2013 (8) TMI 611 - HC - Central Excise

Recovery of duty - circular dated 1.1.2013 - Revisional Power Interim Relief - Held that - Circular was incomplete in the sense that unless there was complete mechanism for hearing the stay petitions before period of 30 days, how the Circular can be given effect to which will tantamount to denial of the legal right to the assesses for, obtaining stay because of the fault in the machinery and mechanism for consideration of the appeals and the stay petitions resulting into attachment of bank accounts etc. of running business concerns, affecting it to the extent of financial crisis. The order will be effective till the petitioners applications for interim relief - court directed the Ministry of Finance, Department of Revenue, New Delhi to clear its stand with respect to improvement of system of hearing of the appeals/stay petitions by the appellate authority or the Tribunal within a reasonable time, in the light of the Circular dated 1-1-2013 for consideration of the prayer for interim relief before 30 days from the filing of the appeal. The mechanism for deciding the cases of the Revenue require priority in the interest of the nation and since we are coming across several matters where the prayer is only for interim relief in the writ jurisdiction, when the original appeal is pending before the appellate authority or before the Tribunal, and virtually making the High Courts the courts of hearing the application for interim relief when the main matter will be decided by the appellate authority or the Tribunal, the High Courts in the entire India appear to have heavily been burdened because of the lack of infrastructure in appellate or Tribunal level.

Summary

Issues:
- Petitioners aggrieved against communication for recovery proceedings
- Concerns regarding delay in hearing appeals and stay petitions
- Lack of constituted benches leading to stay of recovery proceedings
- Ineffectiveness of revisional authorities in fixing hearing dates
- Need for improvement in the system for hearing appeals and stay petitions
- Non-functional authority due to vacancy affecting grant of interim orders
- Restraining respondents from recovering amounts under appeal
- Effective period of the court order until applications for interim relief are decided

Analysis:
The judgment addresses the grievances of petitioners against a communication issued by the Ministry of Finance regarding the initiation of recovery proceedings for confirmed demands. The petitioners argue that due to vacancies, their appeals and stay petitions cannot be considered by the Tribunal or appellate authority. The court notes the large number of pending cases and emphasizes the need for a proper mechanism to hear appeals and stay petitions promptly. It cites instances where recovery proceedings were stayed due to the non-constitution of benches. The court also criticizes the inaction of revisional authorities in fixing hearing dates, highlighting the importance of managing cases efficiently. It stresses that the system should not solely rely on the litigant's efforts and that authorities must act independently to decide cases. The judgment questions the completeness of a circular dated 1-1-2013 and calls for an improved system for hearing appeals and stay petitions within a reasonable time frame.

The court issues a notice to the Union of India and directs the Ministry of Finance to clarify its stand on improving the system for hearing appeals and stay petitions. It emphasizes the need for a priority in deciding revenue cases for the nation's interest. The court restrains respondents from recovering amounts under appeal due to non-functional authorities and vacancies. It clarifies that the order will remain effective until the petitioners' applications for interim relief are decided by the appellate authority or Tribunal. The court highlights the burden on High Courts due to infrastructure deficiencies at the appellate or Tribunal level and calls for steps to address these issues promptly.