1997 (1) TMI 320 - AT - Central Excise

Summary

Issues:
Stay application for waiver of pre-deposit of duty and penalty, classification of Animal Feed Supplements under Tariff Item 23.02 or other chapters, denial of principles of natural justice, competence of Tribunal to stay proceedings before Adjudicating Authority, remand for reconsideration.

Analysis:
The stay application was filed by the appellants seeking waiver of pre-deposit of duty and penalty amounting to Rs. 2,13,18,911/- and stay of recovery proceedings. The dispute revolved around the classification of 18 Animal Feed Supplements under Tariff Item 23.02 as claimed by the party or under other chapters as held by the Department. The main issue was whether the amount required to be deposited for hearing the appeal should be dispensed with, allowing the main matter to be taken up for final hearing with consent from both sides.

During the proceedings, the party argued that the Department should have waited for the Tribunal's decision on the classification issue before passing the order. The party had filed a miscellaneous application requesting to restrain the respondents from proceeding with the matter until the issue was settled by the Tribunal. The party also referred to a circular issued by the Board clarifying the classification of Animal feed supplements. The party contended that the order suffered from a denial of principles of natural justice and requested a remand for reconsideration.

The Department, however, argued that the party had been given sufficient time to state their case and failed to provide evidence to claim exemption as per the circular. The Department opposed the stay and remand, justifying the impugned order.

The Tribunal, after considering the submissions from both sides and perusing the records, found that the Commissioner should have waited for the Tribunal's decision before passing the order. The Tribunal noted that the Collector's observations were contrary to the Tribunal's view in a previous case and that the Tribunal had inherent powers to stay proceedings. The matter was remanded to the Commissioner for reconsideration, with directions to dispose of the matter expeditiously.

In a separate order, another Member of the Tribunal agreed with the decision to remand the case for reconsideration. The Member made observations on the Collector's belief that the Tribunal was not competent to stay proceedings before the Adjudicating Authority, highlighting that the Tribunal had the power to issue directions to secure the ends of justice.

In conclusion, the appeal was allowed by way of remand, with directions for the Commissioner to pass an appropriate order after providing an opportunity to the appellants. The stay application and the appeal were disposed of accordingly.