1994 (7) TMI 164 - AT - Central Excise

Tribunal denies stay on gold confiscation proceedings, emphasizes need for defense presentation and response to notice.

The appellate tribunal declined the application for a stay of adjudication proceedings concerning the confiscation of gold biscuits. The tribunal found ... Stay of interlocutory order Issues: Stay of adjudication proceedings, Ex parte order of confiscation, Prejudice to defense in criminal trial, Jurisdiction of adjudicating authority, Balance of convenience, Stay of penalty proceedings, Interlocutory orderThe judgment pertains to an application for a stay of adjudication proceedings before the Collector of Customs, Jaipur, involving the confiscation of 96 foreign marked gold biscuits seized from three individuals. The applicants sought a stay, contending that the impugned order of confiscation was ex parte and could prejudice their defense in a criminal complaint. The applicants had filed multiple applications for stay, including a writ petition dismissed by the Rajasthan High Court. The adjudicating authority rejected the request for stay, prompting the applicants to approach the appellate tribunal seeking relief. The applicants argued that the adjudicating authority had prejudged the issue without giving them a full opportunity to be heard, potentially impacting their defense in the criminal trial. They claimed that irreparable loss would result if the proceedings were not stayed, emphasizing the balance of convenience in their favor.The learned counsel for the applicants highlighted that the impugned order of confiscation was passed without any claim made by the noticees regarding the seized gold. On the other hand, the respondents argued that the Collector had the jurisdiction to adjudicate on the penal liability of the applicants, and no grounds were presented for staying the penalty proceedings. The tribunal considered both sides' submissions and determined that the applicants had not sufficiently demonstrated a case for staying the penalty proceedings. It was deemed essential for the applicants to present their arguments before the Collector and clarify the reasons for not responding to the show cause notice. The tribunal rejected the application for stay, stating that the continuation of proceedings would not prejudice the applicants' defense in the criminal court. Reference was made to a Supreme Court case emphasizing the need to await the decision of the trial court in complex cases to avoid prejudicing the defense. Additionally, the tribunal noted that intervening at that stage would effectively stay an interim order, which fell outside its jurisdiction. Consequently, the application for a stay was declined, and the tribunal upheld the decision to reject the application in open court.