Whether appeal can be restored for compliance of stay order after 5 years ?

PJ/Case Laws/2012-13/1323

Case:-GLOBAL SYNTEX (BHL) LTD. Vs COMMISSIONER OF CENTRAL EXCISE, JAIPUR-II

Citation:-2012 (28) S.T.R. 447 (Tri-Del.)

Brief Facts:-The appellant were directed to make a pre-deposit of Rs. 25 lacs as the issue involved was of clandestine manufacture and removal of their final products i.e. processed man-made fabrics. But the appellant did not deposit the pre-deposit and it resulted in dismissal of appeal on account of non compliance of stay order. Appellant has made pre-deposit of Rs. 5 Lacs after a period of five years from the date of passing the stay order. The appellant made no efforts to deposit any amount or to make restoration application so as to keep the interest alive. Appellant have also not challenged the stay order or the subsequent dismissal order before any higher appellate forum to recall the order of dismissal of appeal. BIFR passed the order on reference under section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985, directing Tribunal to hear the appeal of company on deposit of Rs. 25 Lacs after 5 years of dismissal order.

Appellant Contentions:-The ld. Counsel for the appellant draws attention to the order passed by BIFR on 4.3.2010 which states:

“The company would deposit Rs. 25 Lacs with the Excise Department out of the direction of 25% by CESTAT within two weeks. In the interest of revival of the company, CESTAT is directed to consider hearing the company’s appeal on deposit of Rs. 25 Lacs.”

He further submits that in terms of direction of BIFR, they deposited the amount of Rs. 25 lacs and as such, their appeals should be restored.

Respondent Contentions:-The learned SDR submits that BIFR is not an appellate authority over the Tribunal, such directions made by the BIFR are beyond their jurisdiction and power and for this reason, Tribunal is not bound to follow the above direction of the BIFR. In any case, the appellants have not deposited the amount within two weeks as directed by BIFR. He submits that the appeals were dismissed five years back and the appellants have not made any efforts to deposit any amount in between. The appellants have not approached the Tribunal for restoration of their appeals. If the appellants were aggrieved with the order of the Tribunal, they were well within their right to challenge the same before Hon'ble High Court. Respondent prays for rejection of the restoration of the applications.

Reasoning of Judgment:-After appreciating the submissions made by both sides and after going through the direction made by BIFR, Tribunal finds that B1FR passed the order on reference under section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985. The said order of the Tribunal or the subsequent dismissal was not the subject of challenge before BIFR, though same may be one of the factors to be considered by them while passing the order on reference. It was also noted that BIFR is not an appellate authority and as such we fully agree with the respondent that the direction contained in the said order of BIFR reproduced above were not called for and are beyond their jurisdiction and power. The CESTAT is not bound to follow the same. Learned Advocate has not been able to show as to how BIFR is exercising as an appellate authority over the Tribunal and is directing to recall the order.

Otherwise also, the observations made by BIFR that the Tribunal directed 25% of the duty confirmed are factually incorrect. The direction was to deposit 25 lacs by BIFR. In any case, BIFR directed the applicants to deposit 25 lacs within a period of two weeks from the date of passing order. The deposit of the same stands made after more than two and a half months.

Tribunal finds that the stay order as also subsequent dismissal order have not been challenged by the appellants before any higher appellate forum and there was no direction by higher appellate forum to recall the order of dismissal of the appeals. Appellant had deposit amount after a gap of five years. From the date of passing the stay order, no efforts made to deposit any amount or to make restoration application so as to keep their interest alive. Tribunal finds no justifiable reasons to recall the order of the dismissal, the applications are rejected

Decision:-Appeal rejected.

Comment:-The analogy drawn from the above case is that only an authority higher than Tribunal can direct it to re-consider the order passed by Tribunal. The Tribunal is not bound to follow direction of BIFR when it is not an appellate authority over the Tribunal and that too after unreasonable period of 5 years.

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PJ/Case Laws/2012-13/1323

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