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TMI Blog2015 (8) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... of amount under Section 35F of the Act. Once the proviso to Section 35C(2A) of the Act has been omitted, the embargo upon the Tribunal to limit the stay order for a limited period has now been removed. Consequently, the incidental power of the Tribunal to grant interim relief pending disposal of the appeals is now not confined to a limited period. - Tribunal has the power to grant stay as incidental or ancillary to the appellate jurisdiction as held by the Supreme Court in Income Tax Officer, Cannanore vs. M.K.Mohammad Kunhi. [1968 (9) TMI 5 - SUPREME Court], which was in relation to the scope and power of the Appellate Tribunal under the Income Tax Act. In our view, the same principle of law will govern the power of the Tribunal under the Central Excise Act. - no substantial question of law arises for consideration. - Decided against Revenue. - Central Excise Appeal (Defective) No. 153 of 2015 with Central Excise Appeal Defective Nos. 143-151 of 2015 and Central Excise Appeal Nos. 132-134, 136, 152-154 and 156-158 of 2015 - - - Dated:- 24-8-2015 - Hon'ble Tarun Agarwala And Hon'ble Surya Prakash Kesarwani,JJ. Connected with:-Central Excise Appeal Defective Nos: 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any particular case, the Commissioner (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal, may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue. 5. Based on the aforesaid provision, the assessee, while filing the appeals under Section 35-B of the Act prayed for dispensation of the requirement of pre-deposit of the duty levied. The Tribunal has passed interim orders. 6. Section 35-C of the Act was amended by Finance Act, 2002 and sub section (2A) was added. For facility, Section 35C (2A) as amended by the Finance Act 2002 is extracted hereunder: (2A) The Appellate Tribunal shall, where it is possible to do so, hear and decide every appeal within a period of three years from the date on which such appeal is filed: Provided that where an order of stay is made in any proceedings relating to an appeal filed under sub-section (1) of section 35B, the Appellate Tribunal shall dispose of the appeal within a period of one hundre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court under Article 226 of the Constitution of India could extend the stay order. 12. In L.G. Electronics India Private Ltd. vs. Commissioner of Income Tax, in Writ Tax No.390 of 2015, decided on 22.4.2015, the Writ Court held that Section 35C (2A) of the Act does not prohibit the appellant in filing a second stay application where the appeal was not disposed of within 365 days and that the interim order would stand vacated upon the expiry of 365 days. The Court further held, that where a fresh stay application was filed, the Tribunal was competent to dispose of such application. 13. In Central Excise Appeal No.117 of 2015, Commissioner of Central Excise vs. M/s Mayank and Company, decided on 2.7.2015, a Division Bench of this Court held that the interim order passed by the Tribunal under Section 35 C (2A) of the Act had a limited shelf life and that upon the expiry or immediately before the expiry, it would be open to the assessee to move a fresh stay application, which would be decided by the Tribunal in accordance with law. 14. In Commissioner of Customs and Central Excise, Kanpur vs. J.P. Transformers, 2014 (307) E.L.T. 436 (Alld.) another Division Bench of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispensed with. Now if an appeal is preferred, the assessee is required to deposit 7.5% of the duty levied before the appeal could be entertained. 17. Section 35C (2A) was amended by the provision of Section 103 of the Finance Act (2) of 2014 as under: 103. In the Central Excise Act, in Section 35C, in sub-section (2A) the first, second and third proviso shall be omitted. 18. Section 35C (2A) of the Act as amended in 2002 and 2013 makes it apparently clear that the Tribunal was mandated to hear every appeal within a period of three years where it is possible to do so . These words indicate that though a mandate was given to the Tribunal to decide the appeal within three years, it was not a mandatory provision, but, only a directory provision. Consequently, the first, second and third proviso directing the Tribunal to decide the appeal within 180 days in the first instance or within 365 days in the second instance, failing which, the stay order would stand vacated also has to be read as directory in nature. If the main provision cannot be treated as mandatory, the first, second and third proviso also cannot be treated as mandatory. 19. We are, therefore, of the opin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the appeal is not decided, the appellant would be put to irreparable loss and harm especially where the fault in not disposing off the appeal was not attributable to him. We are, therefore, of the view that strict interpretation of the three provisos to section 35C (2A) of the Act would defeat justice and would lead to a miscarriage of justice. 23. In any case, the three provisos in sub section (2A) of Section 35C of the Act has now been omitted w.e.f. 6.8.2014 and the bar which was upon the Tribunal to grant limited stay orders has now been removed even though the mandate to decide the appeal within three years, as far as possible, still continues to operate. 24. The omission of the first, second and third proviso to Section 35C(2A) of the Act in effect means that there is no provision for making any further application for extension of stay. The omission of the first, second and third proviso would mean that the appeal filed by an assessee needs to be disposed of within a period of three years and stay orders which have been passed by the Tribunal would continue to remain in force unless it is limited by the Tribunal itself. 25. The contention that the appeals filed b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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