PML INDUSTRIES LIMITED Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) This order shall dispose of the afore-mentioned writ petition along with other writ petitions mentioned in the foot note of this order in respect of the provisions of Section 35C(2A) of the Central Excise Act, 1944 (for short 'the Act'), whereby an order of waiver of pre-deposit of duty passed by the Tribunal stands vacated after expiry of 180 days, if the appeal is not decided in terms of the provisions inserted by Section 140 of the Finance Act, 2002 with effect from 11.05.2002 (hereinafter referred as 'first set of cases') and writ petitions such as CWP No.1606 of 2012, wherein the challenge is to the Circular issued by the Central Board of Customs & Excise (for short 'the Board') on 01.01.2013 (Annexure P-3) and further quashing of the demand raised in pursuance of such Circular. The Circular dated 1.1.2013 contemplates that the recovery shall be affected, if stay has not been granted within 30 days (hereinafter referred as 'second set of cases').

(2.) In CWP No.844 of 2013 falling in the first set of cases, the petitioner has pointed out that against the Order-in-Original dated 31.05.2007 and 21.08.2007, the appeals were filed before the Commissioner (Appeals), Customs & Central Excise, Chandigarh. The Commissioner (Appeals) upheld the order passed by the Adjudicating Authority on 17.01.2008. The petitioner filed further appeal before the Customs, Excise & Service Tax Appellate Tribunal (for short 'the Tribunal'). The Tribunal waived the deposit of duty and penalty as well as recovery subject to deposit of Rs.5 lacs vide order dated 19.05.2008. Since the appeal could not be heard within the prescribed period of one hundred and eighty days for no fault on the part of the petitioner, therefore, in terms of the Supreme Court decision in Commissioner of Customs & Central Excise, Ahmedabad Vs. Kumar Cotton Mills Pvt. Ltd., 2005 180 ELT 434, the Tribunal ordered the interim stay to continue till further orders on 03.03.2009. In spite of such order, the Department initiated the recovery proceedings vide communication dated 20.11.2012 (Annexure P-8), as the stay is said to have come to an end after the expiry of one hundred and eighty days. In pursuance of such communication, the petitioner informed the Department that the Tribunal has granted stay and the same was extended till further orders. However, the Department again directed the petitioner to deposit the dues vide letter dated 17.12.2012 (Annexure P-10), which led to invocation of the jurisdiction of this Court.

(3.) Mr. Jagmohan Bansal, learned counsel for the petitioner argued that the second proviso incorporating provisions of automatic vacation of stay is onerous and makes the remedy of appeal illusory and nugatory, as on the expiry of one hundred and eighty days of the stay, the stay is automatically deemed to be vacated, even if the assessee is not in fault in any manner. It is argued that the right of appeal has to be meaningful and cannot be a farce, when without any fault of the assessee, the stay is vacated. The petitioner had made out case for waiver of condition of pre-deposit, but still on the basis of administrative circular, the recovery is sought to be initiated. Learned counsel relies upon an order passed by the Supreme Court in Kumar Cotton Mills Pvt. Ltd. case , wherein the Court observed to the following effect: