Tribunal not a mute spectator to patently high handed, unjust, illegal and unconstitutional action of the department
Come December and the Revenue departments lose all balance. The anxiety to collect revenue by all means, fair and otherwise, to please the political and executive bosses, has caused irreparable damage to the system. Today TIOL is full of arrears and its effects. While on this, a strong order of the Mumbai bench of the Tribunal telling the department that overanxious arrears realisation, against stay granted by the Tribunal will not be tolerated comes as a whiff of fresh air in the suffocated arrea(rs).
The brief details of the interesting case are as follows:-
The CESTAT had granted stay to the appellant and after the mandatory 180 days were over, the stay was extended for another 180 days in an order pronounced and dictated in the open court on 8.11.2004. In another case of the same assessee, the case for extension of stay was listed for 11.11.2004 and as no bench was available, the matter was adjourned to 7.12.2004.
On 30.11.2004, the Deputy Commissioner deducted the amounts demanded from a rebate claim due to them.
The party is back in the Tribunal pleading for justice. In the Tribunal, the DR asked for time to get instructions from the Commissioner. Later he informed that the Commissioner stated that “Since the appellant could not produce orders regarding stay extension by the Tribunal, the Deputy Commissioner appropriated the amount against pending rebate amount”. He further stated that the amount has already been adjusted in the Government account, no further coercive action is needed.
The Tribunal reacted sharply and in a power packed order emphatically established its own power and even suggested action against the Commissioner. The Tribunal observed that:-
• the action recovering disputed amount during the pendency of applications for extension of stay is clearly an abuse of Tribunal’s process.
• The effect of such an action is to render the stay application/application for extension infructuous.
• the Deputy Commissioner has been overzealous and hasty in his acts and his Commissioner, who has to supervise the acts of the Deputy Commissioner is not inclined to exercise his authority to overrule the appropriation orders and effect the refunds.
• The response of the Commissioner of total helplessness exhibits a lack of desire on his part to effectively supervise the subordinate or and abetment by negligence or lack of control on the subordinates from passing incorrect orders of administrative matters.
• The Commissioner is the respondent in the stay applications and is represented by the D.R. If the Commissioner is not privy to the order passed and pronounced in the open court, he has himself to blame for failure of his control on and reporting machinery. For having failed in effective supervision and break down of reporting machinery and not keeping the same in proper working order, the buck of blame has to stop at the desk of the Commissioner.
• The response of the Commissioner, as ascertained by the Bench and filed by the S.D.R. is exhibiting total callous attitude to the problem.
• the Commissioner is reluctant, at the least, to invoke his supervisory powers & jurisdiction & pursue the duty to redress the wrongs errors of his subordinates in discharge of their executive/administrative functions, leaving no option to the Bench to step in and exercise the mandate under Rule 40 of the CESTAT (Procedure) Rules to ‘take over and exercise control over the departmental authority in relation to the matter of effecting the stay ordered on recovery by this Tribunal.
• Rule 41 the CESTAT (Procedure) Rules, 1982 would clearly cover a case, of the present type, where the department takes impermissible and undue advantage of the inherent and unavoidable time gap that exists between the date when an application for extension of stay is filed and the time when the order for extension is ultimately received by both the parties. It is a fact well known, even to the department, that there is a backlog of appeals, stay applications and other applications before this Tribunal and it does take some time before an application for stay or extension of time gets listed. Even after an application is listed, it may get adjourned for any number of reasons, many a times despite the applicant’s and other concerned keenness to expedite the matter.
• If, in the meanwhile, the department exploits the situation, as they indeed have, by taking action for recovering the disputed amounts, rendering the entire application and proceedings and the standing of the CESTAT infructuous. Such an action therefore would certainly be an abuse of this Tribunal’s process. Undoing, such wrongs with a view to prevent abuse of its process are an inherent process of this Tribunal.
• If such a view is not possible, then CESTAT would become a mute spectator to patently high handed, unjust, illegal and unconstitutional action on the part of the Respondents.
• It is settled law that a petitioner in appeal or otherwise cannot suffer, because of the absence of an action on the part of the Court.
• We find this case to be a fit case to exercise the supervisory/inherent powers of this Tribunal on the officers to secure ends of justice.
• The Revenue’s contention that this Tribunal has no powers to undo the wrong committed by the department are to be rejected. As we have observed, Rule 40 & Rule 41 of the CESTAT (Procedure) Rules,1982 has been interpreted as conferring wide powers on the Tribunal to pass such orders and giving such directions as it may deem fit to prevent abuse of its process and also to secure ends of justice.
• A copy of this order be endorsed to the Chief Commissioner in charge of the Respondent Commissioner who may consider this conduct on part of the Commissioner while evaluating his Annual Confidential Report/work performance.
Is anything more required to be said? Why can’t the Government instruct that if there is stay or a stay application pending, no arrears can be realised? Is it worth having so much litigation on unrealisable arrears? Can’t the Board tell the FM that arrears are not really arrears?
See Ispat industries Ltd. v Commissioner of Central Excise, Raigad –