2017 (11) TMI 557 - HC - Customs

Interest on delayed refund - relevant date - principles of natural justice - Held that - It is true that while deciding the application for stay and/or for waiver, the Appellate Tribunal is not expected to write detailed Judgment. This Court has repeatedly held that prima facie consideration of merits of the case made out by the appellant is required to be made while deciding such application. It is true that the Appellate Tribunal is not expected to write elaborate Judgment for coming to the conclusion whether prima facie case exists or not. In the facts of the case, the order does not reflect the application of mind by the Appellate Tribunal as regards the existence of prima facie case or otherwise. The Appellate Tribunal has not done its duty and therefore, the application made by the appellant will have to be reconsidered by the Appellate Tribunal - appeal restored for reconsideration.

Summary

Issues:
1. Interpretation of provisions of Section 129E of the Customs Act, 1962 for granting stay of the operation of the impugned order.
2. Prima facie consideration of merits of the case by the Appellate Tribunal while deciding applications for stay and/or waiver.

Analysis:

1. The appellant revenue filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal challenging an order by the Commissioner of Customs regarding payment of interest on a refund claimed. The Commissioner held that interest would be payable by the appellant from a specific date after receiving the refund application. The Appellate Tribunal, in an impugned order, dismissed the stay application filed by the appellant, citing lack of merit and failure to consider the provisions of Section 129E of the Customs Act, 1962. The High Court noted that the Tribunal did not adequately apply its mind to the existence of a prima facie case, leading to the quashing of the order and restoration of the application for reconsideration by the Tribunal.

2. The High Court emphasized that while dealing with applications for stay or waiver, the Appellate Tribunal is not required to provide a detailed judgment but must conduct a prima facie consideration of the merits presented by the appellant. The Court reiterated that the Tribunal's decision must reflect an application of mind regarding the existence of a prima facie case. In this case, the Court found that the Tribunal failed to fulfill its duty in this regard, leading to the order for reconsideration of the application. The High Court set aside the impugned order, restored the application to the Tribunal, and directed the Tribunal to hear and decide the application afresh, emphasizing the need for necessary priority in the reconsideration process.

3. The High Court's order included specific directives for the Appellate Tribunal, ensuring that all contentions on merits remain open for consideration. The appeal was partly allowed with no order as to costs, and any pending Notice of Motion was disposed of accordingly. The judgment highlighted the importance of the Tribunal's duty to conduct a prima facie assessment of the case's merits while deciding applications for stay or waiver, underscoring the need for a thoughtful consideration of the issues raised by the appellant.