2009 (4) TMI 242 - HC - Customs

Court Waives Penalty Pre-Deposit, Stays Recovery Pending Appeal, Emphasizes Timely Disposal

NEDUMPARAMBIL P. GEORGE Versus UNION OF INDIA

The Court granted relief to the petitioner by waiving pre-deposit of penalty and staying recovery until appeal disposal. The Court emphasized the ... Tribunal has not disposed of the appeal within 180 days – proviso to section 129B(2A) of Custom Act - There is nothing on record to show that the appeal could not be heard on account of any act on the part of the petitioners herein - The second proviso literally read has the effect of vacating the stay on expiry of 180 days. There is therefore no power of extension conferred on the tribunal - The proper way to read the second proviso would be, that the Tribunal itself at the hearing of the stay application considering its docket and or the Benches available grants stay till the hearing and final disposal of the appeal. Once the Tribunal grants stay, in the absence of either the appellant or respondent applying for adjournments without justifiable cause with a view to delay the hearing, the Tribunal considering the duty on it is bound to hear and dispose of the appeal within 180 days - The proviso must be, to avoid being declared unconstitutional, be read to mean that it applies when the hearing of the appeal within 180 days could not be taken up on account of the persistent conduct or act of the appellant - Proviso cannot be read to defeat the vested right of appeal of an appellant - as nothing has been brought to our attention that it was on account of the acts of the petitioner that the appeal could not be heard, the relief sought for by the petitioner in the present petition will have to be allowed. Issues:1. Stay order on pre-deposit of penalty and recovery till appeal disposal.2. Interpretation of section 129B(2A) regarding disposal of appeal within a specified time.3. Application of previous judgments regarding extension of stay beyond 180 days.4. Tribunal's duty to hear and dispose of appeal within the stipulated time frame.5. Granting relief when the appellant is not at fault for delay in appeal disposal.Analysis:1. The Tribunal passed an order waiving pre-deposit of penalty and stayed recovery until the appeal's disposal. Respondent issued recovery orders for various amounts, including those against the petitioner. Petitioner argued against demanding amounts under appeal proceedings.2. The respondents cited section 129B(2A) regarding the disposal of appeals within a specified time frame. The provision mandates disposal within 180 days if a stay order is granted, failing which the stay order stands vacated. The Tribunal failed to dispose of the appeal within the stipulated time frame.3. Previous judgments were referenced, including one by the Supreme Court, emphasizing that the Tribunal must not extend the stay period unless due to valid reasons beyond the appellant's control. The Court applied this reasoning to the current case involving the Customs Act.4. The Court highlighted the Tribunal's duty to hear and dispose of the appeal within the specified time frame, especially when a stay order is in place. The Tribunal's failure to do so led to the stay order standing vacated by operation of law.5. The Court granted relief to the petitioner, emphasizing that the appellant should not be penalized for delays beyond their control. The judgment directed the Tribunal to dispose of the matter expeditiously within four months, ensuring the appellant's right to a fair hearing without undue delays.