By TIOL News Service

CHENNAI, APR 05, 2016: THESE appeals arise out of three sets of cases. In each case, in addition to demand against the manufacturing firms, proceedings were also initiated against individuals and brokers who issued the bills. Revenue had initially filed appeals against dropping of demands in respect of the manufacturing firms only, but later based on the advice of the Special Counsel, separate appeals were filed against the co-noticees also with a condonation of delay of 2249 days. The Tribunal refused to condone the delay. Hence revenue is in appeal before the High Court.

The main concern of the Department is that if proprietors/partners/brokers as well as those, who issued bills for selling goods, are left out, the main appeals, filed by the Department against the manufacturer, may also fail.

However, the High Court observed:

+ The concern of the Department is wholly unjustified. The partners/proprietors/brokers as well as those, who issued bills, have been slapped with a fine. The fines slapped upon them were on the basis that the manufacturer had been found guilty. Therefore, if the Department had chosen to file appeals only as against the individuals, but not against the manufacturer, such appeals would certainly fail. But, if the Department had filed main appeals against the manufacturers, but left out the individuals, the appeals filed against the manufacturers will not certainly fail on this score. Hence, the concern of the Department is actually illusory.

+ The main ground of attack to the impugned orders is that even if ultimately the Department succeeds in their appeals against the manufacturers, those orders may have to be implemented only as against partners/proprietors. Therefore, the Department feels that the appeals against the individuals should also be entertained.

+ If the Department succeeds in the main appeals as against the manufacturers, the orders can be certainly enforced against proprietors/partners. The liability of a partnership firm is that of the partners. The liability of the proprietary concern is that of the proprietor. Hence, the failure of the Department to file appeals as against the individuals, will not certainly have a bearing upon the main appeals, which were filed in time in the year 2005.

+ Therefore, the Tribunal was justified in refusing to condone the delay. No substantial question of law arises for consideration in the above appeals.

(See 2016-TIOL-674-HC-MAD-CX)