T K Jayaraman's posting at Bangalore rectified after 5 years

Govt. losing 4000-4500 crores every year at CESTAT
DRI & Central Excise Intelligence cases worst hit

The new President of the CESTAT, Hon'ble Mr. Justice R.M.S. Khandeparkar has shown courage to initiate administrative and judicial reforms in the CESTAT against all hopes. Many of the constituents of the CESTAT wield such an influence that it is practically impossible to undertake any reform as the cartel operating at CESTAT is so strong that many a time even the administration is helpless. Without the involvement of CBI this cartel cannot be broken because tonnes of money is involved. A sum of Rs. 300-350 crores is stated to be changing hands every year causing blockage/loss of revenue of Rs. 4000-4500 crores annually. The revenue is suffering worst at Ahmedabad and Bangalore . At Ahmedabad one of the Departmental Representative is learnt to be famous for winning more cases for the assessee than for the Revenue Department.

The authorities should wake up from slumber and initiate prompt action, was the command of the Hon'ble Supreme Court to Ministry of Finance when last time we brought the happenings in the CESTAT, to the kind notice of the Hon'ble Supreme Court [See R.K. Jain v. Union of India - 1993 (65) E.L.T. 305 (S.C.) = (2002-TIOL-405-SC-CB). It seems time is ripe for another introspection and consequential action to bring the situation at CESTAT under control and to protect the interest of public revenue. The Hon'ble President of CESTAT is trying single handedly to save the CESTAT. It is imperative that all honest forces in the CESTAT unite and strengthen the hands of the President.

It is an open secret that inspite of the transfer policy for CESTAT personnel providing for maximum stay of 5 years at a station, still many of them served their entire period of service at one station or when they are transferred even after 8-10 years or from places where they managed to get themselves posted in violation of the transfer policy, still they show resentment by their strongly worded representations for retention.

“Annual Transfers” introduced :

When Justice R.M.S. Khandeparkar took over as President, CESTAT, we carried the news in 2009 (235) E.L.T. A148, emphasizing the need for annual transfers in May/June every year before the new academic session so as to implement the transfer policy which was formulated in 1994 on the recommendation of CEGAT Enquiry Committee [See 1994 (73) E.L.T. A3] and reaffirmed by the Ministry of Finance vide Deptt. of Revenue Office Order No. 2/2006.

This year, for the first time, the system of annual transfer of Members has been introduced in the CESTAT by Justice R.M.S. Khandeparkar. In this first ever annual transfers in the CESTAT, Shri T.K. Jayaraman, Member (Technical) has been transferred from Bangalore Bench to Kolkata Bench, Dr. C. Satapathy, Member (Technical) from Kolkata Bench to Chennai Bench and Shri P. Karthikeyan, Member (Technical) from Chennai Bench to Bangalore Bench.

Number of Members of the CESTAT were transferred last year in Oct. 2008 by the then President Justice S.N. Jha, consequent upon large-scale complaints. At that time also almost all such Members represented against their transfer, even though their posting or continuation at the respective station was in utter violation of, and disregard to the declared transfer policy and public interest.

Shri P. Karthikeyan, Member (Technical) is learnt to have represented that he may not be transferred to Delhi or Mumbai because of certain personal difficulties which the Hon'ble President is learnt to have acceded to resulting in his transfer to Bangalore . Dr. C. Satapathy was initially tipped for transfer to Mumbai where there is only one Technical Member, who is also retiring in September this year. It seems that to liquidate the highest pendency at CESTAT Chennai, Dr. C. Satapathy has been posted there as he is known as ‘Fast Track Judge' and he has already proved his mettle at CESTAT Kolkata, where he has almost liquidated the pendency. It is reliably learnt that Shri T.K. Jayaraman has represented against his transfer from Bangalore to Kolkata on various technical and other grounds.

