Tribunal stay extension power survives beyond 365 days where delay is not attributable to the assessee, with pre-deposit treated separately.

The Appellate Tribunal's power to extend a stay beyond 365 days under Section 35C(2A) of the Central Excise Act was treated as incidental to its appellate jurisdiction, and the three provisos requiring vacation of stay after 180 days and 365 days were read as directory rather than mandatory. Their omission by Section 103 of the Finance (No. 2) Act, 2014 removed the earlier restriction on stay extension. The requirement of pre-deposit under Section 35F was held to operate independently of the stay-extension mechanism, and the Tribunal could continue the stay where delay was not attributable to the assessee.

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Issues: Whether the Appellate Tribunal has the power to extend a stay order beyond 365 days under Section 35C(2A) of the Central Excise Act, 1944, and whether the omission of the first, second and third provisos affects that power.

Analysis: The provision requiring disposal of appeals within three years, and the provisos prescribing vacation of stay after 180 days and 365 days, were held to be directory and not mandatory. The words "where it is possible to do so" showed that the legislature intended an expeditious disposal norm rather than an inflexible time limit. As the Tribunal's power to grant stay is incidental to its appellate jurisdiction, the omission of the provisos by Section 103 of the Finance (No. 2) Act, 2014 removed the earlier embargo on extending stay, and the requirement of pre-deposit under Section 35F operated independently of the stay-extension mechanism.

Conclusion: The Tribunal was not divested of its incidental power to extend stay beyond 365 days where the delay was not attributable to the assessee, and the appeals by the Department were without merit.

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