on the stayed judgments.

5. Consequently, the Judicial Member set aside the Commissioner (Appeals)'s decision and allowed the appeal, granting the appellant the refund with consequential relief. The judgment highlighted the importance of respecting final decisions and the lack of grounds for the Commissioner (Appeals) to deny the refund based on the stayed High Courts' orders.