CX - Officers should inculcate in them a habit of following and implementing binding Division Bench judgments - If they are reluctant, Court would visit them with individual penalties, including forfeiture of their salaries until they take a corrective action: HC
By TIOL News Service
MUMBAI, APR 01, 2016: AN order-in-original dated 31st January, 2012, was passed by the Commissioner demanding a sum of Rs.32,39,35,223/- with interest under Rule 6(3) of the CCR, 2004, for alleged use of common input services in the manufacture of exempted goods.
An appeal was filed against this order.The CESTAT had ordered a pre-deposit of Rs.50 lakhs for granting stay.
Incidentally, the petitioners have been exporting various engineering equipment and machinery and claiming rebate on payment of appropriate duty.
The Assistant Commissioner by an order dated 29.01.2016 while sanctioning the rebate appropriated the same against the duty demand.
On an earlier occasion, in similar circumstances, the Bombay High Court had on 22.02.2016 while quashing & setting aside the order observed [See 2016-TIOL-470-HC-MUM-CX ] -
"20. Before us the Revenue had passed an original order. That confirmed a certain demand. That order was challenged in Appeal before the Tribunal and to the extent the Petitioner disputed the demand, there was a stay in favour of the Petitioner before us, as also the condition of pre-deposit was waived. Such an order passed in the presence of both sides including the Revenue could have been assailed by the Revenue by appropriate legal proceedings. However, the Revenue could not have got over a binding stay order and by indirect or oblique process seek to recover the very sum and amount which it could not recover because of the prohibitory order of the Tribunal. Once no recovery of taxes pending Appeal was permissible and there was a stay to that extent, then, the Revenue could not have ignored this binding order of the Tribunal. This is a novel way of taking over the adjudication and recommencing it when the earlier exercise ended completely in an order favourable to the Revenue but subject matter of Appeal. This is a clear case where the principle of matter being sub-judice would apply.
22. The impugned order, passed in the present Petition and the observations in paragraph 10 cannot be utilized and to nullify, therefore, an order of stay which binds the Revenue. The powers if at all available could not have been exercised in this case and to subvert the order of stay and the Appeal which is pending,as a whole. This novel way of adjudication and mid-way during the pendency of legal proceedings before higher forum enables us to interfere in our writ jurisdiction."
Against the rebate claim order dated 29.01.2016, the petitioner is before the High Court and submits that what the Assistant Commissioner could not do directly, he achieved it indirectly by appropriating or adjusting the amount of the demand originally confirmed but stayed by the Tribunal. And that the issue in the present petition is identical and stands covered in favour of the petitioner by the judgment dated 22.02.2016 (supra).
The High Court observed that there being no distinguishing feature vis-à-vis the earlier order, the impugned order dated 29.01.2016 is quashed and set aside.
Nonetheless, the High Court after noting that the order dated 22.02.2016 (supra) was delivered much after the impugned order made the following scathing observations -
++ We expected the officers to save precious time of this Court in not requiring it to pass a detailed order and judgment.
++ We find that officers after officers are reluctant to take decisions for the consequences might be drastic for them. No officer is acting independently and following judgments of this Court, but waiting for the superiors to give them a nod.
++ Even the superiors are reluctant given the status of the assessee and the quantum of the demand or the refund claim.
++ We are sure that some day we would be required to step in and order action against such officers who refuse to comply with the Court judgments and which are binding on them as they fear drastic consequences or unless their superiors have given them the green signal.
++ If there is such reluctance, then, we do not find any enthusiasm much less encouragement for business entities to do business in India or with Indian business entitles. Such negative reactions / responses hurt eventually the National pride and image.
++ It is time that the officers inculcate in them a habit of following and implementing judicial orders which bind them and unmindful of the response of their superiors. That would generate the right support from all, including those who come forward to pay taxes and sometimes voluntarily.
++ Hereafter, if such orders are not withdrawn despite binding Division Bench judgments of this Court that would visit the officials with individual penalties, including forfeiture of their salaries until they take a corrective action.
++ If any approval or nod is required from superiors that should also be granted expeditiously and while obeying the court orders, the officers can always reserve the Revenue's rights to challenge them in appropriate legal proceedings.
The High Court also directed that a copy of the order be sent to the Secretary in the Ministry of Finance, Government of India and the Chairman, Central Board of Excise and Customs.
The Writ Petition was disposed of.
(See 2016-TIOL-639-HC-MUM-CX)
