- (1.) THE appeal by the Revenue arises from an order of the Customs, Excise and Service Tax Appellate Tribunal dated 3 February 2014. For convenience of reference, the order is extracted herein below: - - "Waiver of pre -deposit initially granted on 12.10.2011 and extended further on 28.02.2013, has lapsed. Further extension of the stay is therefore sought. The appeal could not be disposed of on account of pendency of several older appeals for hearing. Hence stay granted on 12.10.2011 is extended to operate, during pendency of the appeals. These applications are disposed of accordingly." The Revenue in the present appeal has formulated the following questions of law: - - "1. Whether the Hon'ble CESTAT erred in granting waiver of pre -deposit of assessed demand in favour of the respondents during pendency of the appeal thereby extending the period of stay beyond 365 days ignoring the recent amendment to section 35C of the Central Excise Act, 1944, made through enactment of Finance Bill, 2013. 2. When the Hon'ble High Court Allahabad vide order dated 08.10.2013 in the case of Commissioner, Central Excise, Kanpur v. M/s. J.P. Transformers, E -21 Panki Industrial Area, Site -I, Kanpur has held that entire object and purpose of insertion of sub -section (2A) in Section 35C by Section 140 of Finance Act, 2013, will stand defeated, if the waiver of pre -deposit is granted indefinitely, the judgment in Kumar Cotton Milk Pvt. Ltd. (Supra) cannot be interpreted to give powers to the Tribunal to extend the order of waiver of pre -deposit indefinitely."
(2.) THE appeal is admitted on these questions and is by consent finally heard.
(3.) SECTION 35C(2A) of the Central Excise Act, 1944 provides as follows: - - "(2A) The Appellate Tribunal shall, where it is possible to do so, hear and decide every appeal within a period of three years from the date on which such appeal is filed: Provided that where an order of stay is made in any proceedings relating to an appeal filed under sub -section (1) of section 35B, the Appellate Tribunal shall dispose of the appeal within a period of one hundred and eighty days from the date of such order: Provided further that if such appeal is not disposed of within the period specified in the first proviso, the stay order shall, on the expiry of that period, stand vacated." In a similar case, in CC and CE v. J.P. Transformers [Central Excise Appeal No. 277 of 2013], which was decided by a Division Bench of this Court on 8 October 2013, the Division Bench referred to the decision of the Supreme Court in CC and CE v. Kumar Cotton Milk (P.) Ltd., 2005 taxmann.com 752. While considering the provisions of the second proviso to Section 35C(2A) of the Act, the Supreme Court held as follows: - - "6. The sub -section which was introduced in terrorem cannot be construed as punishing the assesses for matters which may be completely beyond their control. For example, many of the Tribunals are not constituted and it is not possible for such Tribunals to dispose of matters. Occasionally by reason of other administrative exigencies for which the assessee cannot be held liable, the stay applications are not disposed within the time specified. The reasoning of the Tribunal expressed in the impugned order and as expressed in the Larger Bench matter, namely, IPCL v. Commissioner of Central Excise, Vadodara (supra) cannot be faulted. However we should not be understood as holding that any latitude is given to the Tribunal to extend the period of stay except on good cause and only if the Tribunal is satisfied that the matter could not be heard and disposed of by reason of the fault of the Tribunal for reasons not attributable to the assessee." ;