Sarla vs CAG-What happens now?
NOW that Board has accepted the CAG objection and virtually ignored the CESTAT decision in Sarla Performance Fibres case 2010 -TIOL-408-CESTAT-AHM, what will happen in the field?
Show Cause Notices will go to every EOU having DTA clearance. The first adjudicating authority will straight away confirm the demand as they are bound by Board's acceptance of the CAG objection. Energetic Commissioner (Appeals) will require pre-deposit to hear the appeal. Somehow take the case to the Tribunal. Tribunal is not bound by Board and CAG. It has to go by precedent and as of now there is no judgement contrary to the Sarla case and so Tribunal is bound to rule that third time cess is not payable.
That will take litigation back to the adjudicating authority - he will use every rule in the book to reject refund. He will shout “unjust enrichment”. Litigation may go on for another four years!
Who benefits from all this mockery of the legal system? The lawyer/consultant of course. But for the benevolent Board, 90 per cent of the consultants in this country would have been out of business! I often feel guilty trying to bite the hand that feeds me.