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TMI Blog2010 (8) TMI 212X X X X Extracts X X X X X X X X Extracts X X X X ..... . The said products are subsequently sold from their depots to their rental outlets. The assessee was issued with a show-cause notice demanding the differential duty of Rs. 7,83,142/- (CENVAT Rs. 6,00,320.42 + SED Rs. 1,82,821.58) for the period 1-8-2001 to 28-2-2002 under the provisions of Section 11A apart from demanding interest at the rate of 24% under Section 11AB and proposal for penalty under Rule 25 of CE(2) Rules, 2001. The assessee gave his reply opposing the said claim. The Assistant Commissioner of Central Excise by his order dated 28-1-2003 held that the price charged in respect of motor spirit and high speed diesel at their COCO (Company Owned Company Operated) outlets should be treated as transaction value in terms of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 read with Section 4 of the Central Excise Act, 1944. Aggrieved by the said order, the assessee preferred an appeal before the Commissioner (Appeals), Mangalore who dismissed the appeal and upheld the order of the assessing authority. Aggrieved by the same, the assessee preferred an appeal before the CESTAT, Chennai. The assessee also filed an application for stay of the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom any angle, the impugned order requires to be set aside and the application for stay is liable to be dismissed. 4. Per contra, the learned counsel appearing for the assessee submitted, though in Section 35C before amendment and after amendment, there is no express provision conferring power on the Tribunal to extend the stay order granted earlier, the Tribunal in exercise of its appellate power has inherent power to grant an order of stay as well as to extend the stay granted earlier. In the absence of any specific provision prohibiting such extension, the power to extend stay is to be gathered from the appellate power as well as the inherent power of the Tribunal, that is the view, which is taken by the various Courts including the Apex Court and therefore, he submits, even if the order of the Tribunal is held to be erroneous, the assessee cannot be denied the benefit of extension of stay order. 5. In the light of the aforesaid facts and rival contentions, the point that would arise for our consideration is as under : In the absence of any express provision in the Act, for granting an interim order of stay (a) Whether the Tribunal has pow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provides for such a matter being dealt with by the Income-tax Officer. It is a firmly established rule that an express grant of statutory power carries with it by necessary implications the authority to use all reasonable means to make such grant effective. The powers which have been conferred by Section 254 on the Appellate Tribunal with widest possible amplitude must carry with them by necessary implication all powers and duties incidental and necessary to make the exercise of those powers fully effective". In the end, the Supreme Court has held as under : "Section 255(5) of the Act does empower the Appellate Tribunal to regulate its own procedure, but it is very doubtful if the power of stay can be spelt out from that provision. In our opinion, the Appellate Tribunal must be held to have the power to grant stay as incidental or ancillary to its appellate jurisdiction. This is particularly so when Section 220(6) deals expressly with a situation when an appeal is pending before the Appellate Assistant Commissioner, but the Act is silent in that behalf when an appeal is pending before the Appellate Tribunal. It could well be said that when Section 254 confers appellate jurisdicti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trial, and to the Court of Appeal before the second trial, as to the Court of last instance before the hearing of the final appeal". 7. The right of appeal is a substantive right, and the question of fact and law are at large and are open to review by the Appellate Tribunal. It is firmly established rule that an express grant of statutory power carries with it by necessary implications the authority to use all reasonable means to make such grant effective. One such authority is the duty in proper cases to make such orders for staying proceedings as will prevent the appeal, if successful from being rendered nugatory. Therefore, the appellate Tribunal has the power to grant stay as incidental and ancillary to its appellate jurisdiction. When the parliament introduced the amendment restricting the operation of the stay order, they recognized this settled legal position that the appellate Tribunal has the power to grant an order of stay even in the absence of a specific provision conferring such power, and such power flowing from the appeal provision itself. What they intended by the amendment is to restrict the duration of the stay order which is passed by virtue of such power, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y dilatory tactics. Therefore, this provision was introduced in terrorem. 10. The Supreme Court in the case of Commissioner of Cus. & C.Ex., Ahmedabad v. Kumar Cotton Mills Private Limited reported in 2005 (180) E.L.T. 434 (S.C.) dealing specifically with the amended provision, held as under : "3. The provision has clearly been made for the purpose of curbing the dilatory tactics of those assessees who, having got an interim order in their favour, seek to continue the interim order by delaying the disposal of the proceedings. Thus, depriving the revenue not only of the benefit of the assessed value but also a decision on points which may have impact on other pending matters. 4. The Tribunal which was then know as Customs, Excise Gold (Control) Appellate Tribunal (CEGAT) came to the conclusion that the amendment did not affect stay orders which were passed prior to the date of coming into force of the amendment and also held that the amendment did not in any way curtail the powers of the Tribunal to grant stay exceeding six months. 5. During the pendency of the appeal before this Court, the matter was conferred to a Larger Bench of the Tribunal. The Large ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stay beyond 180 days, the assessee's interest will be in jeopardy for no fault of his. Even the order granting exemption from pre-deposit will be rendered nugatory as the assessee will be compelled to satisfy the demand during dependency of the appeal. It has been always the judicial view that no party should be prejudiced due to action or inaction on the part of the Court (Rajkumar Dey and Others v. Tarapada Dey) 1987 (4) S.C.C. 398. 12. Therefore, it is clear that the sub-section though was introduced in terrorem cannot be construed as punishing the assessee for matters; which may be completely beyond their control. The sole object behind this amendment is to ensure speedy disposal of the appeals where orders of stay was granted and duty payable to the revenue are with-held. The said provisions act in terrorem preventing the assessee from delaying the disposal of the appeal. But if the assessee is not at fault and the Tribunal for reasons beyond its control is unable to dispose of the appeal within 180 days from the date of the grant of order of stay, the Tribunal cannot be held to be powerless to extend the order of stay granted on an application being made for extension ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e aforesaid Gujarat case, the order of stay was granted in the year 1996 and therefore, in that case, the Gujarat High Court was justified in holding when once an order of stay is granted after hearing both the parties, there is no requirement to pass any order extending stay of recovery already ordered and that, such stay of recovery shall remain valid till final disposal of the appeal and has refrained the Department from proceeding with the recovery proceedings pending disposal of the appeal on merits. In the very same judgment, they have also pointed out the difference after the amendment. Therefore, after the amendment, the stay order granted comes to an end at the expiry of 180th day from the date of the stay order. Rightly the assessee filed an application for extension. The Tribunal ought to have considered the application on merits and then should have passed the appropriate orders. Therefore, the order passed by the Tribunal is ex facie, illegal and is liable to be set aside. In view of the same, it is a matter which has to be remanded back to the Tribunal for disposal in accordance with law in the light of the aforesaid observations. 15. However, till the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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