TaxTMI 
TaxTMI 
2002 (10) TMI 116
X X X X Extracts X X X X
X X X X Extracts X X X X
....portion of this communication reads as under : "In this connection, it is brought to your notice that after the introduction of sub-section (2A) in Section 35C of CEA, 1944 in the recent Budget, any stay including a partial stay if granted by the Hon'ble CEGAT in any appeal, the same should be disposed of within a period of 180 days from the date of such order if such appeal is not disposed of within the specified period the stay order shall, on expiry of that period stand vacated. In view of the above, it is requested to let this office know whether your aforesaid appeal is disposed of or not, if not, please pay up the Govt. dues outstanding within two days failing which action under C.Ex. provisions will be taken against you". 3.The present miscellaneous application has been filed seeking orders for continuation of the stay order notwithstanding the amendment made in Section 35C of the Act. 4. Since the issue has substantial consequences and since the amendments would give rise to a number of similar situations the application was posted for disposal and advocates and consultants not representing the applicants were also permitted to contribute their views on the cove....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the suit. (iv) The right of appeal is a vested right and such a right to enter the superior Court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgement is pronounced such right is to be governed by the law prevailing at the date of the institution of the suit of proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal. (v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise." 7.The Supreme Court in the cited judgment held that where the "lis" arose the right to pursue the appeal to the higher forum was vested in the person where the value was Rs. 10,000/-. It was held that the right would continue to exist even if by subsequent amendment the limit of value was raised. Shri Jain cites this case and submits that following the ratio of the judgment not only will the amendment to the Section not cover the orders in stay made prior to that date; but also w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....be covered by the amendment as having a life span of six months. Such orders would include those where the department's proposal to auction certain goods is stayed. It may also include those orders which stay the issue of future action such as issue of show cause notices. In this respect he cites the Delhi High Court in the case of ITC Ltd. v. U.O.I. - 1983 (12) E.L.T. 1 (Del.) which was followed by the Tribunal in the case of CCE v. Karna Industries Ltd. - 1991 (53) E.L.T. 566. It is stated that the Tribunal's right to grant waiver of pre-deposit in terms of Section 35F of the Act was not disturbed by the present amendment. In the absence of non-abstante clause the amendment could not be called to be retrospective in application. In this statement he relied upon the Supreme Court judgement reported in AIR 1960 SC 980 (State of Bombay v. Supreme General Films Exchange Ltd.). As regards the arising of "lis" it was his impression that it could be said to arise from the date of issue of show cause notice. 10.Shri K.M. Mondal, Consultant submitted that the expression "stay order" was not a fresh expression but that it was implied in the scheme of Section 35F. He stated that the orde....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to the interpretation of the two phrases namely "order of stay" and "stay order" appearing in sub-section (2A) of Section 35C. It was argued that the phrase does not appear in connection with the orders made by the Tribunal in terms of Section 35F. It was therefore argued that this provision and the time limit set thereunder would apply only in those cases where the Tribunal's order did not deal with waiver of pre-deposit of any sums, but dealt with prayers for stay of operation of the impugned order. Shri Mondal, however, referred to the provisions of CEGAT (Procedure) Rules, 1982, Rule 28A thereof has the following wording : "Procedure for filing and disposal of stay petitions : (1)(a) Every application preferred under the provisions of the Acts stay of requirement of making deposit of any duty demanded or penalty levied --" 14.Delhi High Court in the judgment in the case of ITC Ltd. - 1983 (12) E.L.T. 1 (Del.) had observed that the powers of the Tribunal contained in the proviso to Section 35F were of vide amplitude. It is observed that the Tribunal had inherent power of granting relief in exercise of their appellate jurisdiction. In making this observation the Court h....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re instances where under the same Act, an amendment is made retrospective in application. Section 11B of the Act was amended vide Central Excise and Customs Laws (Amendment) Act, 1991. Sub-section (3) of the amended section reads as follows : "Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the appellate Tribunal or any Court or in any other provision of this Act or the Rules made thereunder or any other law for the time being in force, no refund shall be made except as provided in subsection (2)." 20.The effect of this amendment was that it superseded all previous actions made under the unamended law and substituted another provision of the amended law under which the refund claims were required to be processed. In the absence of any such clause in the amended Section 35F of the Act it has to be held that the amendment is not retrospective in nature. It would therefore follow that all those orders made by the Tribunal in terms of Section 35F of the Act before 11-5-2002 would remain operational until the disposal of the respective appeals and would not be hit by the bar of the second proviso to sub-section (2A) of Section 35C.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ise duty, of which refund is claimed, is made and a right to refund thereof arose prior to 6-8-1977 i.e. the date on which the new rule 11 has come into force. The said right to claim refund is a vested right which has accrued to the petitioner prior to new rule 11, or at any rate is an existing right. It is a settled principle of interpretation of statutes that a vested right or even an existing right, including a right of action is not affected or allowed to be taken away unless it is so affected or taken away by the enactment expressly or by necessary implication. It is only a declaratory or a procedural enactment which is normally held to be retrospective. A remedial Act, on the contrary, is not necessarily retrospective, it may be either enlarging or restraining and it takes effect prospectively, unless it has retrospective effect by express terms or necessary intentment. [See AIR 1960 S.C. 12 (para 29) - The Central Bank of India and others v. Their Workman and also AIR 1973 S.C. 1227 - The Workmen of M/s. Firestone Tyre and Rubber Co. of India P. Ltd. v. The Management and Others]. It is, therefore, necessary to be seen whether the provisions of new rule 11 can be held to be....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... are passed after 11-5-2002. Their validity, in terms of the amended provision would be of 180 days from the date of their being made and the earliest date of expiry of the very first order would be 10-11-2002 and that date is not too far. The question arise would is as to the remedy available for the assessees who are covered by a stay order which is nearing expiry. 28.It was argued that the power of the Tribunal to grant waiver and stay under the provisions of Section 35F, is not circumscribed by an amendment putting a time frame on such orders. In fact, Shri Pundir, Chief Departmental Representative, very fairly concedes that the Tribunal could make the same order once again at the end of the period of its validity or may simply extend the validity thereof. 29. When Section 254 of the Income Tax Act was amended vide Finance Bill, 2001, the measure was termed as one for "reducing litigation". The amendment to stipulate the life span of 180 days for a stay order was declared to apply "in relation to stay granted on or after that date". Curiously, there is no such clarification in the Finance Bill, 2002. However, as we have observed above, the sub-section (2A) of Section 35C ....