Suhas Chandra Sen, J. - (1.) This case arises out of a show cause notice dated 9/11/1979 requiring the petitioner M/s. Sadhana Ausadhalaya to show cause why a payment of Rs. 70,422.22 p. should not be paid by the petitioner under the Notification No. 71/78 dated 1/3/1978 as issued under the Central Excise Act. The petitioner replied to the show cause notice, The Assistant Collector of Central Excise, however, held by an order dated 2/6/1980 that the petitioner was liable to pay duty of Rs. 79,496.82 p. in terms of the aforesaid show cause notice. The petitioner preferred an appeal to the Appellate Collector who by an order dated 31/7/1981 held that: "I accept the above contentions of the appellants that for the purpose of determination of the eligibility of an assessee for the exemption under Notification No. 71/78 the clearance value of each of the items specified in the Notification is to be taken separately as provided in the Notification. Moreover, the appellants are entitled to avail the exemption under Notification No. 179/77 because they do not use power for the manufacture of Ayurvedic Medicines. I therefore, allow their appeal and set aside the order of the Assistant Collector with direction to refund the duty demanded, if already realised. This order applies to another appeal dated 17/12/1979 against Order No. V (30)17/78/68116 dated 25-10-1979 where the Assistant Collector had ordered that the appellants are not eligible for the exemption under Notification No. 71/78 dated 1/3/1978". The Excise Department went up in appeal to the Customs, Excise and Gold (Control) Appellate Tribunal which dismissed the appeal by an order dated 7th of June, 1985. The grievance of the petitioner is that neither the order passed by the Appellate Collector nor the order passed by the Tribunal has been implemented by the respondents. The Appellate Collector clearly directed the refund of the amount wrongfully collected from the petitioner to be made. But no refund has been made so far. On behalf of the respondents it has been urged that an appeal has been preferred to the Supreme Court. On behalf of the petitioner it has been pointed out that no appeal has been preferred as yet. The respondents have been repeatedly asked by a number of letters to give particulars of the appeal. The date of filing of the appeal, number of the appeal etc. have not been provided by the respondents. Even when all these letters have been annexed to the petition a very vague affidavit-in-opposition has been filed in which it has been stated. "I say that against the order of the learned Tribunal dated 7/6/1985 the department has already preferred an S.L.P. and as well as stay application and the said matter is still pending before the Hon'ble Supreme Court". The respondents have not taken the trouble to inform the court about the date of filing the Special Leave Petition in the Supreme Court or the date on which the stay application was filed. The case number has also not been given. The petitioners have contended that in the absence of the particulars they are unable to find out the details of this alleged proceeding in the Supreme Court.
(2.) In any event, the Supreme Court has not granted any stay. Mere filing of an appeal cannot operate as stay of the proceeding. Mr. Roy Choudhury on behalf of the Department has contended that so far as the assessees are concerned they have to apply for stay of the realisation of tax demanded from them before the Appellate Authority. But so far as the Government is concerned there is no provision for filing application for stay. The intention of the Legislature was that no refund should be granted until an appeal was disposed of finally by the highest court in the country,
(3.) I am unable to uphold this contention. It is well settled that an order does not cease to be operative merely because an appeal has been preferred against that order. Until the Appellate Court stays the operation of the order, the order must be implemented. Otherwise, the Government can nullify an order by merely preferring an appeal. In my view, as a proposition of law the contention of the respondents cannot be accepted. Moreover, the conduct of the respondents in this case is also deplorable. For five years they have not informed the petitioner as to the date of filing of the Special Leave Petition, nor have they informed about the date of making the application for stay for realisation of tax. The stand taken by the Department in this court is also self contradictory. On the one hand they have preferred an application for stay of realisation of tax before the Supreme Court which is pending for the last five years and on the other, they are contending that it is not necessary to obtain an order staying the operation of the orders till disposal of the appeal in the Supreme Court. I am of the view that there is no reason why general rule should not apply to a case so far as the appeal under the Central Excise Act. The operation of an order does not come to stop automatically by mere preferment of an appeal against that order.;