2013 (10) TMI 1248 - HC - Central Excise

Court allows restoration of appeal after Tribunal's error

The court concluded that the Tribunal erred in dismissing the petitioner's application for restoration of the appeal. Given that the Revenue was granted ... Restoration of Appeal - Opportunity of Being Heard - Whether in the light of the decision of Electronics Corporation of India Limited v. Union of India & Ors. [2011 (2) TMI 3 - Supreme Court] the appeals, which have been dismissed by the appellate authority for want of clearance from the Committee on Disputes constituted in the light of the orders passed in ONGC-II Versus COLLECTOR OF CENTRAL EXCISE [1991 (10) TMI 58 - SUPREME COURT OF INDIA] are required to be restored – Held that:- Permission to prefer appeal has been granted to the Revenue by the Committee of Disputes and same has been denied to the writ petitioner and therefore, the matter was pending before the Tribunal relating to the same issue arising out of the original order but as has been raised by the Revenue only. Denial of opportunity to pursue the appeal to the writ petitioner cannot be justified in the light of the reasons given by the Hon’ble Supreme Court, for which even Hon’ble Supreme Court had to recall its own earlier orders of even constitution of Committee of Disputes - the petitioner’s contention is that in one of the appellate orders, the same issue has been decided in favour of the petitioner and against the Revenue - thus the issue certainly requires consideration by the Tribunal - the Tribunal committed error of law by dismissing petitioner’s application for restoration of appeal, which was dismissed on 10-9-2008 – Decided in favour of Petitioner. Issues Involved:1. Whether appeals dismissed by the appellate authority for want of clearance from the Committee on Disputes (CoD) should be restored even if they were dismissed prior to the judgment in Electronics Corporation of India Limited v. Union of India & Ors.2. The legality and implications of the CoD mechanism and its subsequent recall by the Supreme Court.Issue-wise Detailed Analysis:1. Restoration of Appeals Dismissed for Want of CoD Clearance:The primary issue addressed in this judgment is whether appeals dismissed for lack of CoD clearance should be restored following the Supreme Court's decision in Electronics Corporation of India Limited v. Union of India & Ors. The court considered the background and purpose of the CoD, which was established to prevent litigation between public sector undertakings (PSUs) and the Central Government. The CoD was meant to ensure that disputes were resolved amicably without resorting to litigation, as directed in various Supreme Court orders (ONGC-II, ONGC-III, and ONGC-IV).The petitioner's appeal was dismissed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) due to the lack of CoD clearance. The petitioner argued that the Supreme Court's recall of its earlier orders establishing the CoD mechanism should allow for the restoration of their appeal. The Supreme Court, in the Electronics Corporation of India Limited case, noted that the CoD mechanism had not achieved its intended purpose and had instead caused delays and inconsistencies in litigation outcomes.2. Legality and Implications of the CoD Mechanism:The court examined the Supreme Court's rationale for establishing the CoD and its eventual decision to recall the CoD-related orders. The CoD was initially set up to prevent inter se litigations between government entities, but it was found to be ineffective and led to delays. The Supreme Court observed that the CoD mechanism had outlived its utility and resulted in discrimination, as similar cases received different clearances.The court noted that the Supreme Court's decision to recall the CoD orders was prospective in nature. Therefore, appeals dismissed for lack of CoD clearance or due to CoD's refusal to grant permission could not be automatically restored. However, the court emphasized that in cases where an appeal was dismissed for want of CoD clearance and the same issue was being litigated by the opposing party (in this case, the Revenue), it would be unjust to deny the petitioner the opportunity to pursue their appeal.Conclusion:The court concluded that the Tribunal erred in dismissing the petitioner's application for restoration of the appeal. Given that the Revenue was granted permission to appeal on the same issue, the petitioner should also be allowed to pursue their appeal. The court allowed the petition, set aside the Tribunal's order dated 26th September 2012, and restored the petitioner's appeal and stay petition to their original numbers before the CESTAT, East Zonal Bench, Kolkata.