1987 (8) TMI 269 - AT - Customs

Summary

Issues Involved:
1. Stay of the operation of the order rejecting the renewal of the Gold Dealers' Licence.
2. Legality and propriety of the Deputy Collector's order.
3. Applicability of ancillary and incidental powers of the Tribunal.
4. Consideration of administrative instructions and previous judgments.

Issue-wise Detailed Analysis:

1. Stay of the Operation of the Order Rejecting the Renewal of the Gold Dealers' Licence:
Shri Modi applied for a stay against the order of the Collector of Customs (Appeals), Bombay, which rejected his appeal against the Deputy Collector's decision to not renew his Gold Dealers' Licence. The Deputy Collector had previously confiscated foreign-marked gold and imposed penalties on Shri Modi. Despite these penalties, Shri Modi's licence had been renewed up to December 1986. The Tribunal noted that staying the order would effectively dispose of the appeal, which was beyond the scope of the stay application.

2. Legality and Propriety of the Deputy Collector's Order:
Shri Gujaral argued that the Deputy Collector's order was not a "speaking order" and thus was improper. He contended that the Deputy Collector should not have rejected the licence renewal while Shri Modi's appeal against the confiscation and penalties was still pending. The Tribunal found that the Deputy Collector's actions were based on cogent reasons and were legally sound. However, there was a dissenting opinion that the Deputy Collector had no new grounds to issue another show cause notice for the 1987-89 licence period when the final outcome of the offence case was still pending.

3. Applicability of Ancillary and Incidental Powers of the Tribunal:
Shri Gujaral cited the Supreme Court decision in Income-tax officer v. Mohd. Kumbhi, arguing that the Tribunal had the ancillary and incidental power to stay the Deputy Collector's order. The Tribunal acknowledged this power but noted that granting the stay would essentially resolve the appeal, which was not permissible at this stage.

4. Consideration of Administrative Instructions and Previous Judgments:
Shri Gujaral referenced administrative instructions from the Government of India and previous judgments, including the Allahabad High Court's decision in Premnath Khanna, to support his case. The Tribunal found these references inapplicable at this stage. However, the dissenting member, K. Gopal Hegde, emphasized that the refusal to renew the licence based on past penalties was inconsistent, given that the licence had been renewed previously despite the same penalties. He also noted that in similar cases, the same Collector (Appeals) had allowed the renewal of licences pending the final outcome of appeals.

Separate Judgments by Judges:
- K.S. Dilipsinhji (Member (T)): Rejected the stay application, emphasizing that granting the stay would dispose of the appeal, which was beyond the scope of the application.
- K. Gopal Hegde (Member (J)): Disagreed with the rejection, arguing that the refusal to renew the licence was inconsistent and would cause irreparable harm to the applicant. He supported granting the stay.
- K.L. Rekhi (Member (T)): Agreed with K. Gopal Hegde, noting that not granting the stay would render the appeal infructuous and cause irreparable injury to the applicant.

Final Order:
The majority opinion favored granting the stay application. The operation of the Deputy Collector's order, as confirmed by the Collector (Appeals), was stayed pending the disposal of the appeal G/158/87-Bom. The matter was directed to be placed before the West Regional Bench for recording the final order.