Appointment & posting of Shri T.K. Jayaraman — Validity :

Shri T.K. Jayaraman had three consecutive postings at Bangalore since 2002. Initially, in June, 2002 he was posted as a Commissioner of Central Excise, Bangalore by Board's Office Order No. 82/2002, dated 12-6-2002. Subsequently, in the year 2003, he was appointed as Commissioner of Central Excise (Appeals), Bangalore and in September, 2004, he was appointed as Member (Technical) at CESTAT, Bangalore . Therefore he has been posted in Bangalore continuously for the last 7 years.

The appointment of Shri T.K. Jayaraman to the CESTAT itself is stated as not beyond the pale of challenge, in as much as his application for the post of Member (Technical) in the CESTAT is learnt to have been received by the designated authority much after the cut-off date prescribed for receipt of applications. Thus, his application should have been summarily rejected. But due to secrecy surrounding in the matter of appointments to the CESTAT, all irregularities are covered up and the favoritism of the administration has gone unchecked.

Even the initial posting of Shri T.K. Jayaraman at CESTAT Bangalore was in violation of policy on transfers and postings as well as against public interest.

Clause (a) of the guidelines issued in this respect under M.F. (D.R.) Office Order No. 2/2006 is as under :-

(a) A Member, save and except for sufficient and cogent reasons, shall not be posted at a place where he had held a judicial office or any office of the Union/State or had been practising as an Advocate, as the case may be.

According to these guidelines any Member of CESTAT shall not be posted at a place where he had held any office of the Union/State. Since Shri T.K. Jayaraman at the time of his appointment and posting to CESTAT Bangalore, was serving as Commissioner of C.E. (Appeals), Bangalore , therefore his posting at Bangalore was in violation of the Government policy. The present transfer of Mr. Jayaraman underlines the commitment of the new leadership not just to adhere to norms but also to correct certain blunders of the past.

Appellate authority against own orders :

To accommodate Shri T.K. Jayaraman at Bangalore , Shri K.C. Mamgain, Member (Technical) was transferred from Bangalore to Delhi in less than one year of his posting at Bangalore . Posting of Shri T.K. Jayaraman at Bangalore Bench was against all norms and propriety. He was made appellate authority against his own orders passed as Commissioner of C.E., Bangalore and Commissioner of C.E. (Appeals), Bangalore . Because of this, all appeals filed at CESTAT, Bangalore against his orders had to be transferred and heard at CESTAT, Chennai, causing harassment, inconvenience and expenditure to large number of assessees and their Counsels, as they were made to travel from Bangalore to Chennai merely to accommodate Shri Jayaraman at Bangalore. Thus his posting at Bangalore was against the established practice and norms, as well as public interest, rather it was in the interest of an individual. Shri T.K. Jayaraman is a close relative of a former Chairman of CBEC and former President of CESTAT and the administration seems to be very magnanimous towards him.

Tribunal acting more loyal than the king — Abuse and misuse of powers :

Several orders of the Division Bench of Shri T.K. Jayaraman came under the watchful eyes of Hon'ble High Courts particularly of Karnataka High Court. Comments bordering on strictures were passed in many cases. Severest of the strictures on any Bench of the CESTAT by any High Court were passed, on the Division Bench order authored by Shri T.K. Jayaraman, in the case of Commissioner v. McDowell & Co. Ltd. [2005 (186) E.L.T. 145 (Kar.) = (2005-TIOL-72-HC-KAR) . In this case an amount of Rs. 99 crores was involved and CESTAT Bangalore had earlier ordered deposit of Rs. 25 crores as condition for waiver of pre-deposit of balance amount. However, subsequently CESTAT Bangalore modified its own order and waived even this condition for deposit of Rs. 25 crores [2005 (182) E.L.T. 114 (Tri. - Bang.) = (2005-TIOL-324-CESTAT-BANG).

