2006 (2) TMI 372

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....ed. 2. They were to report compliance on 16-3-2006. Before the date of compliance the appellants have filed the above noted Miscellaneous Application under Section 35C(2) of CE Act asking for rectifying the mistakes on the grounds stated in the Miscellaneous Application. 3. The learned SDR submitted that an application for rectification of mistake under Section 35C(2) is maintainable and it is to be filed only when a final order has been passed by the Tribunal. It is his submission that application is not maintainable in terms of the said provisions. 4. The learned Counsel submits that the application may be treated as an application for modification of the Stay Order already passed directing them to pre-deposit the entire amount on the ground given therein. He submits that the grounds made in the Miscellaneous Application may be treated as for modification of the Stay Order as per Rule 41 of the CE Act. 5. The prayer of the Counsel to treat the application for modification of the stay order is accepted. The application cannot be treated as rectification of mistake under section 35C(2) of the CE Act, as the application for rectification of mistake ar....

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....terim order passed under Section 35F of the CE Act. He submits that this order of McDowell & Company Ltd. (supra) has also been followed by the same Karnataka High Court in the subsequent writ petition filed by M/s. United Telecom Ltd. vide WP No. 25431 of 2005 (T-TAR) [2006 (198) E.L.T. 12 (Kar.)]. He contends that the Divisional Bench of Karnataka High Court in the case of ITC Ltd. v. CCE & C - ILR reported in 2000 KAR (25) has held that once the appellants demonstrates to the Tribunal that their case is required to be allowed on merits, then they are required to be granted full waiver of pre-deposit of the amounts. He also submits that the Apex court in the case of Mehsana District Cooperative Milk Producers Union v. UOI reported in 2003 (154) E.L.T. 347 (S.C.) has held that no pre-deposit is required to be made in case the appellant establishes that the appeal is required to be allowed on facts of the case. He further submits that the Stay Order is required to be recalled and full waiver to be granted by allowing the Miscellaneous Application, in view of the fact that the Commissioner (A) in the case of M/s. Falcon Tyres Ltd. vide Order-in-Appeal No. 175/2005 dated 8-9-2005 has....

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....sit is to be granted. The Tribunal has also inherent powers to recall or modify its interim orders. However, we are now faced with two different directions given by the High Court in the case of CCE v. M/s. United Telecom Ltd. (supra) and McDowell & Company (supra). We also find the views expressed in these two orders are also contra to the view expressed by earlier order of Karnataka High Court and Apex Court. But keeping in view the dicta given to us in these two orders and in keeping with the judicial discipline, we are of the view that we are not in a position to recall the said stay order in question. The appellants' contention is that the Commissioner (A) in the case of M/s. Falcon Tyres Ltd. has dropped the demands and hence, the said stay order is required to be recalled. The learned SDR at this stage pointed out that he has no information about the Revenue filing an appeal before the Tribunal. This issue is covered in the Revenue's favour in the case of Birla Tyres (supra). He further submits that the Larger Bench judgment cited in the Stay Order is applicable to the facts of the case and the matter was sent back only for re-quantification of duty. The assessee had not app....

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....e concept of undue hardship in the context of taxing statutes and occurring in a provision like the pre-deposit provision under Section 129E can only be linked to the financial hardship that the assessee faces if the assessee has to comply with the pre-deposit requirement and cannot be anything else. Unless an assessee pleads the financial hardship for the compliance of pre-deposit and the assessee in fact is unable to pay the pre-deposit amount in reality also, there is no undue hardship as contemplated in the proviso to Section 129E. In the present case it is not even the case of the appellant before the Tribunal that it faces any financial hardship or has any difficulty in this regard. Even in the absence of any plea from the appellant before the Tribunal to this effect, the Tribunal ventures upon to grant total waiver of pre-deposit. It is undoubtedly yet another instance of as observed by this court in the case of Mc Dowell & Company (supra) the Tribunal being more loyal than the king. It is rather surprising that the Tribunal persists in ignoring the statutory provisions as contained in the proviso to Section 129E in passing such order for the purpose of pre-deposit when the ....