2002 (9) TMI 570 - AT - Central Excise

Appeal Dismissed: Interest Payment Petition Denied Under Section 35F

The Appellate Tribunal CEGAT, Mumbai dismissed the appeal of the petitioners regarding payment of interest on duty. The petition for stay against the ... Stay of recovery of interest under Section 11AA - pre-deposit regime under Section 35F - non-obstante mandate for payment notwithstanding reference under Section 35N - inherent powers of the Tribunal to stay recoveryStay of recovery of interest under Section 11AA - pre-deposit regime under Section 35F - non-obstante mandate for payment notwithstanding reference under Section 35N - inherent powers of the Tribunal to stay recovery - Whether recovery of interest payable under Section 11AA could be stayed by invocation of Section 35F or the Tribunal's inherent powers where the CEGAT appeal has been dismissed and references to the High Court are pending - HELD THAT: - The Court observed that the petitioners' appeal before the Tribunal had been dismissed and that the petitioners sought a stay of recovery of interest claimed under Section 11AA by invoking Section 35F and the Tribunal's inherent powers. The Court held that the pre-deposit provisions in Section 35F apply only to deposit of duty demanded or penalty pending finalisation of appeals before the CEGAT and do not cover pre-deposit of interest. The Court further relied upon the specific non-obstante provision in Section 35N which mandates that sums due to the Government as a result of an order under Section 35C shall be payable notwithstanding that a reference or appeal is pending before the High Court or Supreme Court. Given that the appeal before the CEGAT was dismissed and Section 35N expressly requires payment notwithstanding any reference, there was no legal basis to stay recovery of the interest amount. [Paras 3, 4]Petition dismissed; no stay of recovery of the interest payable under Section 11AA could be granted.Final Conclusion: The petition for stay of recovery of interest was dismissed: Section 35F does not cover pre-deposit of interest and Section 35N mandates payment notwithstanding pending references or appeals, hence recovery could not be stayed. The Appellate Tribunal CEGAT, Mumbai dismissed the appeal of the petitioners regarding payment of interest on duty. The petition for stay against the Assistant Commissioner's direction to pay interest was rejected as Section 35F does not apply once the appeal is dismissed. The petition was dismissed based on specific provisions mandating payment to the government despite any pending references.