The Karnataka High Court was shocked and appalled at the manner in which the CESTAT Bench modified its own order and was compelled to even state in relation to Division Bench Order authored by Shri T.K. Jayaraman that the assessee had managed to obtain the order and it is a clear case of abuse and misuse of powers by the Tribunal . The Hon'ble Karnataka High Court in specific words held as under :-

“....The order is totally lacking in conforming to the requirement of Section 35F of the Act. … The argument of non-interference with an order passed by the Tribunal with jurisdiction is called in aid only to safeguard and protect the order which the assessee has managed to obtain before the Tribunal. ..... An order which cannot speak for itself, an order which has not taken into consideration all relevant aspects, particularly, the statutory requirements of the proviso to Section 35F of the Act, in my view is an order that is not at all sustainable. It is a clear case of abuse and misuse of the powers under the proviso to Section 35F of the Act.”

[Emphasis supplied]

The High Court was compelled to comment that the CESTAT, Bangalore granted relief to the assessee on a ground which was not even pleaded by him. In strong words the High Court observed that the Tribunal was acting more loyal than the King in the following words :-

“........ The effect of this order is that the Tribunal has dispensed with the requirement of pre-deposit of total duty amount of Rs. 64 crores as also the penalty amount of Rs. 35 crores without showing any awareness as to the existence of any undue hardship to the assessee if the assessee is required to comply with the provisions of Section 35F and the proviso and in total disregard of the interest of the revenue by not providing sufficient safeguard. In fact, while in the earlier order, it is held that the appellant has not even pleaded any financial hardship, in the present order, nothing is mentioned at all. Here is a typical case of the Tribunal acting more loyal than the King!”

[Emphasis supplied]

Under the garb of modification, the CESTAT Bench waived the entire pre-deposit of around Rs. 99 Crores even when the interim order passed before had held that the appellant did not have prima facie case and had suppressed information from the Department and the same Bench of Tribunal ordered part pre-deposit of Rs. 25 crores as a condition of stay of Rs. 99 crores and it was done when the Tribunal has no powers to review its own order. The High Court took note of such infirmities and held that -

“…the order is woefully lacking in the Tribunal having not exhibited its awareness to the requirements of proviso of Section 35F of the Act. It is also clear that the Tribunal after having exercised jurisdiction for the purposes of passing an order for waiver of pre-deposit under the proviso to Section 35F of the Act cannot modify that order subsequently like an appellate authority, nor can keep tinkering with the order as and when applications for modification of the order are filed.”

[Emphasis supplied]

The CESTAT, Bangalore Bench in the case of Rishi Polymach Ltd. v. Commissioner [2005 (192) E.L.T. 884 (Tri. - Bang.)] allowed appeals by assessee and extended Cenvat credit to the tune of Rs. 31 lakhs based on supplementary balance sheet produced. The Hon'ble Karnataka High Court [2008 (232) E.L.T. 201 (Kar.)] did not approve the Division Bench order authored by Shri T.K. Jayaraman and held that acceptance of supplementary balance sheet by the Tribunal was a grave error. It held -

“10. Without assigning any reason, the Tribunal has accepted the supplementary balance sheet, which according to us, the Tribunal has committed a grave error in allowing the appeal by accepting the supplementary balance sheet.”

11. When the supplementary balance sheet is relied upon by the respondents, it is for them to show that the goods received were actually received and utilised in manufacturing the finished products. The Tribunal has wrongly placed the burden of proof on the appellant instead of placing it on the respondents. ”

[Emphasis supplied]

Pre-deposit of Rs. 320 crores waived for deposit of Rs. 1 crore— Case heard without being listed :

In the case of Harsinghar Gutka Pvt. Ltd. v. Commissioner [2008 (221) E.L.T. 77 (Tri. - Del. )], the CESTAT Division Bench comprising of S/Shri S.S. Kang and T.K. Jayaraman granted a waiver of pre-deposit of Rs. 320 crores against deposit of just Rs. 1 crore only. This order of waiver of pre-deposit was also authored by Shri T.K. Jayaraman, Member (Technical) and related to the clandestine removal of gutka. The various dimensions of the case and ramifications of the order were highlighted in our editorial “ Battle for Rs. 320 Crores - Mysterious recusal by CESTAT Member - New Bench orders pre-deposit of Rs. 1 Crore ” [2008 (229) E.L.T. A153].

