Gujarat High Court
Messrs Priya Dyers vs Commissioner Of Central on 24 April, 2013
Author: Akil Kureshi
Bench: Akil Kureshi
MESSRS PRIYA DYERS....Appellant(s)V/SCOMMISSIONER OF CENTRAL EXCISE....Opponent(s) O/TAXAP/109/2013 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 109 of 2013 With TAX APPEAL NO. 110 of 2013 ================================================================ MESSRS PRIYA DYERS....Appellant(s) Versus COMMISSIONER OF CENTRAL EXCISE....Opponent(s) ================================================================ Appearance: MR PARESH V SHETH, ADVOCATE for the Appellant(s) No. 1 MR YN RAVANI, ADVOCATE for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MS JUSTICE SONIA GOKANI Date : 24/04/2013 COMMON ORAL ORDER
(PER : HONOURABLE MR.JUSTICE AKIL KURESHI) Heard these appeals for final disposal. Both these appeals involve similar questions. The issues pertain to refusal of the Tribunal to restore the Tax Appeals of the present appellants by the impugned common order dated September 25, 2012.
Brief facts are as under :
The appellants had filed Tax Appeal Nos.2754 and 2755 of 2004 before the Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as 'the Tribunal'). They had also prayed for waiver of pre-deposit. Such applications were disposed of on December 31, 2004 by the Tribunal requiring the appellants to deposit the total sum of Rs.25 lac by way of pre-deposit. The appellants thereupon preferred Special Civil Application No.4798 of 2005 before this Court, which was withdrawn on March 21, 2005, to enable the appellants to prefer modification application before the Tribunal. Once this attempt failed, the appellants again approached High Court. Their Tax Appeals came to be dismissed on October 21, 2010. They thereupon approached the Supreme Court. The Special Leave Petitions were withdrawn on September 03, 2012 with liberty to approach the Tribunal stating that the restoration applications have already been filed before the Tribunal.
Thereupon the appellants deposited the entire amount of Rs.25 lac and requested the Tribunal to restore the Tax Appeals. On such applications, the Tribunal passed the impugned order holding that once the High Court dismissed the appellants' Tax Appeals against the order of the Tribunal imposing the requirement of pre-deposit, the Tribunal would become functus officio and could not entertain the restoration applications. At that stage, the appellants have approached the High Court once again by filing these Tax Appeals.
Having heard the learned counsel for the parties, we are of the opinion that when the appellants have already made the pre-deposit as insisted upon by the Tribunal on appropriate conditions, their appeals should be heard on merits. We are conscious that the Delhi High Court in the case of Commissioner of Customs v. M/s.Lindt Exports, reported in 278 ELT 587, has taken a view that the Tribunal would be rendered functus officio upon the High Court dismissing the appeal and, therefore, any application for restoration before the Tribunal would not be maintainable. In such case, we notice that after the High Court dismissed the appeal upholding the order of the Tribunal, the pre-deposit was made four years later.
Be that as it may, insofar as this Court is concerned, consistent view has been that the right of appeal is sacrosanct and should not be lightly taken away. It is true that under the Central Excise Act, 1944, such right of appeal is hatched by the requirement of pre-deposit of entire amount or such reduced amount as the appellate forum, the Commissioner of Tribunal, may in terms of Section 35-F of the Central Excise Act, 1944, provide. However, in view of the fact that for want of fulfilling the requirement of pre-deposit, the assessee's right of statutory appeal would get destroyed and the decision adverse to him would get confirmed without consideration of issues on merits, the Court has also been taking relaxed view of belated compliance of requirement of pre-deposit. This is not to suggest that the order passed by the competent forum insisting on pre-deposit should either be allowed, ignored or to be taken lightly. This is only to suggest that such pre-deposit requirement is fulfilled somewhat belatedly and there is explanation of such delay. The Court would examine that in the interest of justice the appeal should be directed to be heard on merits or not.
In the case of Scan Computer Consultancy v. Union of India, reported in 2006 (204) ELT 43 (Guj.), the Division Bench of this Court made the following observations :
10. Applying the aforesaid ratio to the facts of the case, it is apparent that Commissioner (Appeals) committed an error in law when he came to the conclusion that he could not restore the appeal and the only remedy was by way of preferring appeal before higher forum. Needless to state that, by mere default in making deposit as directed, the appellant does not stand to gain anything and only delays his right to have his case adjudicated. Nor does such a delay in making pre-deposit cause any prejudice to the revenue, in absence of any stay operating in favour of the petitioner. It cannot be lost sight of that right of appeal is statutorily granted and it is hedged in by the requirement to make pre-deposit as directed by the appellate authority, as being a condition for hearing of the appeal on merits.
However, that condition cannot be used by the appellate authority for the purposes of denying an appellant the right of adjudication which is otherwise statutorily granted. In a given case, even if no pre-deposit is made, the appeal may not be heard, but having dismissed the appeal for non-compliance of pre-deposit does not permit the appellate authority to refuse to restore the appeal upon compliance being shown.
In the case of Hussein Haji Harun v. Union of India, reported in 1995 (77) ELT 803 (Guj.), the Division Bench observed that when the appeal is dismissed for non-compliance of the condition of pre-deposit, the appellate authority would have power to consider the restoration of appeal. Mere absence of a specific provision permitting such restoration would not be a bar.
Keeping in mind the above decisions and considering the fact that the appellants were all throughout pursuing the remedy before the higher forum seeking further waiver of pre-deposit, as also considering the fact that the Special Leave Petition was dismissed on August 29, 2011 and thereafter, fresh application was filed, which was withdrawn on September 03, 2012 and even while such proceedings were pending before the Supreme Court, the appellants had taken steps for seeking restoration of their appeals before the Tribunal, we are of the opinion that the Tribunal should hear the Tax Appeals on merits, on further condition that the appellants shall deposit further sum of Rs.5 lac before the Tribunal latest by June 30, 2013. This additional condition we have imposed on the learned counsel for the respondent pointing out that the pre-deposit requirement was imposed in the year 2004.
With these directions, both the Tax Appeals are disposed of.
(AKIL KURESHI, J.) (MS SONIA GOKANI, J.) Aakar Page 6 of 6