Commissioner Of Central Excise vs. Cadila Veterinary LTD C/O Cadila Healthcare LTD

Facts

The Commissioner of Central Excise (Appellant) filed a Tax Appeal before the High Court of Gujarat against Cadila Veterinary Ltd (Opponent). The appeal was admitted on February 11, 2010, with substantial questions of law framed for determination. Subsequently, the government issued instructions dated August 22, 2019, increasing the monetary limit for filing appeals by the department. The Assistant Commissioner (Legal), Central GST, requested the withdrawal of the present tax appeal due to this revised monetary limit, which was Rs. 1 Crore for High Court appeals. The appeal was permitted to be withdrawn solely on the ground of low tax effect, without adjudicating on its merits.

Held

The Court held that the government instructions dated August 22, 2019, regarding the increase in the monetary limit for filing appeals before the High Court to Rs. 1 Crore, are applicable to the present case. Consequently, the Tax Appeal was permitted to be withdrawn on the sole ground of low tax effect, without delving into the merits of the substantial questions of law that had been previously admitted. The reasoning was based on the department's internal policy to reduce litigation by raising monetary thresholds for appeals. The ratio decidendi is that appeals can be withdrawn based on revised departmental monetary limits for litigation, provided no adjudication on merits is required. The operative direction was to permit the withdrawal of the Tax Appeal and dispose of the connected Civil Application.

Key Issues

1. Whether the revised monetary limit for filing appeals, as per government instructions dated August 22, 2019, is applicable to the present tax appeal, thereby permitting its withdrawal on the ground of low tax effect? (Question of law) The Appellant (Commissioner of Central Excise) argued that the government instructions dated August 22, 2019, which raised the monetary limit for filing appeals before the High Court to Rs. 1 Crore, are applicable. Consequently, the present appeal, likely falling below this threshold, should be withdrawn. The Appellant relied on these instructions to justify the withdrawal. The Respondent (Cadila Veterinary Ltd) did not record any specific arguments against the withdrawal based on the provided text, but the court's decision implies their acquiescence or lack of opposition to the withdrawal on the stated grounds.