POWER OF PRESIDENT OF ‘CESTAT’

[Mr. M. GOVINDARAJAN]

Rule 3 provides that subject to such general or special orders as may be made by the President, a Bench shall hold its sittings either at Headquarters or at such other place falling within its jurisdiction as it may consider expedient.

Rule 4 provides that A Bench shall hear and determine such appeals and applications made under the Acts as the President may by general or special order direct. Where two or more Benches are functioning at any place, the President, or in his absence the senior amongst the Vice-Presidents present, or in their absence the senior most Member present, may transfer an appeal or application from one Bench to another.

Explanation (2) to Rule 6(2) provides that the President may define the ‘concerned officer’ in relation to a Bench viz., the Registrar, Deputy Registrar or any other officer authorized to receive appeals falling within the jurisdiction of that Bench.

Rule 11(4) provides that the President may in his discretion authorize any officer of the Tribunal to return any memo of appeal, application or document(s) which is/are not in accordance with the Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982. The Officer so authorized may, however, allow the documents to be refiled after removal of the defects in the specified time.

Rule 16(5) provides that the President may in his discretion direct by a general or special order that only such documents as may be specified by him in his order may be initially filed with the appeal; and the paper book as prescribed in sub-rules (1) and (2) may be filed subsequently on receipt of notice of hearing of the appeal by way of a general or specific notice for the case (s) or advance cause list. The President may further direct that in case of non-filing of the documents as specified under this Rule, the Registrar/Deputy Registrar or any other authorized officer would be competent to return the specified documents or sets of documents and to receive the same back only after rectification of the defects to the satisfaction of the proper officer or the Bench as the case may be and on the return the case may be assigned a new number.

Rule 16(6) provides that the President may by a general or special order allow attestation of the documents filed along with appeal/application or as a part of paper book or otherwise by a gazetted officer or such other person as may be authorized by the President to attest or certify such documents or photo copies thereof.

Rule 28A deals with the procedure for filing and disposal of stay petition.   Rule 28A(7) provides that subject to any general or special orders of the President in this be half, an application for stay shall be decided by the Bench having jurisdiction to hear the appeal to which the application relates.

Rule 31 provides that the President is empowered to give directions that the same Bench which heard the appeal giving rise to the application for reference to the High Court or Supreme Court shall hear such application.

Rule 31A provides that the President is empowered to give directions that an application for rectification of a mistake apparent from the record, under sub-section (2) of section 129 B of the Customs Act, or sub-section (2) of section 35C of the Central Excise Act, 1944, shall be heard by a Bench consisting of the Members who heard the appeal giving rise to the application.

Rule 44(1) provides that the Registrar shall have the custody of the records of the Tribunal and shall exercise such other functions as are assigned to him under these rules or by the President by separate order. Rule 44(2) provides that the Registrar may, with the approval of the President, delegate to the Deputy Registrar or an Assistant Registrar any function required by these rules to be exercised by the Registrar.

Rule 47 provides that the President may prescribe the dress for members.

The above said rules clearly indicate that the President of CESTAT is having power to regulate the functions of the Tribunals at all levels. In this article a case law is discussed which discusses the power of President.

In ‘C.P. Aquaculture (India) Private Limited V. President, CESTAT’ – 2010 (11) TMI 166 - MADRAS HIGH COURT the petitioner filed an appeal before the Tribunal against the order of Commissioner, Customs, Chennai. On the hearing date both the parties argued and the Tribunal on 4.06.2009 pronounced in open court the gist of decision in writing as ‘Appeal Allowed’ and both the members have signed the same on the same day and postponed the pronouncement of the detailed order by the Member (Technical) with endorsement made both by the Vice President and Member to the effect that is for the Member to pass order. On 22.6.2009 a note was passed by the Member (Technical) to Vice President for re-hearing of the appeal on certain grounds and the same was endorsed by the Vice President and on the basis of the note appeal was posted for rehearing on 30.6.2009.   The petitioner for this filed a writ petition before the High Court praying to direct the Tribunal to pass detailed order in line with the gist of final decision pronounced in the open court on 04.06.2009 without hearing the appeal.

In the petitioner, the petitioner contended that-

• Once the operative portion is finally pronounced in the open court after hearing both sides and the order sheet is signed by the members the appeal reached the finality;
• The same cannot be reopened for rehearing and there is no provision in CESTAT Rules;
• Once the final order is passed the Tribunal renders itself functus officio in relation to such matter and it cannot suo motu modify or alter the decision which is already pronounced in the open court;

Pending the said writ petition, the President passed an order on 17.7.2009 thereby laying down certain guidelines in the matter of delivery of pronouncement of the order of the Tribunal and the order contained 10 directions out of which 4 and 5 are the subject matter of challenge in the writ petition filed by the petitioner.   Another order was passed on 21.7.2009 as per which the order dated 17.7.2009 is directed to be made applicable to all pending matters as on 17.7.2009.   Against this also the petitioner filed a writ petition.

The petitioner further contended that directions No. 4 and 5 of order dated 17.7.2009 to the effect that no final order is passed even after expiry of 3 months without the order being delivered and pronounced from the date of conclusion of the hearing of the arguments, the same shall apply mutatis and mutandis to the cases where the gist of decision is pronounced and the same shall be deemed to have been ‘not heard’ and will be listed for fresh hearing only after obtaining prior order in writing from the President of Tribunal, are contrary to relevant provision of law and are without any jurisdiction.

The respondents contended that the President is empowered the regulate the functioning of the benches in all the matters in discharge of function and the circular is issued only in exercise of power vested upon the President and the direction was so issued only in pursuance of the in-direction issued in the decision made by the Supreme Court in ‘Anil Rai V. State of Bihar’ – 2001 (8) TMI 1330 - SUPREME COURT -

• The Tribunal is having inherent power to call its own order when there is error apparent on the face of the record to meet the ends of justice, in exercise of the statutory power vested upon the same for rectification of mistakes and passing the matter for rehearing is only in exercise of such inherent powers and the same cannot be validly questioned by any of the parties to the proceedings.

The High Court considered the following points to decide:

• Whether the President is empowered to issue any order regulating the manner of function of the benches in discharge of the functions if so whether such guidelines given effect to prospectively and not retrospectively?
• Whether the circular so issued by the President which is impugned herein is applied to the appeal proceedings in re-opening the same for rehearing after the gist of the decision is pronounced, signed, written and dated in the open court?

The High Court held that the Tribunal has inherent powers of review such power is recognized by the Supreme Court in respect of procedural error crept in under misapprehension and does not extend it to the extent of re-opening and re-hearing on merit that too suo motu.   The power of review cannot be exercised on the ground that the decision was erroneous on merits.

The High Court further held that the President is empowered to pass directions regarding the manner of discharge of functions by the benches and the order dated 17.7.2009 is issued only prospective and the re-opening of the appeal for re-hearing is without reference to the order dated 17.7.2009 and the bench having passed gist of decision become functus officio and has no suo motu power to recall its own order and to re-open the matter for rehearing on merits and the bench is bound to record the detailed order in line with the gist of decisions pronounced, written and signed in the open court.

The High Court directed to pass detailed order in consonance with gist of decision pronounced, recorded, signed and dated in open court on 4.6.2009 within 15 days from the date of receipt of the copy of the order of the High Court.