Extended stay beyond 365 days remains permissible when appeal delay is not attributable to the assessee.

The Gujarat HC held that the CESTAT can, in appropriate cases, extend stay beyond 365 days under Section 35C(2A) of the Central Excise Act where delay in disposing of the appeal is not attributable to the assessee and the assessee has cooperated in expeditious hearing. Applying its earlier view, the Court found no basis to interfere on the facts and left any complaint that reasons were not recorded for the extension to be raised before the Tribunal by rectification. The Tribunal therefore did not lack power to continue the stay, and the issue was answered in favour of the assessee.

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Issues: Whether the Appellate Tribunal could extend stay beyond 365 days under Section 35C(2A) of the Central Excise Act, 1944.

Analysis: The Court followed its earlier decision holding that the Tribunal has power, in appropriate cases, to continue or extend stay beyond 365 days where the delay in disposal of the appeal is not attributable to the assessee and the assessee has cooperated in early disposal. On the facts, the appeal did not warrant interference on that ground. Any grievance that the extension was made without recording reasons was left to be pursued before the Tribunal by way of rectification.

Conclusion: The Tribunal did not lack power to extend stay beyond 365 days, and the issue was answered against the revenue and in favour of the assessee.

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