TaxTMI 
TaxTMI 
TaxTMI 
2013 (9) TMI 169
X X X X Extracts X X X X
X X X X Extracts X X X X
....ismissed for non-compliance. 3. For better appreciation, we reproduce relevant paragraphs from the impugned orders of the Commissioner (Appeals) : "7. The appellant no. 1 vide their letter dated 15-4-2010 has informed this office that they are not in a position to deposit the said amount due to some unavoidable circumstances and made a request to exempt them from depositing the said amount and reconsider it. I observe that the appellant has failed to comply with the Stay Order No. 02-03 (DK)JPR-I/2010 dated 24-2-2010 and has not made deposit of Rs. 20,00,000/- (Rs. Twenty lakh only) by the stipulated time of 30 days from the receipt of the Stay order nor has given any specific reasons in the letter dated 15-4-2010 which may be justifying the either extension of time limit or variation in the quantum of pre-deposit or exemption from pre-deposit." As is seen from the above, after passing of the said order, the applicant had moved an application dated 15-4-2010 for modification of the earlier stay order passed by the Appellate authority. Commissioner (Appeals) vide his impugned order had rejected the modification application as also dismissed the appeals vide the same order. 4. We....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion about the decision on the modification of the application, the appellant cannot be expected to know about the same. As such, dismissal of the appeal for non-compliance along with rejection of the modification application violates the basic principle of natural justice. 6. In view of our foregoing discussion and keeping in the view the applicant had already deposited an amount of Rs. 15 lakhs, we dispense with the condition of pre-deposit of balance amount of duty and penalties imposed upon both the applicants and set aside the impugned order and remand the matter to Commissioner (Appeals) for reconsideration of the modification application before him. Needless to say a separate order should be passed on the modification application filed before him and be intimated to the applicant accordingly. 7. Both the stay petitions as also the appeals get disposed of in the above manner. 8. I have gone through the order recorded by Member (Judicial). Since I am not agreement with the order recorded by Member (Judicial), I am recording this separate order. 9. As already stated the facts of the case are that the Commissioner (Appeal) called for pre-deposit of a part of the duty confirm....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fresh facts justifying reconsideration of earlier order, the Courts have ruled in favour of fresh consideration of the matter. The following decisions relied upon by Tribunal while deciding the case of Prem Nath Mooga Beverages may be seen,- (a) T.N. Electricity Board v. CEGAT - 1991 (55) E.L.T. 165 (sic) (b) Punjab Paints, Colours and Varnish Works v. CEGAT - 1987 (32) E.L.T. 656. In these cases the assessee had submitted fresh facts which were relevant for re-considering the application. On the other hand the case at hand is a case where the appellant did not give any valid reason for modification of stay. So it is very obvious that the appellant was just trying to gain time by filing a modification application and I am of the view that the Commissioner (Appeals) was right in rejecting the appeal for the reason that stay order has not been complied with. 14. The modification application filed by the appellant already stands rejected by the Commissioner (Appeals) for valid reasons. Allowing the appellant to go for another round of proceeding without further pre-deposit in this matter does not meet the ends of justice. I am using the expression "ends of justice" with an underst....
X X X X Extracts X X X X
X X X X Extracts X X X X
....mate the result of such decision to the appellants and in case of rejection, extend the period to deposit and then to decide the appeal subsequently. This patent illegality in the orders of the Commissioner (Appeals) cannot be rectified at the stage of higher appellate forum and has to be rectified by him only. It may not be out of context to mention here even the CESTAT whenever they reject the modification application, extend the period to deposit the directed amount in the interest of justice. Commissioner (Appeals) should have followed the said proceeding and that is why the matter stands remanded to Commissioner (Appeals). Pronounced 17. Present reference under Misc. Order No. 264 of 2012 arose against difference of opinion between learned Members of the Division Bench of the Tribunal at the stage of hearing of interim applications Nos. 2066 and 2067 of 2010 praying for stay of realization of the demands involved in Appeal Nos. E-2165 and 2166 of 2010 instituted against order of learned Commr. (A) dismissing first appeals of the appellants by order dated 21-4-2010 for their failure to make-deposit of Rs. 20.00 lakhs ordered by him vide Stay Order No. 02-03(DK) JPR 1/2010, da....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o its jurisdiction, such authority must act with utmost fairness. Its fairness is obviously to be manifested by the fair play and demonstrated without a close mind which is in consonance with the scheme of impartial judicial act. The principle that justice must not only be done but it must eminently appear to be done as well as equally applicable to quasi judicial proceeding if such a proceeding has to inspire confidence in the mind of those who are subject to it. Apex Court in the case of Commissioner of Income Tax v. Anjum M.H. Ghaswala and Others, (2002) 1 SCC 633 has held that once an authority is required to act in a particular manner stipulated by the provisions, the authority is bound to act accordingly and cannot deviate from doing so. 22. Apex Court in Para 51 of the judgment in the case of M/s. Kranti Associates - 2011 (273) E.L.T. 345 (S.C.) after considering various judgments formulated certain principles touching transparency in fair justice delivery system. In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision making not o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....appeal as ordered by Member (Judicial)? Or Whether the applicant should be asked to make the pre-deposit ordered by the Commissioner (Appeals) and then argue his case before the Commissioner (Appeals) as ordered by Member (Technical)? 26. Appeals pass through two stages i.e., stage of stay hearing and the stage of appeal hearing as is laid down by Apex Court in the case of Alex Enterprises v. Union of India - 2009 (236) E.L.T. 10 (S.C.). Right of appeal being conditional as held by Apex Court in the case of Vijay Prakash D. Mehta - 1989 (39) E.L.T. 178 (S.C.) = 1988 (4) SCC 402, the first stage is to cross the hurdle of pre-deposit. Only after that stage, subject to compliance to the interim order, if any, assessee gets right to be heard on appeal in full length and fair opportunity is granted to place his case to decide the contentious issues involved. 