1994 (2) TMI 196 - AT - Central Excise

Tribunal rejects limitation plea, waives pre-deposit in tax appeal. Revenue recovery barred pending appeal.

The tribunal rejected the plea of limitation, considering the appellant's non-involvement in previous proceedings. Due to financial hardship, the tribunal ... Stay/Dispensation of pre-deposit Issues:- Appeal against the order passed by Collector of Central Excise, Madras- Stay applications for dispensing with pre-deposit of duty and penaltyAnalysis:The appellants, Shri C.N. Sukumaran and Shri V.G. Hirusah, filed appeals against the order by the Collector of Central Excise, Madras, and also submitted stay applications to waive the pre-deposit of duty and penalty amounts. The main arguments presented by the appellants' advocate included a plea for limitation based on the brand name ownership and the applicability of Notification No. 140/83-CE. Additionally, they argued for a deduction of duty from the price under Section 4(4)(d)(ii) of the Central Excises and Salt Act, 1944, citing relevant tribunal decisions. Financial hardship was highlighted, with details of the appellant's capital and profit for the years ending 31-3-1991 and 31-3-1992. The advocate requested dispensation of duty and penalty amounts due to financial constraints.The respondent's representative argued against the appellant's plea for limitation and deduction of duty, stating that these were previously addressed and rejected by the Collector. It was contended that the extended period of limitation could be invoked in this case, especially since Shri Sukumaran was not a party in the earlier adjudication. The respondent urged for the rejection of the stay applications based on these grounds.After hearing both sides and examining the case details, the tribunal found that Shri Sukumaran was not a party in the previous proceedings, thus rejecting the plea of limitation. Regarding financial hardship, the tribunal reviewed the profit and loss accounts of Shri Sukumaran and considered the proposed payment amount of Rs. 60,000. Citing relevant legal precedents, including decisions of the Hon'ble Supreme Court and the Tribunal, the tribunal concluded that the pre-deposit amounts of duty and penalties would cause undue hardship to the appellants. Consequently, the tribunal dispensed with the pre-deposit of duty and penalties, with a condition for Shri Sukumaran to deposit Rs. 60,000 within three months. The tribunal also waived the pre-deposit of the penalty amount for Shri Hirusah. The tribunal directed that during the appeal pendency, revenue authorities should not pursue recovery, with a warning that non-compliance would vacate the stay order. The stay applications were partly allowed and fully allowed for the respective appellants. The matters were scheduled for mention on 1st June 1994.