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TMI Blog2013 (4) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... against a confirmatory order in original and (3) where an appeal has been filed with a stay application against such order. Assertive plea made on behalf of the petitioners that the office of the Commissioner (Appeals) Jaipur-I is lying vacant for which there is no possibility in near future that the appeals and interim applications would be heard and disposed of, has not been refuted. Having regard to the statutory obligations past for timely disposal of the appeals and the interim applications, its is constrained to conclude that the contemplated recovery of the demands in this factual scenario even otherwise, if approved, would be grossly unfair, unjust and unreasonable and would amount to allowing the respondents-authorities to take advantage of their own lapses and failings. The petitioners- assessees , whose appeals alongwith interim applications are pending without any decision for no fault of theirs, can by no means be left exposed to the megrim of the departmental authorities test the statutory guarantee engrafted in Chapter VIA of the Act is rendered illusory. The plea that the power of issuing earlier circulars on the same issue with some protective features vis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excisable goods. A show cause notice being C.No.V ( 25)3 /18/Demand/2011/4152 dated 13.6.2011 was issued by the departmental authorities on the basis of scrutiny of monthly ER Returns filed by the petitioner for the months from June, 2010 to December, 2010 alleging that it had availed the cenvat credit of service tax paid on different services received by it in relation to maintenance and repair works of its residential colony, which did not appear to be eligible input services as per Rule 2(1) of the Cenvat Credit Rules, 2004 (for short, hereafter referred to as "the Rules of 2004"). Penalty together with interest was proposed under the relevant provisions of the Rules of 2004. 4. The petitioner filed its reply to the show cause notice, whereafter , the learned Assistant Commissioner, Central Excise Division, Kota vide Order-in-Original No.06 ( CE-Demand) 2012 dated 14.2.2012 affirmed the demand alongwith interest and penalty. Being aggrieved, the petitioner has preferred an appeal under section 35 of The Central Excise Act, 1944 (for short, hereafter referred to as "the Act") before the Commissioner (Appeals), Jaipur-I against the resultant demand alongwith interest and penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal issued by the Commissioner Recovery to be initiated after expiry of statutory period of 90 days for filing appeal from the date of communication of order. 5. CESTAT Appeal filed without stay application against an Order in Original issued by the Commissioner Recovery to be initiated on filing of such an appeal without waiting for the statutory 90 days period to be exhausted. 6. CESTAT Appeal filed with a stay application against an Order in Original issued by the Commissioner. Recovery to be initiated 30 days after the filing of appeal, if no stay is granted or after the disposal of stay petition in accordance with the conditions of stay, if any, whichever is earlier. 7. Nil No appeal filed against an Order in Appeal issued by a Commissioner (Appeals) confirming the demand for the first time. Recovery to be initiated after expiry of statutory period of 90 days for filing appeal from the date of communication of order. 8. CESTAT Appeal filed without stay application against an Order in Appeal confirming the demand for the first time. Recovery to be initiated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eafter referred to as "the Rules") envisages instructions akin to those contained in the impugned circular, the learned counsels maintained that in any view of the matter, the action proposed is illegal, unfair and arbitrary and is only a pretentious move to represent a zealous endeavour to realize the pending demands with the impending closure of the current financial year. According to the learned counsel, as the petitioners have filed their appeals with the application for stay within time in the exercise of their statutory right under the Act and are by no means responsible for the delay in the disposal thereof, the directions for recovery as mandated by the impugned circular with time frames prescribed for different contingencies, are not only patently unfair, unjust and unreasonable, but also de-hors the ground realities contributing to the delay of appeals and stay applications for which they, in any view of the matter, are not liable. In course of the arguments, attention of this Court was also drawn to the fact that the office of the Commissioner (Appeals), Jaipur-I is lying vacant and that the new incumbent has not joined. They contended that if the impugned circular is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the eventualities narrated therein fixing periods therefore. Broadly, three situations have been contemplated (1) where no appeal has been filed against a confirmatory order in original; (2) where an appeal has been filed without stay application against a confirmatory order in original; and (3) where an appeal has been filed with a stay application against such order. In the first contingency, in terms of this circular, the process of recovery is to be initiated after the expiry of statutory period of 60 days' for filing appeal and in the second, after the institution of the appeal. In the third eventuality, the process of recovery has been mandated to be initiated 30 days after the filing of appeal, if no stay is granted or after the disposal of stay petition in accordance with the conditions, as specified. Noticeably, it is by this category of cases where appeals have been filed alognwith the stay applications, which have remained undisposed and/or unattended, that the assessees (petitioners) are really distressed and aggrieved. They contend, to reiterate, that apart from the circular being invalid for want of statutory sanction, it is palpably arbitrary, unfair and unjust as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of Section 35B , the Tribunal would have to dispose of the appeal within a period of 180 days' from the date of such order failing which the stay order on the expiry of that period would stand vacated. Section 35F prescribes for the deposit of the duty demanded or penalty levied pending appeals in the contingencies as contemplated therein. The first proviso, however, authorizes the Commissioner (Appeals) and the Tribunal to dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of the revenue, if he/it is of the opinion that such deposit of duty demanded or penalty levied would cause undue hardship to the assessee . The second proviso, however, enjoins that when an application is filed before the Commissioner (Appeals) for dispensing with the deposit of duty demanded or penalty levied, he, where it is possible to do so, decide such application within 30 days' from the date of its filing. 11. The scheme that emerges from the outline of the above provisions launched under Chapter VIA of the Act, thus, not only confers a statutory right on the assessee and concerned revenue authorities, as the case may be, to prefe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny view to the contrary would be repugnant to the statutory comprehensions and the underlying intendment of the Act providing the statutory remedies against the orders demanding duty and penalty as contemplated therein. The right of appeal being statutory in nature, the incidental provision for exemption, in deserving cases, by way of interim relief, from making the otherwise mandatory deposit of duty demanded or penalty levied, can by no means be trivialized or annihilated by any administrative ukase. Such a conferment can permissibly be circumscribed only by and to the extent ordained by the statute. The extinction of such a statutorily conferred right by any administrative fiat without the sanction of the enactment endowing the same is impermissible. The remedy by way of appeal and interim absolution from the requirement of deposit of duty demanded or penalty levied being a legislative prescript, denial thereof by the ipse dixit of an authority even statutory dehors legal ratification would be unsustainable. In absence of any enabling power therefor, express or implicit, by no means, can such an authority sans any valid empowerment vide instructions of administrative nature supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period recoveries are being effected by coercive process. Whenever an assessee files an appeal alongwith an application for exemption from condition of pre-deposit he legitimately expects that such an application shall be disposed of first and then only the recoveries are effected. It is, therefore, necessary for the respondents to devise a fair procedure so that grievance of such assessee is redressed and no amounts are recovered by coercive process before the application for exemption from the condition of pre deposit is disposed of." 17. This proposition, as quoted above, would proclaim not only the recognized legitimate expectation of petitioner- assessee that its appeal be disposed of first and then only the recovery would be effected, it emphasizes that to ensure fairness in procedure, no amount ought to be recovered before the application for exemption is disposed of. 18. Noticeably, the assertive plea made on behalf of the petitioners that the office of the Commissioner (Appeals) Jaipur-I is lying vacant for which there is no possibility in near future that the appeals and interim applications would be heard and disposed of, has not been refuted. Having regard to the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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