The order of waiver of pre-deposit of Rs. 320 crores passed in this case has been challenged by the Commissioner of Central Excise, Lucknow before the Allahabad High Court. The most important aspect of this case is that it was heard and the Stay Order of Rs. 320 crores was passed on a day when the case was not even listed in the cause list. The CEGAT Enquiry Committee had recommended that in such cases, the Members concerned should be made personally responsible and this recommendation has already been accepted by the Government. In view of this, the President, CESTAT is expected to initiate action against the erring Members.

Tribunal persistently ignoring statutory provisions and High Court rulings :

Coming back to the Hon'ble Karnataka High Court, within whose jurisdiction the Bangalore Bench of the CESTAT, is functioning, the High Court in the case of Commissioner v. United Telecom Ltd [2006 (198) E.L.T. 12 (Kar.)], = (2006-TIOL-419-HC-KAR-CUS) while considering the validity of the full waiver of pre-deposit granted by the Bangalore Bench of the CESTAT [2005 (191) E.L.T. 1056], which included Shri T.K. Jayaraman, Member (Technical) commented upon the routine manner in which waiver of pre-deposit are being granted.

The High Court also commented upon the statutory responsibility of the CESTAT to safeguard the interest of the revenue, while granting waiver of pre-deposit and observed as under :

“It is not the lip sympathy of the Tribunal which can fulfil the statutory requirement of ensuring the safeguard of the interest of the revenue, but a concrete order indicating the manner in which the interest of the revenue is in fact safeguarded by imposing commensurate conditions.”

The High Court finally held that the Tribunal's order in this case was clearly in violation of statute and fit to be characterized as arbitrary even while drawing reference to its own observations in McDowell case supra as under :-

“In the present case it is not even the case of the appellant before the Tribunal that it faces any financial hardship or has any difficulty in this regard. Even in the absence of any plea from the appellant before the Tribunal to this effect, the tribunal ventures upon to grant total waiver of pre-deposit. It is undoubtedly yet another instance of as observed by this court in the case of McDowell & Company [supra] the Tribunal being more loyal than the king. It is rather surprising that the Tribunal persists in ignoring the statutory provisions as contained in the proviso to Section 129E in passing such order for the purpose of pre-deposit when the order is passed only under this proviso and not under any other provision. The impugned order is clearly a violation of the statute, fit to be characterized as arbitrary inasmuch as the Tribunal has not shown its awareness to the aspect of undue hardship if in fact existed or will be caused to the assessee if the assessee has to fulfil the statutory requirement of pre-deposit…”

[Emphasis supplied]

Pre-deposit of Rs. 440 crores waived without any financial hardship— High Court rulings again violated :

The Bangalore Bench of the CESTAT comprising of Dr. S.L. Peeran, Member (J) and Shri T.K. Jayaraman, Member (T) in the case of Bharti Airtel Ltd. v. Commissioner of Customs [2009 (237) E.L.T. 469] = (2009-TIOL-654-CESTAT-BANG) has waived the pre-deposit of the entire amount of Rs. 440 crores on the ground that the appellant has strong prima facie case. In this case, the order of waiver has been authored by Shri T.K. Jayaraman, but it does not contain any reference to any financial hardship either pleaded or considered by the Bench. Surprisingly this order is very sketchy and observations, discussion and decision of the Bench are in just 11 printed lines while the case involved more than Rs. 440 crores.

The Karnataka High Court has repeatedly held in the cases of McDowell & Co. Ltd and United Telecom Ltd that it is the statutory obligation of the CESTAT to safeguard the interest of the revenue and therefore, unless the assessee pleads financial hardship with regard to the compliance with pre-deposit and the assessee is unable to make pre-deposit, it cannot be said that assessee is facing financial hardship warranting dispensation of pre-deposit. The order passed in the case of Bharati Airtel Ltd. by the Bangalore Bench is not only in violation of the dictum of the Karnataka High Court, but also contemptuous as the Bangalore Bench of the CESTAT is refusing to follow the law laid down by the Karnataka High Court, which is the jurisdictional High Court for CESTAT, Bangalore.