27. While interest of Revenue weighs consideration, undue hardship that an assessee may suffer by an interim order also equally invites attention of the Courts while hearing interim applications. So also, the law laid down by Apex Court in Dunlop India Ltd. - 1985 (19) E.L.T. 22 (S.C.), Vijay D. Mehta - 1988 (4) SCC 402 : 1989 (....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ere dealers in food grains and essential commodities have been allowed to take back the stocks seized from them as if to permit them to continue to indulge in the very practices which were to be prevented by the seizure. We have come across cases where land reform and important welfare legislations have been stayed by courts. Incalculable harm has been done by such interim orders. All this is not to say that interim orders may never be made against public authorities. There are, of course, cases which demand that interim orders should be made in the interests of justice. Where gross violations of the law and injustices are perpetrated or are about to be perpetrated, it is the bounden duty of the Court to Intervene and give appropriate interim relief in cases where denial of interim relief may lead to public mischief, grave irreparable private injury or shake a citizen's faith in the impartiality of public administration, a Court may well be justified in granting interim relief against public authority. But since the law presumes that public authorities function properly and bona fide with due regard to the public Interest, a Court must be circumspect in granting interim orders of f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....31. Investigation also revealed that most of the consignments diverted were unloaded at various cutters' premises at Jaipur. Excess payments of freight paid by cheques were partly returned in cash to the appellant company without explaining any good reason why such refunds were made. Section 14 evidence established oblique motive of parties. Instruction issued by aforesaid 2 persons for diversion of the impugned goods was categorical admission in the statement recorded. Statutory records were manipulated to make pretence of consumption of goods in manufacture although such goods were diverted. 32. Physical inventory during investigation resulted in excess stock of 12.05 MT of HR Coils/scrap as per Panchnama dated 6-10-2006. Excess generation of scrap was false and such falsity was recorded to make artificial sale thereof in absence of such generation. Evidence recorded from Shri Ajay Kumar Jain, Director of M/s. Naman Castings Pvt. Ltd. revealed that said company was purchasing scrap from the appellant without sale thereof being covered by invoices. 33. Statement dated 6-10-2006 recorded from Shri Sunil Singh, Proprietor of M/s. Biwadi Behrore Road Lines revealed that copies of b....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., the said court in the absence of statutory provision becomes functus officio and is disentitled to entertain a fresh prayer for the same relief unless the former order is set aside by a court of competent jurisdiction in a manner prescribed by law. The court becomes functus officio the moment the official order disposing of a case is signed. Such an order cannot be altered except to the extent of correcting a clerical or an arithmetical error. 38. It is not permissible for any one to re-open a proceeding by a modification application for review of the earlier order in disregard of the statutory bar of review. A three judges Bench of Apex Court in the case of Major Chandra Bhan Singh - (1979) 1 SCC 321 following the precedent in Harbhajan Singh v. Karam Singh, (1966) 1 SCR 817 approving the earlier privy counsel decisions on Baijnath Ram Grenka v. Nand Kumar Singh 40 IA 54 : ILR 40 Cal 552 : 15 Bom LR 500; Ananth Raju Shetty v. Appu Hegade AIR 1919 Mad. 244; Patel Chunibhai Dajibhai v. Narayan Rao Jambekar AIR 1965 SC 1457 held that review is a creature of statute but not an inherent power and cannot be entertained in the absence of a statutory provision in that regard. So also w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....experience shows that in almost all the applications moved to seek modification of the Tribunal's order contain only grounds of review. They are freely entertained by the CEGAT and the same are sometime accepted or rejected on merits with detailed order. Such exercise, apart from labour, must be consuming major part of its working hours. This wastage of labour and working hours can easily be saved by the CEGAT, if application moved in this behalf is prima facie, examined by CEGAT to find out whether any change in circumstance after the previous order, is shown with sufficient material in that behalf; or any other reason prima facie; exists warranting modification of the previous order on the ground which was not available when the previous order was made. At the threshold, if such preliminary enquiry is made by the Tribunal, we are sure in most of the cases application may not be required to be heard on merits. Had such enquiry been made by the CEGAT in this behalf in this case, we are sure. Tribunal would have saved its labour and time and would not have been required to devote nine pages for writing impugned order. We direct that henceforth the Tribunal shall first make prima fac....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the case of Director. There was nothing new fact or circumstances brought out by application dated 15-4-2010 by the appellant to claim same relief as that was made earlier. Therefore, on self same ground appellant's appeal was bound to be dismissed without any power of modification with the Commissioner (A) by Central Excise Act, 1944. It was also submitted that Tribunal cannot confer power on the Commissioner (Appeals) to make modifications of the stay orders which is not permitted by law. He relied on the decision in the cases of Ambassy Contractors Pvt. Ltd. v. CCE, Bangalore-III - 2010 (256) E.L.T. 349 (Kar.) and Lindt Exports v. Union of India reported in 2011 (269) E.L.T. 53 (Del.) to submit that pre-deposit directed by the Commissioner (Appeals) was proper and there should not be intervention to the same. 44. Heard both sides and perused the record. 45. Law relating to the power of modification has been elaborately discussed in the preceding paragraphs. Ld. DR was right to say that the ground of financial difficulty was before ld. Commissioner (Appeals) at the stage of stay hearing itself and the application dated 15-4-2010 is on the self same ground of relief claimed ....