2007 (5) TMI 78 - AT - Central Excise

In case CESTAT directs departmental authorities to do a particular thing within a specified parameters and is satisfied that its directions has been flouted , it can intervene u/s 41 and pass such orders as may be necessary to give effect to its direction and to secure the ends of justice

Summary

Issues:
1. Non-compliance with the directions of the Final Order dated 21-9-2004 and subsequent Order-in-Appeal dated 30-3-2005 by the Assistant Commissioner.
2. Disobedience of Tribunal's and Appellate Commissioner's directives by the Assistant Commissioner.
3. Legality and propriety of the Assistant Commissioner's order dated 22-3-2007.
4. Applicability of Rule 41 of the CESTAT (Procedure) Rules in enforcing compliance with Tribunal's directions.

Analysis:

1. The application by the assessee highlights the failure of the original authority to act upon the directions of the Tribunal's Final Order dated 21-9-2004 and the subsequent Order-in-Appeal dated 30-3-2005. Despite multiple reminders, the Deputy Commissioner (ACC) did not comply with the directives, leading to the filing of the present application. The Assistant Commissioner's Order-in-Original dated 22-3-2007 rejecting the refund claim and retaining the amount in the Consumer Welfare Fund was challenged by the assessee as being in disobedience of the Tribunal's and the Appellate Commissioner's directives.

2. The Assistant Commissioner's actions were deemed contumacious and repugnant to the course of justice by the Tribunal. Instead of following the Tribunal's directives, he initiated an inquiry into unjust enrichment, which was not permissible as per the Tribunal's order. The Assistant Commissioner's decision to reject the refund claim and retain the amount in the Consumer Welfare Fund was considered grossly reprehensible. His defiance of the Tribunal's Final Order dated 21-9-2004 and the Order-in-Appeal dated 30-3-2005 was evident, and he admitted his misfeasance during the proceedings.

3. The Tribunal found the Assistant Commissioner's order dated 22-3-2007 to be in direct contradiction to the Tribunal's and the Appellate Commissioner's directives. The Assistant Commissioner failed to carry out the directions aimed at refunding the excess amount paid by the assessee. In light of the Assistant Commissioner's defiance and admission of misfeasance, the Tribunal set aside his order under Rule 41 of the CESTAT (Procedure) Rules and directed him to implement the Tribunal's order dated 21-9-2004 within seven days, reporting compliance to the Bench.

4. The Tribunal invoked Rule 41 ibid read with Rule 40 of the CESTAT (Procedure) Rules to enforce compliance with its directives. By setting aside the Assistant Commissioner's order and directing immediate implementation of the Tribunal's order dated 21-9-2004, the Tribunal sought to ensure that justice was served and the assessee received the relief entitled to them. The appeals filed by both the Revenue and the assessee against the Appellate Commissioner's order dated 30-3-2005 were scheduled for hearing on 8-6-2007.