Asked for “three” got “thirteen” :

Recently, the Central Excise Department, Mangalore has filed an appeal against the order passed by the Bangalore Bench of the CESTAT, again comprising of Dr. S.L. Peeran, Member (J) and Shri T.K. Jayaraman, Member (T) in the case of Alvares & Thomas [2009 (13) S.T.R. 516] = (2008-TIOL-2289-CESTAT-BANG) on the plea that the assessee has preferred the appeal to the Tribunal only on the question of limitation, whereas the Tribunal has decided the appeal in favour of the assessee on merits. The Hon'ble Bench of the Supreme Court comprising of Hon'ble Mr. Justice S.H. Kapadia and Hon'ble Mr. Justice Aftab Alam in Civil Appeal D. No. 5566 of 2009, passed the following order on 27-04-2009 :

“Delay condoned.

Issue notice to the extent mentioned below.

Since the assessee had preferred an appeal before the Tribunal only on the question of limitation, we do not see any reason why the Tribunal has decided the assessee's appeal on the merits of the case.”

[Emphasis supplied]

Kerala High Court also dissatisfied with Bangalore Bench Orders :

In the case of Electronic Control Corporation v. Commissioner [2009 (235) E.L.T. 417 (Ker.)], the Kerala High Court too has recorded its annoyance with the order of the CESTAT Bangalore as reported in [2006 (197) E.L.T. 291 (Tri. - Bang.)]. In this case also, the order for the Bench was authored by Shri T.K. Jayaraman, Member (T) and as per the Kerala High Court, the CESTAT did not consider the evidences relied on by the Department and burden of proof was held as not discharged by the Department. The High Court expressed its “thorough displeasure” in its order in the following words -

“Since we are thoroughly dissatisfied with the order of the Tribunal which was issued without reference to the materials gathered by the department and based on which adjudication was made, we set aside the order of the Tribunal with direction to the Tribunal to rehear the matter…”

[Emphasis supplied]

The High Court expressed surprise over the Tribunal order by holding that -

“Strangely, the Tribunal has not considered any evidence relied on by the department like the statements recorded from the employees, admission made by the proprietrix at the time of search and the evidence collected from the Bank pertaining to business transactions. When prima facie evidence is established by the department, particularly with reference to banking transactions, it is for the respondent-assessee to explain why the transactions should not be treated as pertaining to business. The Tribunal failed to note that reasonable inferences can be drawn from evidence collected by the department, more so when the respondent fails to explain the transactions brought on record. Strangely, the employees statements which have evidentiary value have been ignored by the Tribunal.”

[Emphasis supplied]

Over-ruling the order of the CESTAT, Bangalore Bench in the case of Midas Pre-cured Tread Pvt. Ltd. v. Commissioner [2006 (200) E.L.T. 423 (Tri. - Bang.)] = (2006-TIOL-1150-CESTAT-BANG), the Kerala High Court in 2009 (236) E.L.T. 26 (Ker.) held that the Tribunal, instead of considering scope of notifications with reference to statutory provisions, under which such notifications are issued, considered the scope of statutory provisions with reference to notifications issued. The Court held that -

“We do not know on what basis the Tribunal has held that prospectivity has no relevance in this case…the Tribunal or even the High Courts have no power to grant retrospectivity for a notification in the interpretation process.”

In this case also the order of Bangalore Bench of CESTAT was authored by Shri T.K. Jayaraman.

The repeated adverse comments by the Karnataka High Court and the Kerala High Court on the Division Bench orders authored by Shri T.K. Jayaraman, Member (T), CESTAT, Bangalore need to be looked into by the administration. Remedial measures are required to be taken to safeguard the public revenue and also to maintain judicial discipline which is one of the basic requirements. If the jurisdictional superior court feels and records that the Tribunal persists in ignoring the statutory requirements inspite of its rulings, it is a clear case of gross judicial indiscipline and needs action.

