2015 (4) TMI 490 - HC - Central Excise

Waiver of pre dpeosit - Extension of stay order - Power of Tribunal to extend the stay - Held that - Waiver from pre-deposit and unconditional stay on the realisation of the adjudicated liability has been granted by the Tribunal since a prima facie case was found in favour of the assessee. The Tribunal has also observed that the appeal could not been disposed of only on account of the pendency of several older appeals and not on account of any delay on the part of the assessee. - ends of justice would be met if the Tribunal is requested to dispose of the appeal expeditiously and preferably within a period of six month - waiver of pre-deposit and stay will continue to remain valid for a period of six months - Stay granted.

Summary

Issues:
1. Interpretation of provisions of Section 35C (2A) of the Central Excise Act, 1942 regarding waiver of pre-deposit and stay orders by the Appellate Tribunal.
2. Whether the Tribunal has the power to grant waiver of pre-deposit indefinitely.

Analysis:
1. The Revenue appealed against the order of the Customs, Excise & Service Tax Appellate Tribunal, challenging the waiver of pre-deposit granted to the respondents during the appeal's pendency. The main contention was whether the Tribunal erred in granting an unlimited waiver of pre-deposit, exceeding the time limits specified in Section 35C (2A) of the Central Excise Act, 1942. The Tribunal was bound to specify a time limit for the stay order, not exceeding 180 days in the first instance and 185 days in the second instance, with a total limit of 365 days. The appeal was admitted on these questions for final hearing.

2. The High Court referred to the provisions of Section 35C (2A) of the Act, which require the Appellate Tribunal to dispose of appeals within specific timeframes, especially in cases where a stay order is issued. The Court cited a Supreme Court judgment in Commissioner of Customs and Central Excise, Ahmedabad Vs. Kumar Cotton Mills Pvt. Ltd., emphasizing that the Tribunal should not extend the period of stay unless there are valid reasons beyond the control of the assessee. Additionally, a Division Bench of the High Court in a previous case highlighted that granting indefinite waiver of pre-deposit defeats the purpose of the relevant provisions. The Court directed the Tribunal to decide the appeal expeditiously, ideally within six months, and specified that the waiver of pre-deposit would remain valid for the same period.

In conclusion, the High Court disposed of the appeal, instructing the Tribunal to expedite the appeal's resolution within six months and maintaining the validity of the waiver of pre-deposit for the same duration. The decision aimed to ensure justice by balancing the interests of the parties involved, considering the legal provisions and previous judicial interpretations.