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2014 (3) TMI 38 - AT - Service TaxExtension of stay order - Operation of the orders expired in terms of the 2nd and 3rd pvosisos to Section 35C(2A) of the Central Excise Act, 1944 Held that - An order of waiver of pre-deposit granted under provisions of Section 35F does not, either expressly or by any compelling implication, have a legislatively enjoined sunset period. Waiver of pre-deposit granted always operates during pendency of the appeal. Pre-deposit is a threshold requirement for triggering the substantive jurisdiction of the Tribunal. Pendency of the appeals are not on account of any conduct of the appellants but on account of pendency of a large number of older appeals and a critical supply/demand mismatch in the Tribunal - it is appropriate to grant extension of the stay orders earlier granted, to operate during the pendency of the appeals Following decision of R. Ariyappan and M/s. OPG Metals Pvt. Ltd. and others Versus Commissioner of Central Excise & Service Tax, Tiruchirapalli 2013 (12) TMI 457 - CESTAT CHENNAI - Stay granted.
Issues: Application for extension of stay order under Finance Act, 2013.
Analysis: 1. The issue in consideration pertains to the extension of a stay order following the enactment of the Finance Act, 2013. The key contention raised was regarding the insertion of the third proviso in Section 35C (2A) of the Central Excise Act, 1944, and Section 129B (2A) of the Customs Act, 1962 by the Finance Act, 2013. The provision states that if an appeal is not disposed of within 365 days from the date of the initial order, the stay order stands vacated. The argument was supported by referencing previous tribunal decisions and the impact of the new provision on the tribunal's power to extend stay orders beyond 180 days. 2. Upon hearing both sides and examining the records, the Tribunal addressed the raised issue by referring to a previous decision in the case of R. Ariyappan and Others Vs CCE and ST, Tirichirapali. The Tribunal rejected the argument that the expiration of a stay order due to the specified period automatically bars the jurisdiction of the Tribunal to grant an extension. It was clarified that the Tribunal retains the authority to grant or extend a stay order as deemed appropriate, despite the expiration of the initial order. 3. The Tribunal further emphasized that the absence of a stay order does not preclude the possibility of granting an extension for a non-existent order. This clarification was supported by a detailed analysis of a previous case involving the Commissioner of Central Excise, Chennai-I Vs SRF Ltd. The Tribunal highlighted the distinction between a stay order and a waiver of pre-deposit, emphasizing that the extension of a stay order is not contingent upon the existence of a previous stay but can be granted based on the circumstances of the case and the Tribunal's discretion. 4. Ultimately, the Tribunal allowed the application for the extension of the stay order, extending the period until the appeal's disposal. The decision was based on the acknowledgment of the substantial backlog of appeals before the Tribunal, attributing the delay in the appeal's resolution to external factors rather than any fault of the applicant. The Tribunal exercised its discretion to grant the extension, considering the circumstances and the principle of fairness in the adjudication process.
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