2014 (2) TMI 926 - AT - Customs

Tribunal extends stay order pending appeal, showcasing discretion under Finance Act.

Hindustan Construction Co. Ltd. Versus Commissioner of Customs, Tuticorin

The Tribunal allowed the application for the extension of the stay order originally granted in 2005 until the appeal is resolved. The decision was made in ... Extension of stay beyond 180 days or 365 days - operation of the orders expired in terms of the 2nd and 3rd pvosisos to Section 35C(2A) of the Central Excise Act, 1944 – Held that:- An order of waiver of pre-deposit granted under provisions of Section 35F does not, either expressly or by any compelling implication, have a legislatively enjoined sunset period. Waiver of predeposit granted always operates during pendency of the appeal. Pre-deposit is a threshold requirement for triggering the substantive jurisdiction of the Tribunal. – Decision in the case of R. Ariyappan and M/s. OPG Metals Pvt. Ltd. and others Versus Commissioner of Central Excise & Service Tax, Tiruchirapalli [2013 (12) TMI 457 - CESTAT CHENNAI] followed Pendency of the appeals are not on account of any conduct of the appellants but on account of pendency of a large number of older appeals and a critical supply/demand mismatch in the Tribunal - it is appropriate to grant extension of the stay orders earlier granted, to operate during the pendency of the appeals – Decided in favour of Assessee. Issues involved:Extension of stay order under Finance Act, 2013.Analysis:The applicant sought an extension of stay order No.993/2005, which was previously extended by MISC Order No.406962013. The issue raised was regarding the Tribunal's power to extend the stay order after the enactment of the Finance Act, 2013, which inserted the third proviso to Section 35C (2A) of the Central Excise Act, 1944. The Ld. AR argued that this insertion restricted the Tribunal's authority to extend stay orders beyond 365 days. However, the Tribunal, after considering both sides and reviewing relevant precedents, overruled this contention. In the case of R. Ariyappan and Others Vs CCE and ST, Tirichirapali, it was held that the expiration of a stay order does not bar the Tribunal from granting a stay or extension when necessary.Another argument presented was that since the earlier stay order had abated, there was no power to grant an extension of a non-existent order. This argument was supported by a previous order involving the Commissioner of Central Excise, Chennai-I Vs SRF Ltd. However, the Tribunal clarified that the absence of a stay order did not prevent the granting of an extension, especially in cases where the delay in appeal disposal was not due to the appellant's conduct. The Tribunal emphasized that the pendency of appeals was primarily due to a backlog and supply-demand issues within the Tribunal, justifying the extension of the stay order until the appeal's final disposal.In conclusion, considering the substantial backlog of appeals and the unavoidable delays in disposal, the Tribunal allowed the application for the extension of the stay order originally granted in 2005 until the appeal is resolved. The decision was made in acknowledgment of the circumstances leading to the appeal's prolonged pendency and not due to any fault of the applicant.This judgment highlights the Tribunal's authority to extend stay orders even after the insertion of the third proviso to relevant sections of the Finance Act, 2013. It underscores the Tribunal's discretion to grant extensions based on the specific circumstances of each case, especially when delays in appeal disposal are beyond the appellant's control.