Stay order challenged on not following decision of Co-ordinate bench

PJ/Case Laws/2012-13/1079

Stay order challenged on not following decision of Co-ordinate bench - whether can be entertained?

Case: PICASSO OVERSEAS VERSUS CESTAT, CHENNAI

Citation: 2012 (275) ELT 185 (MAD)

Issue:- Duty payment on final assessment demanded – appeal before the Tribunal – stay order of pre-deposit challenged that judgment of Co-ordinate bench not followed – petition rejected by holding that Tribunal had considered the said judgment.

Brief Facts:- Petitioner was assessed provisionally on the basis of investigation done by the Designated Authority with reference to the levy of anti-dumping duty. Petitioner executed a bond for the provisional assessment as per direction of Third Respondent and cleared the goods. Subsequently on the basis of Notification No. 138/2002, a final demand was raised for a sum of Rs. 2,73,31,320/- for the three import allowed clearance provisionally.

Aggrieved by this, Petitioner filled appeal before the second respondent. The second respondent without observing principles of natural justice dismissed the appeal filed by petitioner.

Petitioner challenged the said order before the Tribunal, the first Respondent herein. The Tribunal by order dated 13.03.2006 directed the second respondent to pass fresh order. In the course of the appeal before the second respondent the Petitioner was directed to pay 75% of the demanded duty. The Petitioner filed modification petition. However the second respondent dismissed the appeal filed by the Petitioner by order dated 20.06.2006 stating that the petitioner firm failed to comply with the interim direction for pre deposit of the duty.

Once again petitioner approached the Tribunal. The Tribunal by order dated 4.01.2007 [2008 (231) E.L.T. 293 (Tri-Chennai)], directed the second Respondent to rehear the appeal and pass order. As against the order passed by the second respondent dated 29.01.2009, petitioner approached the first respondent by way of the appeal and also filed an application for stay of recovery of the amount demanded.

The first respondent passed an order directing the Petitioner to comply with the pre-deposit of entire amount of duty for considering the appeal in terms of Section 129-E of the Custom Act, 1962.

The Petitioner has come before the High Court by filing Writ petition.

Petitioner’s Contention: - Petitioner contended that the issue is covered by the decision rendered by the Larger Bench of the Custom Tribunal. The Direction given by the Tribunal that the petitioner should deposit the entire duty amount for considering the appeal is not sustainable and against the order the principle of equity. The Petitioner further submit that the first respondent should have granted the waiver of pre-deposit of the entire amount of duty by following the decision of the Coordinate Bench in Mumbai in case of Harsh International v. Commissioner of Customs, Mumbai [2007 (217) E.L.T. 528, or in the alternative if the first respondent does not agree with the view of Coordinate Bench case, refer the matter to the Larger Bench for the Decision.

Petitioner pointed out that when the order had already been made by the Co-ordinate Bench on an identical circumstances, the first respondent should give exemption of duty and take up the appeal on merit. Hence, the Tribunal has failed to adhere to the Prima-facie case made out by the Petitioner and the Petitioner firm is entitled to get waiver of pre-deposit of the duty.

Petitioner referred to order passed in the CMA No. 341 of 2008 [2008(228) E.L.T.190 (Mad.)], that in the appeal preferred by the Revenue as against the order of exemption, this Court objected the plea of the Revenue and directed the Commissioner (Appeal) to take up the appeal on merit. In the circumstances, Petitioner pleaded that the Tribunal be directed to take up the appeal on merit without insisting of the duty. Petitioner has placed reliance on the decision of the Allahabad High Court in ITC Limited v. Commissioner (Appeal) Cus. & C. Ex, Meerut-I [2005 (184) E.L.T. 347 wherein on the Petitioner showing a Prima-facie case, the High Court directed the Appellate Authority to pass order in application for stay/waiver afresh in accordance with law, if possible the Appellate Authority is directed to decide the appeal itself within time. The High Court had granted stay in respect of recovery till a decision is taken in the application for Stay/recovery.

Reasoning of Judgment:- The High Court perused the order of the Tribunal and held that the same shows that considering the various issue raised by the petitioner and to the order of the Bombay Bench, the Tribunal pointed out that the balance of convenience is in favour of the Revenue and the financial hardship pleaded by the petitioner on the basis of the balance sheet of 2001-02 is not sufficient for considering the stay application.

The High Court noted that the Tribunal had also referred to the decision of the Apex Court reported in Assistant Collector of Central Excise, West Bengal V. Dunlop India Ltd and others [1985 (19) E.L.T. 22(SC) and Benara Valves Ltd. v. Commissioner of Central Excise 2006 (204) E.L.T. 513 (SC) as well as Vijay Prakash D.Mehta’s case [1989 (39) E.L.T. 178 (SC) to direct the Petitioner to deposit the entire Anti-Dumping Duty within a period of eight week from the date of hearing i.e. on 7-9-2009 and subject to the compliance thereof, the appeal of Petitioner should be taken up.

The High Court held that the decision relied upon cannot be applied straightaway to this case on hand. The mere fact that the Tribunal has not accepted the plea of the Petitioner as regard binding character of the Co-ordinate Bench does not means that the Tribunal had not considered the said contention. The High Court did not find any justification in the submission of Petitioner that the impugned order has to be set aside as the issue is covered by the decision of the Co-ordinate Bench. Hence no fault can be found on discretion exercised by the Tribunal. However Petitioner submitted that considering their financial difficulties the order to dispense with the payment be granted. While the financial difficulties projected by the petitioner may be one of the ground for considering the case of petitioner, yet for grant of relief for the Petitioner, considering the various fact of this case, interest of justice demand the petitioner to direct the deposit of Rs 75 lakhs within a period of eight weeks. After payment is made, the Tribunal be directed to take up the appeal and dispose of the same within a period of four weeks thereon without insisting of future payments.

Decision:- Petition disposed off.

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PJ/Case Laws/2012-13/1079

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