The Commissioner Of CGST And Cx, Kolkata- North Commissionerate vs. M/S. Jessop And Company Limited And Anr

Held

The High Court allowed the appeal filed by the revenue. The Court held that the Tribunal was not justified in setting aside the Order in Original solely on the ground that Rule 8(3A) of the Central Excise Rules, 2002, had been struck down by other High Courts, especially when the revenue had preferred appeals before the Supreme Court against those decisions, and a stay had been granted. The Court reasoned that the proper course of action was to await the Supreme Court's decision. Since the Tribunal had not discussed the facts of the case and had only relied on the struck-down rule, the High Court set aside the Tribunal's order and remanded the matter back to the Tribunal. The Tribunal was directed to keep the appeal pending until the decision of the Supreme Court in the appeals filed against the judgment in Indsur Global Ltd. Any interim orders granted by the Tribunal during the pendency of the appeal were to continue until the Tribunal's final disposal of the matter.

Facts

The Commissioner of CGST and CX, Kolkata-North Commissionerate (appellant/revenue) filed an appeal before the High Court against an order dated 27th November, 2019, passed by the Customs, Excise & Service Tax Appellate Tribunal (Tribunal). The Tribunal had set aside an Order in Original concerning Rule 8(3A) of the Central Excise Rules, 2002, relying on High Court decisions that struck down the said rule. The revenue argued that this issue was subjudice before the Supreme Court, with stays granted in multiple Special Leave Petitions (SLPs) against similar High Court judgments, including the one in Indsur Global Ltd. The Tribunal had not discussed the facts of the case, only noting that Rule 8(3A) was struck down.

Key Issues

1. Whether the Tribunal was justified in setting aside the Order in Original concerning Rule 8(3A) of the Central Excise Rules, 2002, when identical issues were pending before the Supreme Court with stays granted in SLPs filed by the department, specifically referencing SLP No.16523 of 2015 (Union of India Vs. Indsur Global Ltd.) and others? (Question of law turning on Rule 8(3A) of the Central Excise Rules, 2002). 2. Whether the Tribunal was justified in not maintaining status quo and keeping the matter pending until the Supreme Court's final decision on the 'ultra vires issue of Rule 8(3A) of the Central Excise Rules, 2002'? (Question of law turning on procedural propriety and Rule 8(3A) of the Central Excise Rules, 2002). 3. Whether the order passed by the Tribunal is whimsical, perverse, and without proper reasons? (Question of law). Contentions: Petitioner/Revenue: Argued that the Tribunal should have awaited the Supreme Court's decision given the stays granted in related SLPs. Respondent/Assessee: The judgment records no specific arguments from the assessee's counsel.