2014 (1) TMI 1645 - AT - Central Excise

Tribunal Upholds Stay Order, Rejects Modification Requests: Emphasizes Judicial Consistency and Lack of Review Power

BARIJORIWALA ROLLING MILLS PVT. LTD. Versus COMMR. OF C. EX., JAIPUR-I

BARIJORIWALA ROLLING MILLS PVT. LTD. Versus COMMR. OF C. EX., JAIPUR-I - 2014 (313) E.L.T. 51 (Tri. - Del.) Issues Involved:1. Modification of Stay Order.2. Clandestine manufacture and clearance of goods.3. Basis of duty demand on electricity consumption.4. Power of Tribunal to review its own orders.5. Inconsistent stand by the Commissioner in similar cases.Issue-wise Detailed Analysis:1. Modification of Stay Order:The applicants sought modification of the Stay Order Nos. 1780-1781/2012-EX, dated 23-10-2012, which directed M/s. Barijoriwala Rolling Mills Pvt. Ltd. to deposit 25% of the duty demand and Shri Lakhan Goyal, director, to deposit Rs. 2 lakh towards penalty as a condition for hearing their appeal. The modification was requested on the grounds that the Commissioner of Central Excise, Jaipur, had subsequently dropped the show cause notices issued to other assessees based on the same cause of action and evidence.2. Clandestine Manufacture and Clearance of Goods:The Revenue conducted a search on the premises of M/s. Nirmal Inductomelt Pvt. Ltd. and recovered incriminating documents indicating that M.S. ingots were cleared to various units, including the appellant, without proper accounting. The entries of ingots in the appellant's records were less than the quantity shown to have been supplied, leading to the conclusion that the appellant was involved in the clandestine manufacture and clearance of final products, resulting in a confirmed duty of Rs. 1,26,067.3. Basis of Duty Demand on Electricity Consumption:A significant portion of the duty demand, amounting to Rs. 2,79,34,347, was based on the consumption of electricity. The Revenue's investigation in the factory of M/s. Shree Sharma Steel Re-rolling Mills Pvt. Ltd. found that the average power consumption for manufacturing similar products was 102.09 units of electricity per MT. Applying this ratio to the appellant, the Revenue concluded that the appellant had underreported production, leading to the confirmation of the demand.4. Power of Tribunal to Review its Own Orders:The Tribunal discussed whether it had the power to modify its own stay order based on subsequent developments. The Judicial Member argued for modification, citing the Commissioner's subsequent orders dropping demands in similar cases. However, the Technical Member opposed, stating that the Tribunal becomes functus officio after passing an order and cannot review it without specific statutory power. The Tribunal ultimately rejected the modification application, emphasizing the lack of inherent power to review its orders.5. Inconsistent Stand by the Commissioner in Similar Cases:The appellants argued that the Commissioner had dropped duty demands in similar cases involving M/s. Natani Rolling Mills Pvt. Ltd. and M/s. Shiv Prasad Rolling Mills Pvt. Ltd., which were based on the same set of facts and evidence. However, the Tribunal noted that the facts of the present case might not be identical to those cases, and the Commissioner's orders in those cases were under appeal and not final. Therefore, the Tribunal concluded that the Commissioner's inconsistent stand could not justify modifying the stay order.Conclusion:The Tribunal, by majority, rejected the miscellaneous applications for modification of the stay order, emphasizing the lack of power to review its own orders and the need for consistency in judicial decisions. The Tribunal found that the evidence and circumstances in the present case warranted the original stay order, and subsequent developments in other cases did not justify a modification.