CBEC Instruction No. F.No.275/30/2014-CX.8A, Dated – 3rd April, 2014

Subject:- Improving the departmental representation in High Court/CESTAT-reg.

I am directed to invite attention to the Interim Order No. IO/E/795-802/2013-EX(DB), dated 18-12-2013 of the Principal Bench of CESTAT, New Delhi. Vide para 9 of the said order dated 18-12-2013 the bench observed “it is high time for revenue to rise to the occasion and reduce its litigation without burdening the Tribunal to list the matters frequently in cause list to know status of compliance to stay orders. Aforesaid scenario exhibits laxity of the Commissioners to pursue the litigations before the High Courts. Therefore we direct the Registrar to send a copy of this order expeditiously to the Revenue Secretary, Ministry of Finance for appropriate action so that Revenue shall be litigation free and its blocked revenue shall be realized as early as possible”.

2. The aforesaid observations were made by the Bench in the context of various orders of pre-deposit made by it as per table below, and the failure of the department to ensure the compliance of the same, when the matter was posted on 18-12-2013.


S. No. Appeal No. Order of Tribunal on stay application Order of High Court Remarks of the Tribunal
1. E/2665/2008 Pre-deposit of Rs. 7.5 lakhs ordered on 15-1-2013 Dated 21-3-2013 in CA 33/13 High Court while directing the Tribunal not to dismiss the appeal for non-compliance, the department was directed to file the Counter, which it had not done on time.
2. E/314/2010 29-1-2010 Matter still pending in High Court vide Misc Single No. 224/2011.
3. E/2238/2010 Pre-deposit of Rs 55 lakhs ordered on 23-8-2012 Dated 25-7-2013 in CA No. 43/2013 High Court ordered deposit of 50% of the duty amount without specifying any time period for deposit. Although the appellant admitted the liability as Rs. 30 lakh, only Rs. 21 lakh had been deposited. Revenue is causal in the matter.
4. E/593/2011 Stay granted in respect of penalty amount only on 23-3-2012, whereas no stay was given in respect of duty demand of Rs 4,40,72,632. Dated 26-11-2012 in CEXA No. 2/2012 The High Court has stayed recovery on undertaking to be given by the appellant through its Counsel that it will pay the demand due in case of losing its case. Revenue not able to give latest status of the case.
5. E/55166/2013 Pre-deposit of 50% of duty element ordered on 14-3-2013 Dated 1-5-2013 in CA No. 76/2013 The High Court ordered that the Tribunal will not dismiss the appeal for want of compliance. Department was directed to file the Counter within 3 weeks. DR had no instruction as to the status of appeal before High Court.

3. In all the above cases when the matter was listed before the CESTAT, for reporting compliance, the department was found lacking in its effort to get the matters disposed in the High Court and some of the cases, the departmental representative had not been kept informed of the latest status of the cases, and thereby could not satisfy the queries of the Bench.

4. After considering the various reasons given by the field formations for the various lapses observed by the Tribunal in its above referred order, Secretary (Revenue) has noted that there was failure on the part of the departmental officers either in coordinating with the departmental Counsels or there was delay in responding to the directions of the High Court/CESTAT or even keeping the AR updated. After analyzing all the deficiencies, Secretary(Revenue) has directed that departmental officers should follow up each of the cases in Court with our Standing Counsels, who will need proper directions and briefing.

5. The above observations of the Tribunal and Secretary(Revenue) are brought to the knowledge of all the concerned so that Chief Commissioners/Commissioners introduce a proper system of monitoring and handling the litigation at the field level to prevent delays in responding to the directions of the Courts/CESTAT.

6. It is also directed that pre-deposit orders are followed up for compliance and the office of the concerned Commissioner (AR) kept informed of all developments in the matter.

7. The receipt of these instructions be acknowledged.

This issues with the approval of Member(L&J), CBEC.

Your Faithfully,

Rajendra Kumar, OSD (Legal)

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