2014 (11) TMI 665 - HC - Central Excise

Denial of CENVAT Credit - tribunal disposed of the appeal while deciding the stay application - Held that - Appeal could not have been disposed of by such a short order. The matter concerns interpretation of some rule. If that interpretation accords with the view taken by this Court and sought to be cited by the Tribunal, then, that is something which has to be gone into and decided in depth. By merely referring to that judgment of this Court, the issue cannot be said to be covered. This is one more case where we have an occasion to comment and adversely on unsatisfactory disposal of the appeal by the Customs Excise and Service Tax Appellate Tribunal. The Judicial Tribunal has been set up in order to decide not only the appeals against the Order-in-Original but even against the first Appellate Authority. Such a Tribunal is expected to apply its mind Judiciously, independently and impartially. Once the appeal has been disposed of in the manner noted above and without the consent of both sides, then, we are proceed to admit this appeal. Since we have found that the Appellant-Revenue has suffered serious prejudice on account of such dismissal of the appeal by a Judicial Tribunal then interest of justice would be served if we set aside the impugned order to the extent it disposes of the appeal finally. - waiver of pre-deposit will continue - Appeal restored before tribunal - Decided in favor of revenue.

Summary

Issues:
1. Disposal of appeal by Tribunal at the stage of considering stay/waiver of pre-deposit.
2. Adjudication of appeal by Customs, Excise & Service Tax Appellate Tribunal.
3. Justification of waiving the requirement of pre-deposit.
4. Judicial Tribunal's duty to decide appeals independently and impartially.

Analysis:
1. The appeal was filed against an order by the Tribunal disposing of the appeal while considering an application for stay/waiver of pre-deposit. The Tribunal disposed of the appeal without detailed consideration of facts and allegations, solely relying on a judgment of the High Court. The High Court criticized this approach, emphasizing that the Tribunal should have thoroughly examined the interpretation of relevant rules and not merely referred to the High Court's judgment. The High Court highlighted the importance of the Tribunal acting as a final fact-finding authority and rendering decisions judiciously, independently, and impartially.

2. The High Court found that the Tribunal's disposal of the appeal without the consent of both parties was unjust and prejudicial to the Appellant-Revenue. Consequently, the High Court set aside the Tribunal's order to the extent that it disposed of the appeal finally. The High Court clarified that the appeal should be heard and finally disposed of on its merits, emphasizing that the Tribunal should not be influenced by its initial observations made during the stay application.

3. Despite acknowledging the Tribunal's justification for waiving the pre-deposit requirement due to a strong prima facie case and balance of convenience in favor of the respondent-assessee, the High Court emphasized that the Tribunal's decision should not be considered final. The High Court directed the Tribunal to dispose of the appeal on merits and in accordance with the law, maintaining independence and impartiality in its decision-making process.

4. In conclusion, the High Court restored the appeal to the Tribunal for proper disposal on merits and in accordance with the law. The High Court stressed the importance of expeditiously handling the proceedings to avoid unnecessary delays, highlighting the need for the Tribunal to fulfill its duty as a judicial authority by thoroughly examining all aspects of the case and rendering a well-reasoned decision.