2009 (10) TMI 772 - HC - Central Excise

Waiver and stay applications - Held that - Taking into consideration the entire facts and circumstances of the case it is provided that on a deposit of Rs. 10, 000/- as cost with the adjudicating authority at Kanpur within a period of two weeks it shall be open to the petitioners to approach the Tribunal along with the certified copy of this order and the receipt of the deposit of Rs. 10, 000/-. If such an application is filed before the Tribunal the Tribunal shall hear and re-examine the waiver and stay applications on merits after giving an opportunity of hearing to the petitioners in the light of the observations made above in accordance with law. It is made clear that if the petitioners fail to deposit the cost as stipulated above within the stipulated period of time the present writ petition shall stand dismissed. If the petitioners comply with the order of this Court the Tribunal shall rehear and redecide the stay and waiver application preferably within a period of two months. It has been brought to our notice that due to non-compliance of the impugned order the appeal filed before this Court has been dismissed. Since the said order has been set aside the appeal is also restored back to its original number subject to the fulfilment of the above conditions.

Summary

Issues:
1. Quashing of the order passed by the Custom & Service Tax Appellate Tribunal
2. Granting of waiver and stay applications
3. Appealability of the impugned order
4. Examination of the documentary evidence produced by the petitioners
5. Granting of one more opportunity to the petitioners to press the waiver and stay applications
6. Restoration of appeal due to non-compliance of the impugned order

Analysis:

1. The petitioners sought the quashing of the order passed by the Custom & Service Tax Appellate Tribunal, which directed them to deposit Rs. 10 lakhs. The Tribunal disposed of the waiver and stay applications, leading to the filing of the writ petition challenging the said order.

2. The petitioners contended that the Tribunal erred in not granting full waiver of the pre-deposit amount and committed a mistake by ordering a partial waiver of Rs. 10 lakhs. They argued that they were entitled to benefits under Small Scale Industries and modvat facility, emphasizing that they had paid more Excise Duty on inputs than the demand raised against them.

3. The Court addressed the issue of appealability of the impugned order and referred to a previous judgment stating that the appeal would lie before a Division Bench of the Court. The Court decided not to direct the petitioners to file a second appeal, considering it an exercise in futility due to the nature of the tax matter.

4. The Court examined the documentary evidence produced by the petitioners, noting discrepancies highlighted by the department. Despite this, the Court found that the Tribunal unjustly failed to consider the certificate filed by the petitioners, granting them an opportunity to reapply with the necessary documents.

5. Granting the petitioners one more chance, the Court allowed them to press the waiver and stay applications on merits upon payment of a cost of Rs. 10,000. The petitioners were directed to approach the Tribunal with the certified copy of the Court's order and the receipt of the deposit for a re-examination of their applications.

6. Due to non-compliance with the impugned order, the appeal filed before the Court had been dismissed. However, upon setting aside the order, the appeal was restored, subject to the conditions specified by the Court. The Court allowed the writ petition, setting aside the previous orders related to the case.

This detailed analysis covers the various issues addressed in the judgment, highlighting the arguments presented by both parties and the Court's reasoning in each aspect of the case.