TMI Blog2002 (10) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 coverage and the implication of the amendments. For ease of reference the concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hough 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 where the "lis" arose before the amendment, the stay orders passed by the Tribunal even subsequent to the date of the amendment of the Section would not be hit by the bar of the amended Section. He submitted that the date of such lis arising would have to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use 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 orders staying recovery was a corollary of an order granting waiver of pre-deposit either wholly or partly. He stated that the Kerala High Court in the judgement in the case of Rubicon v. CCE - 1989 (44) E.L.T. 401 had held that in dealing with an application under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 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 had relied upon the observation of the Supreme Court in the case of ITO v. Mohammed Kunhi - 1992 ITR 341. 15.The two phrases used in the amended provision, therefore, must be interpreted to mean the orders made by the Tribunal in terms of Section 35F of the Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. 21.A consistent claim has been made that where the existing law provided for safeguarding of the interests of an assessee at the time when the dispute arose, the safeguard so provided shall continue to exist even where the law is subsequently changed. Citation is made on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate 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 retrospective so as to affect the existing or the vested right which has accrued to the petitioner prior to the said rule." 23.The Supreme Court in the case of Hoosein Kasam Dada (India) Ltd. v. State of Madhya Pradesh (supra) played down the effect on the assessees of an am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 of the Central Excise Act, 1944 and Section 254 of the Income Tax Act, 1961 being identical the prospective application of the provision in the Central Excise Act, 1944 stands established. 30.We find that the Income-tax Appellate Tribunal had occasion to deal with the very same issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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