CESTAT Registry inviting action :

It is said that a successful lawyer, must not only know the law but also the judge, but for success in the CESTAT, one must know the Registry than anything else. Because CESTAT Registry provides indispensable assistance in choosing the Bench, desired listing of cases, not listing of the cases even though fixed for hearing, providing instant copies of the orders, acceptance of defective appeals, listing of cases out of turn and out of sequence, separate listing of cross appeals against common orders so that departments appeal becomes infructuous, if assessees appeal is heard alone and allowed, listing of part heard matters of one Court before another Court and listing of Excise matter before the Customs Bench and Customs matters before the Excise Bench, this list of services is endless.

Officers of the Registry are so bold that they even placed a part heard matter of the President's Court in another Court. Not only this there is an instance where a part heard matter of President's court was simultaneously listed before President's court as well as before other court on same day and appeal files were sent to the other court rather than to President's court. It requires great courage to list a particular part heard matter simultaneously before two Courts. This shows that the Registry is not even scared of tinkering with the cases listed before the Hon'ble President either in the past or even now, because they have a ‘NO ACTION' warranty in their mind due to the support of the cartel to which we have referred in the earlier part of this editorial.

To rationalize the working of the CESTAT Registry, number of administrative and judicial reforms are required. They include, codification of all circulars/instructions, updation of CESTAT Judicial Manual, compilation of CESTAT Administrative Manual and then strict compliance with the procedures and prescriptions made in these Manuals, creation of the post of Registrar General and making it equivalent to the post of District Judge and complete computerization of the CESTAT.

The main reason attributed to the malfunctioning of the CESTAT Registry is the long stay of some of the Registry personnel at same station enabling them to cultivate deep contacts with the local personnel and providing opportunity to misuse the office for personal gain. The policy of annual transfer should also be introduced for Assistant Registrars/Deputy Registrars and they should also be rotated to different stations atleast every 3-5 year. Without this no reform in the CESTAT can yield results.

Larger Benches Revoked :

In the news item carried by us on the joining of new President, Justice R.M.S. Khandeparkar, we stated that constitution of too many Larger Benches is not conducive to the working of the Tribunal. We stated so because the institution of Larger Bench has lost its sanctity due to the casual manner in which the reference to the Larger Benches were being made and constituted even at stations where only two Members are posted and the third or more Members have to be drawn from other Benches dislodging the work of the Regular Benches.

There seems to be a scheme of things that whenever the Revenue Department goes in appeal to the High Court or the Supreme Court on an important issue decided in favour of the assessee, the same issue gets referred to a Larger Bench and before the decision of the High Court or the Supreme Court, decision of the Larger Bench is reached and then presented before the High Court/Supreme Court as a considered view of the Tribunal on the issue in question. This trend started way back in 2000 from the case of Luminous Electronics Pvt. Ltd v. Commissioner of Central Excise - Stay Order No. 1/2001-B, dated 3-1-2001, wherein a decision of a Larger Bench of 3 Members was stated to be controversial by the Division Bench of two Members and thereafter, it was directly referred to the Larger Bench of 5 Members without assigning any reason or discussing any controversy. No reasons or grounds or the basis, whatsoever were recorded or contained in the referral order which read as under :-

STAY ORDER NO. 1/2001-B, DATED 3-1-2001

“The short question that arises for consideration in this appeal is the classification of Uninterrupted Power Supply System (UPSS). Party wanted to have it classified under Tariff sub-heading 8504.00, while the Revenue classified it as coming under sub-heading 8543.00. Consequently, the appellant has been directed to pay a sum of Rs. 3,78,598.00 towards duty.

2. Along with the appeal, appellant has prayed for waiver of pre-deposit as contemplated by Section 35F of the Central Excise Act, 1944. On hearing counsel representing the appellant, it appears that the issue regarding the classification, even though covered by a larger Bench decision of three Members of this Tribunal in Tata Liberty Ltd. v. C.C.E., Mumbai. - 1993 (35) RLT 933 still continues to be not beyond controversy.

