Customs, Excise and Gold Tribunal - Calcutta
Alnoori Tobacco Products And Anr. vs Cce on 27 January, 2005
ORDER V.K. Jain, Member (T)
1. These two appeals have been remanded to GESTAT by the Hon'ble Supreme Court vide its order dated 21st July, 2004. The Hon'ble Supreme Court has ordered as follows:
In view of the undisputed position that the CEGAT did not consider the relevant aspects and proceeded to decide the appeals on merits without examining the propriety of dismissal of appeals by the Collector (Appeals) for non-compliance with the requirements of Section 35(F) of the Act, the impugned judgments are unsustainable and are set aside. We remit the matter back to the CEGAT for adjudication afresh in accordance with law. The appeals are accordingly disposed of with no order as to costs.
2. Heard Shri K.P. Dey, ld. Advocate for the appellants. Shri Dey submits that in case of M/s. Alnoori Tobacco Products, the Commissioner (Appeals) asked the appellants to pre-deposit 100% amount of duty whereas in case of M/s. Warsi Tobacco Products, he asked to pre-deposit 50% of the duty amount before their appeal could be hears. The appellants could not deposit the above amount due to their bad financial condition. The Commissioner (Appeals) dismissed both the appeals without going into the merits only because they have not deposited the pre-deposit as ordered by him. Ld. Advocate submits that the appellants had a bad financial position and they were not in a position to pay the amount as demanded by the Commissioner (Appeals). He further submits that the case was in favour of the appellants as held by the Hon'ble Supreme Court as also by the Hon'ble High Court of Calcutta. The Hon'ble High Court of Calcutta in the case of Hooghly Mills Co. Ltd. v. Union of India has held as under:
Stay/Dispensation of pre-deposit - 'Undue hardship' - Meaning and scope - Covers a case where appellant has a strong prima-facie case - Section 35F of Central Excise Act, 1944. - The expression 'undue hardship' as used in Section 35F will cover a case where the appellant has a strong prima-facie case. If an appellant can establish before the Commissioner (Appeals) or before the Tribunal as the case may be, that he has got a strong prima-facie case, in such event the same itself independent of other factors would come within the relevant consideration for determining whether the order of pre-deposit will cause hardship or not. This is because of the reason that an assessee will suffer undue hardship if he has to pay an amount which is not legally due. It is not necessary for the appellant to show, in addition to, that the appellant ahs suffered financial hardship.
Stay/Dispension of pre-deposit - Prima facie merits of case being in favour of appellant not considered by Commissioner (Appeals) as sufficient ground for granting waiver of pre-deposit - Matter remanded - Section 35F of Central Excise Act, 1944.
He also relies on the Hon'ble Supreme Court's decision in the case of CCE, Chandigarh v. Smithkline Beecham Co. Health C. Ltd. reported in 2003 (58) RLT 479 (SC) : 2003 (108) ECR 42 (SC) where it has been held by the Apex Court that "Appeal - dismissed by Commissioner (Appeals) for non-deposit - Tribunal not to consider the case on merits - matter remanded to Commissioner (Appeals) for decision on merits." In view of the above, he requests that the matter may kindly be remanded to the Commissioner (Appeals) for re-consideration of their stay application and to decide their appeals on merits.
3. We have also heard Shri N.K. Mishra, ld. JDR for the Revenue who reiterates the order passed by the Commissioner (Appeals).
4. WE have heard both sides. In this case, the Commissioner (Appeals) has rejected both the appeals without going into the merits of the case. The rejection for both the appeals by the Commissioner (Appeals) was solely on the ground that the pre-deposits have not been made by the appellants. Keeping in view the Hon'ble Supreme Court's Order as also the Hon'ble High Court's decision as referred to above, we I remand the matter to the Commissioner (Appeals). The Commissioner t (Appeals) will consider the stay application filed by the appellants taking into consideration the financial hardship of the appellants and then I decide the appeals afresh after observing the principles of natural justice keeping in view the judgments of the Hon'ble Supreme Court and the Hon'ble Calcutta High Court. Both the appeals are allowed by way of remand.
Dictated and pronounced in the open Court.