By TIOL News Service

MUMBAI, JAN 12, 2015: THIS is an appeal filed by the Commissioner of Customs (General) before the Bombay High Court against an order passed by the CESTAT allowing the Appeal of the Respondent. The Tribunal's order set aside the order-in-original, by which, the Customs House Agent Licence of the Respondent was revoked and security deposit made by it was forfeited.

As the Tribunal's order was not implemented the respondent had filed a Miscellaneous application and the CESTAT had passed an order on 8th September, 2014 directing restoration of the Customs House Agent Licence and also mentioning that if the same is not complied with, the Tribunal intends to initiate contempt of Court proceedings.

Before the High Court the counsel for the Revenue submits that neither the Revenue nor its officers are at fault. Inasmuch as the Revenue had filed Appeals to the High Court and the Appeals though registered were not heard for admission not because of any fault of the officers or the Advocates but because of pressure of work on the Court; that the Tribunal should not have passed such an order visiting the Revenue with contempt proceedings for failure to implement it.

The High Court observed that the Revenue Appeal raises substantial questions of law and, therefore, the same was admitted.

On the request made by the counsel for the Revenue that the order passed on 31st July, 2013 by the Tribunal be stayed as the present Appeal is admitted, the High Court observed that it was not inclined to grant the stay of the order of the Tribunal as the Tribunal had allowed the Appeal of the Respondent.

The High Court further observed –

++ The Tribunal's findings raised substantial questions of law. A particular finding or an observation based on understanding of the Tribunal of a provision of law must not visit the party like the Respondent with adverse consequences. The Tribunal's order can be given effect to subject to the pending Appeal by the Revenue in such cases. Ordinarily, this would not require any application before the Tribunal or before this Court.

++ In the given facts and circumstances, we direct that the licence of the Respondent Agency be restored subject to the outcome of the instant Appeal . The restoration will not prejudice the rights of the Revenue in this Appeal.

Nonetheless the High Court had the following views on the order passed by the CESTAT in the matter of the Miscellaneous application filed by the respondent -

++ Bearing in mind the peculiar and procedural formalities required to be complied with before this Court can take the Appeals of the Revenue for admission, ordinarily the Tribunal should not pass drastic orders as have been passed in the present Miscellaneous Application. The Tribunal proceeded on the footing that there is deliberate non-compliance or defiance of the order passed in the main Appeal. It should not pass a blanket order on a Miscellaneous Application of the aggrieved Customs House Agent and in every case. There cannot be a general rule that the order passed by the Tribunal must be implemented. As the Revenue has right to Appeal to this Court, equally, it has further right to request this Court for grant of stay of the order appealed against. The Tribunal cannot defeat or frustrate the right of the Revenue or the litigation itself. In these circumstances, we would expect the Tribunal not to undertake such an exercise and as a matter of routine. It should decide on case to case basis and the Revenue should get opportunity to seek a stay of implementation of the orders. The Tribunal should not therefore, as a matter of course, pass orders as have been passed on the Miscellaneous Application. We would expect that this much will suffice the purpose of both, the Revenue and the Tribunal.

The Motion filed by the Revenue for interim relief was dismissed with the aforesaid observation.

(See 2015-TIOL-83-HC-MUM-CUS)