WE never imagined our Tax horror-scope would be a reality in less than 24 hours. (Please see yesterday's DDT)
CBEC has issued its first Central Excise Circular on arrears recovery
during pendency of Stay applications. The circular has rescinded seven
previous circulars on the subject matter. Suddenly, the Board has
noticed a Supreme Court judgement delivered in 1993 in case of Krishna Sales (P) Ltd 2002-TIOL-428-SC-CUS wherein
the Court observed that "As is well
known, mere filing of an Appeal does not operate as a stay or suspension of the Order appealed against”. So, the Board has come to a conclusion that their predecessor Chairmen/Members did not know how to read Court Judgements and had issued some useless Circulars, which are now rescinded.Now, a fresh circular on how to deal with demands against which stay applications are pending before the Appellate forums, is issued.
known, mere filing of an Appeal does not operate as a stay or suspension of the Order appealed against”. So, the Board has come to a conclusion that their predecessor Chairmen/Members did not know how to read Court Judgements and had issued some useless Circulars, which are now rescinded.Now, a fresh circular on how to deal with demands against which stay applications are pending before the Appellate forums, is issued.
According
to the latest Circular, if a stay application is filed before the
Commissioner (Appeals) and CESTAT and if there is no stay within 30
days, recovery action has to be initiated. In case of stay applications
before High Courts and Supreme Court, even this 30 days time is not
available. Recovery has to be initiated immediately after the orders if
there is no stay.
Perhaps
the Board is not aware that there was no Bench sitting in Bangalore and
Chennai CESTAT for the last several months and even now, the Bench is
functional only for half of the month. How can they expect the CESTAT to
dispose of all the stay petitions within 30 days? There are many places
where the Commissioner (Appeals) posts are lying vacant. How can they
expect the assessees to get stay within 30 days? Perhaps the Board is
under the impression that stay orders are just like a ready-to-eat dish
which the assessee should go, pick up and come back. All that the
assessees can do is only file a Stay Petition and wait for the hearing
notice.
The
Circular issued by the Board lacks foresight, proper understanding of
the real situation and shows utter lack of respect for established
procedure and the judicial system in the country. This Circular will no
doubt create lot of work for the High Courts, as many Writ Petitions
will be filed against this atrocious Circular. Perhaps the High Courts
should award costs on the Board for issuing such mindless directions
without understanding how not to apply the Supreme Court decision of
1993 to the present situation.
When
the Board has shown extreme obedience to the Supreme Court order in
case of Krishna Sales (P) Ltd , why do they have total disregard to this
observation of the Hon'ble Supreme Court in Kumar Cotton Mills case, which is more recent compared to the 1993 order? (2005-TIOL-42-SC-CESTAT).
Is it because it just does not suit you? How can they have only
selective respect for the Supreme Court judgements? Their Lordships in
Kumar Cotton Mills observed
that:
The sub-section which was introduced in terrorem cannot be construed as punishing the assessees for matters which may be completely beyond their control. For example, many of the Tribunals are not constituted and it is not possible for such Tribunals to dispose of matters. Occasionally by reason of other administrative exigencies for which the assessee cannot be held liable, the stay application s are not disposed within the time specified.
Certainly,
this is not the way to treat the goose that lays golden eggs for the
department. They don't fill the Commissioner (Appeals) post, they don't
post Members in Tribunal and they want to punish the assessees for the
fault of babus! Is it the job of the assessees to fill the vacancies in
CESTAT, post the Commissioner (Appeals)?
The
situation in case of appeals filed in High Court / Supreme Court is
worse. The orders passed by the lower authorities will be implemented
immediately if there is no stay in operation. Does the Board expect the
High Courts and Supreme Court to dispose of the Stay applications
immediately, as directed by the Hon'ble CBEC? Are they aware of the
level of pendency in these courts?
Before
causing damage to the industry and embarrassment to itself, the Board
should immediately do proper introspection and withdraw this draconian
Circular.
No comments:
Post a Comment