Pre-deposit compliance cannot block merits hearing where the appeal was not decided substantively and remand is required.

An appeal dismissed only for non-compliance with the pre-deposit requirement under Section 35F could not be rejected again once the appellant had already complied with the Tribunal's earlier deposit direction. Since the Commissioner (Appeals) had not decided the dispute on merits, the matter had to be reheard afresh, without insisting on any further pre-deposit. The appellate authority was also required to afford both sides a reasonable opportunity of hearing. The matter was therefore remanded for fresh adjudication on merits in favour of the assessee.

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Issues: Whether the appeal, dismissed for non-compliance with the pre-deposit requirement, should be restored and remanded for decision on merits without insisting on any further pre-deposit.

Analysis: The appellant had already complied with the Tribunal's earlier direction to deposit Rs. 50,000/-. The Commissioner (Appeals) had dismissed the appeal only for non-compliance with Section 35F of the Central Excise Act, 1944, and had not adjudicated the dispute on merits. In these circumstances, the appellate authority was required to decide the matter afresh, and no further pre-deposit could be insisted upon. A reasonable opportunity of hearing was also required to be afforded to both sides.

Conclusion: The matter was remanded to the Commissioner (Appeals) for fresh adjudication without insisting on any further pre-deposit, in favour of the assessee.

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