Tribunal rules no retroactive pre-deposit penalty under Customs Act

The Tribunal ruled that the provisions of Section 129E of the Customs Act, 1962 regarding pre-deposit of penalty do not apply retrospectively to a case where the revision application was filed under the old Section 131. It was held that applying the pre-deposit requirement retrospectively would curtail the substantive right of the applicant. Therefore, the Tribunal ordered that no pre-deposit of penalty was necessary in this case under Section 129E of the Customs Act, 1962.

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Issues:
1. Whether the provisions of Section 129E of the Customs Act, 1962 regarding pre-deposit of penalty are applicable to a case where the revision application was filed under the old Section 131 of the Customs Act, 1962.
2. Whether the requirement of pre-deposit of penalty under Section 129E would curtail the substantive right of the applicant.

Analysis:
1. The case involved a Stay Application arising from Appeal No. CD(S) CAL-183/80, transferred to the Tribunal under section 131B of the Customs Act, 1962. The applicant argued that Section 129E regarding pre-deposit of penalty should not apply as there was no such requirement under the old Section 131. Reference was made to a Supreme Court judgment stating that any impairment of the right of appeal by a new procedural matter does not apply retrospectively unless expressly stated. The applicant requested the Court to order no pre-deposit of penalty in this case.

2. The respondent contended that under Section 129E, pre-deposit of penalty is mandatory unless a stay is granted due to undue hardship. After considering arguments from both sides and reviewing the case, the Tribunal found merit in the applicant's argument. It was noted that the old Section 131 did not have a provision for pre-deposit of penalty, and the new Section 129E came into force after the revision application was filed. Citing the Supreme Court and Privy Council judgments, the Tribunal held that applying the pre-deposit requirement retrospectively would curtail the substantive right of the applicant. Referring to a previous Tribunal judgment, it was established that pre-deposit of penalty is only required for appeals filed on or after the operative date of Section 129E. Consequently, the Tribunal ruled that no pre-deposit of penalty was necessary in the instant case under Section 129E of the Customs Act, 1962.

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