CESTAT - Revenue cannot file Stay application against Appellate Commissioner's Order
IN a recent case before the Bangalore Bench of the CESTAT, the Revenue was aggrieved by the order of the Commissioner (Appeals) and filed a Stay Application under Section 35 of the Central Excise Act, 1944.
Now, Section 35 deals with Appeals to Commissioner (Appeals) and not the Tribunal. Under what authority and for what purpose should Revenue file a Stay Petition against an order of a Commissioner (Appeals).
[An aside: In a case I represented before the Tribunal, the Appellate Commissioner's order was partly in my favour and partly against. Against the adverse order, I filed an appeal and a Stay petition praying for waiver of pre-deposit and stay of recovery. Strangely, Revenue also came up with a Stay Petition seeking stay of the entire order. I requested the Tribunal to allow the Revenue's petition. The Bench laughed and advised the DR to send the officers to NACEN for training on how to file appeals.]
In the present case, the Tribunal observed,
In the entire Chapter VIA in the Act, there is no provision that an application can be filed, especially by the Revenue department, seeking stay of operation of the impugned order till disposal of appeal by the appellate authorities. Filing of such application has no legal sanctity because, neither any duty demand has been confirmed nor any penalty imposed in the adjudication order against the Revenue department. Hence, in my considered opinion, in absence of any specific provisions contained in the Central Excise statute, the department is precluded in filing the application, seeking stay of operation of the impugned order. Further, I find that the application for stay has been filed under Section 35 of the Act, which deals with filing of appeals before the Commissioner (Appeals). There is no reference in the said Section for filing the stay application before the Appellate Tribunal.
This is how the Tribunal is clogged. The irresistible urge of Revenue to file an appeal even in the rarest of rare cases when the field officers could not pass an order in favour of Revenue, results in all kinds of waste paper landing in the Tribunal.
Let us see this situation:
An AC passes an order demanding duty, imposing penalty etc. The Commissioner (A) sets aside the order of the AC. Now the jurisdictional Commissioner rushes the AC to the Tribunal with an appeal and a Stay Petition. What do they gain by the Stay petition? Assuming that the Tribunal stays the order of the Commissioner (Appeals), the Revenue has no advantage as the AC's order does not bounce back to life. It has merged with the order of the Commissioner (Appeals). So, there is no order for Revenue to recover the demand originally made by the AC.
Why then, the Stay petition? A horrible waste of time, money and paper - and then they don't even know under which Section of the Act, an appeal is to be made to the Tribunal!