Learned counsel representing the appellant further submitted that in cases where assessments were made following the decision of the larger Bench of this Tribunal, High Courts have directed the department to realize 50% of the duty assessed thereon as an interim measure. In these circumstances, we direct the appellant to deposit 50% of the amount claimed by way of duty, namely, 50% of Rs. 3, 78,598.00 within a period of one week from today as a condition precedent for entertaining the appeal as per the provisions contained in Section 35F of the Act. On the deposit being made as stated above, appeal will be posted before a larger Bench of five Members. For reporting compliance of deposit posted on 15-1-2001.

Pronounced and dictated in the open court.

[Emphasis supplied]

The opening sentence of this order records that a “short question” arises for consideration in this appeal and this “short question” was already decided by a Larger Bench of 3 Members in 1993 (35) RLT 933. In these circumstances where was the scope or requirement for referring this “short question” to still Larger Bench of 5 Members. The order of the Division Bench is silent on this aspect.

In recent years, majority of the Larger Bench decisions have gone in favour of the assessee and this is a matter which needs to be gone into by the administration to see whether the Larger Benches have not been used to curb the independence of the regular Division Benches for drawing benefit in favour of the assessee on the strength of Larger Bench decisions. There is another disturbing feature, majority of the Larger Benches have been constituted in matters relating to a particular group of lawyers who after having an order in favour of their client, still agree for reconsideration of issue already decided in that order. There seems to be wheels within the wheels so far as the reference to, and constitution of Larger Benches are concerned. Therefore the matter needs detailed analysis which we intent to take up in a separate write up.

The new President, Mr. Justice R.M.S. Khandeparkar by CESTAT Order No. 1/2009, dated 15-04-2009 has revoked all pending Larger Benches except wherein hearings have been concluded and matters have been fixed for orders, putting a curtain over the various infirmities and controversies relating to the
Larger Benches in the past.

“Reserved Order” to be released in 4 months :

The other reform that has been introduced by the new President is about expediting the pronouncement of order after hearing. The President by CESTAT Order No. 2 of 2009, dated 25-5-2009, has directed that where there is delay of more than 4 months in delivery/pronouncement of orders from the date of con­clusion of hearing in any appeal or application, the matter shall be considered as “Not Heard”. Such appeals and applications will have to be listed for fresh hear­ing after obtaining prior written consent from the President. There have been number of high stake cases in the CESTAT, in which orders had been pending for months together after hearings including the case of Bharti Airtel Ltd . (Appeal Nos. C/573-75/2008), involving an amount of nearly Rs. 440 crores, where CESTAT Bangalore Bench reserved orders on 16-1-2009 after final hearing. [See Stay Order in 2009 (237) E.L.T. 469 (Tri.-Bang.)].

This order of the President CESTAT shall cut delay in pronouncement of reserved orders as well as create accountability for the delay since for relisting of the matter for fresh hearing, prior written consent of the President is required to be obtained. The detailed guidelines regarding the period within which reserved orders are to be pronounced, seems to be in the pipeline as the present order of the President is only an ad hoc arrangement.

The other area which needs the attention of the Hon'ble President is that reserved orders are not listed in the cause list for “pronouncement of judgments” and even where it is listed, the Cause List is issued just 15 to 20 minutes before the pronouncement thereby leaving no scope for the concerned persons to be present at the time of pronouncement. Such Cause List needs to be issued atleast a day before giving 24 hours time between issue of Cause List and pronouncement of judgment. In this regard the procedures prescribed in paras 6, 7 and 8 of the CEGAT Office Order No. 2/1995 are required to be adhered to.

Conclusion :

E.L.T. has been relentlessly campaigning for reforms and action and it seems with the joining of Justice R.M.S. Khandeparkar as President of the CESTAT there is now light at the end of the tunnel. The irregularities, controversies and glaring issues which were begging for attention and action have been noticed by the President and his commitment to set in motion the purging process is visible. The well-intentioned work should not go unacknowledged. This editorial is a result of such feelings as also to highlight the pending agenda which is stupendous but not insurmountable. It seems that attempts to change the direction of things in the CESTAT has began and it prompts us to retain our hopes for improvement in the existing scheme of things, as the dawn to come will bring the rays of reforms to dispel the darkness.