2015 (12) TMI 852 - AT - Customs

Release of bank guarantee - Unconditional stay already granted - Held that - The fact of submission made by the advocate as regards the bank guarantee, already stands considered by us while passing the Misc. order and it stands observed that unconditional stay was granted on its merits and not on the basis of bank guarantee. There was no direction to the appellant, while passing the stay order on 12-10-2010 for keeping the bank guarantee alive. As such, raising the same issue again, does not advance the Revenues case. - Further the fact of executing the bank guarantee during the course of investigation with an undertaking to keep the same alive till the final disposal by the Apex Court also does not support the Revenues case, inasmuch as it is the stay order of the Tribunal which would prevail and not an undertaking given by the assessee. - Appeal disposed of.

Issues:
1. Release of bank guarantee without reference to conditions.
2. Refund of margin money for cancellation of bank guarantees.
3. Rectification of mistake in the interim order regarding bank guarantee.
4. Consideration of bank guarantee in granting stay order.
5. Validity of bank guarantee in relation to stay order.
6. Pre-deposit condition and bank guarantee.
7. Compliance with tribunal's order to release bank guarantee.

Analysis:
1. The Tribunal, in an interim order, noted that an unconditional stay was granted to the appellant without reference to the bank guarantee. The appellant requested the release of the bank guarantee, which was accepted, and the Revenue was directed to comply.

2. The appellant contended that they had requested the refund of margin money for bank guarantee cancellation, but there was no response from the Commissioner. The bank guarantees had expired, and the Commissioner had not taken any action for refund. The appellant sought appropriate directions for the refund.

3. The Revenue filed a Misc. application for rectification of a mistake in the interim order, arguing that the bank guarantee should not be released as it was executed during the investigation and the appellant had undertaken to keep it alive. The Tribunal considered the application but found no merit in the Revenue's argument.

4. The Revenue argued that the stay order was granted after the advocate stated that Revenue's interest was protected by the bank guarantee. However, the Tribunal observed that the stay was granted on its merits, not based on the bank guarantee, and there was no direction to keep the bank guarantee alive.

5. The Tribunal reiterated that the stay order prevailed over any undertaking regarding the bank guarantee made by the appellant during the investigation. The fact that the bank guarantee was executed with an undertaking did not support the Revenue's case.

6. The Tribunal clarified that it was not deciding on the validity of bank guarantees in other matters, as the stay petition had already been decided without such directions. The Tribunal could not modify the previous order.

7. The Tribunal rejected the Revenue's Misc. application and directed the Commissioner to release the bank guarantee within a month, as previously ordered, emphasizing the need for compliance with the tribunal's directives.

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